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The standoff between buyers and sellers extended into February across British Columbia, the B.C. Real Estate Association reported Thursday, prompting its chief economist to ponder when it might break.

Sales recorded through the Multiple Listing Service dropped 24 per cent in February to 4,501 transactions compared to 5,895 a year ago, the report said. The provincial average price was $529,922 in February, down 8.1 per cent from February 2012.

And BCREA chief economist Cameron Muir said the move-up buyers, downsizers and others he would normally expect to be in the market have been on the sidelines long enough that "pent-up" demand must be building for a potential rebound in sales.

"The question is when is that going to occur," Muir said. "Is that going to occur in the second quarter, is that going to occur in the third quarter or fourth quarter?" Or will it take longer?

Muir said the 2013 sales levels are similar to the market through the late 1990s, when B.C. saw successive years of slow sales and price increases that did not keep up with inflation. Plummeting mortgage rates after 9/11 were the trigger that sparked a rebound, he said.

For the first two months of 2013, B.C.'s sales have totalled 9,842, a 20-per-cent decline from the first two months of 2012.

While the decline in sales in Metro Vancouver and the Fraser Valley had the biggest influence on provincial numbers, a few regions saw steeper drops both on a percentage basis and on price.

The South Okanagan Real Estate Board, for instance, saw a 33-per-cent decline in sales to 66 units in February compared to 98 in the same month a year ago.

The average South Okanagan price was down almost 20 per cent at $244,666, compared to $304,421 in February 2012. This region takes in Penticton and Osoyoos.

In Northern Lights, the area around Dawson Creek, sales in February were down 38 per cent at 29 units, compared to 47 units a year ago. Prices, however, were up 7.5 per cent to $287,057.

On Monday, TD Economics reported that after a boom in Canadian real estate that lasted most of the decade, homeowners can expect a long period of little growth in home prices - perhaps just keeping up with inflation for as long as the next 10 years.

TD senior economist Sonya Gulati said the adjustment will account for the period when home prices "moved away from their underlying economic fundamentals."

Muir agrees that "home prices, over the next couple of years, are not really going anywhere," but over the longer term "it's harder to take those numbers to the bank."

However, while new stricter mortgage qualification rules introduced last year crimped the buying power of first-time buyers, Muir noted mortgage rates remain near historic lows, B.C. is still experiencing population growth and the economy is still seeing job creation, all of which should support a higher level of housing sales.

depenner@vancouversun.com

Twitter.com/derrickpenner

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