Sales in December and January were the lowest on record in a decade.  New listings last month were also significantly lower than average for January. Low sales and low inventory have put the market generally in a balanced position. The market for detached homes in many areas across the Lower Mainland are experiencing buyers markets however, many areas are experiencing sellers markets for attached properties leading to some price increases.  This difference really is a result of price. Large mortgages accruing interest at 6% are both expensive and difficult to obtain. 

 

The Bank of Canada increased the policy rate a further .25% on January 25 however, it also announced that it will now pause on further increases.  This pause comes with a disclaimer; if inflation does not continue its downward trend, more hikes will be made in the future. One of the categories that has a strong influence on inflation is the cost of housing. If the real estate market heats up in the spring and prices start to increase, the Bank of Canada may decide to make another increase to the policy rate. 

 

Inflation is currently sitting at 6.3%, down from a high of 8.1% in June. The Bank is expecting inflation to fall to 3% by the middle of this year and reach the target rate of 2% in 2024. There are many variables involved in this projection but if inflation does reach 3% this year, we can expect the Bank to start looking at policy rate decreases. 

 

Fraser Valley Stats

 

Detached Homes

 

182 detached homes sold across the Fraser Valley in January. That number is 61% less than January 2022 and 17% less than December 2023. It really is a buyer’s market for detached homes, despite the low inventory. 

 

The Benchmark Price for detached homes in the Fraser Valley has now dropped 17.6% in the past year. Mission and Abbotsford have both seen prices drop over 26%. South Surrey prices have shown to be the most resilient, posting a drop of only 8.7% in the past 12 months. 

 

Townhouses

 

There were 169 townhouse sales in January but with only 684 active listings, the sales-to-listings ratio indicates a sellers market.  Despite this, prices continue to drop for townhouses. The Benchmark Price for townhouses has dropped 8.8% in the past 12 months. South Surrey has seen prices drop over 12% while Langley prices have dropped only 2.5% in the past year. 

 

Condos

 

The Benchmark Price for condos has dropped 5.9% in the past 12 months, however, many areas have shown price increases over the past two months.  The affordability of condos has played a large role in continued demand. Also, the recent changes to strata rules which eliminated the ability of a strata corporation to restrict rentals, has led to an increase in condo purchases by investors. 

 

In the past, condos have generally had more restrictive bylaws than most townhouses. Strata corporations can no longer restrict an owner from renting their unit as long as the initial rental term is for one year. In addition, age restrictions under 55 years are no longer allowed. These two changes mean that families and investors have more options. 

 

Fraser Valley MLS® HPI Benchmark Price Activity

 

  • Single Family Detached: At $1,357,800, the Benchmark price for an FVREB single-family detached home decreased 1.4% compared to December 2022 and decreased 17.6% compared to January 2022. 
  • Townhomes: At $773,100, the Benchmark price for an FVREB townhome decreased 1.8% compared to December 2022 and decreased 8.8% compared to January 2022. 
  •  Condos: At $503,700 the Benchmark price for an FVREB apartment/condo decreased 0.2% compared to December 2022 and decreased 5.9% compared to January 2022.

 

Greater Vancouver Stats

 

Sales in the Greater Vancouver area were down 55.3% from January 2022 and down 21% from December 2022. January typically posts the fewest number of sales in the year. 

 

The market for townhouses and condos has been balanced for the past two months with some exceptions. North Vancouver, Ladner, Port Coquitlam and Pitt Meadows have been in sellers markets, largely due to very low inventory.  Prices have gone up for attached properties in certain areas while prices in other areas appear to have stabilized for now. 

 

Demand for detached homes in Vancouver, west side, West Vancouver and Richmond has been very low for the past two months. Demand in other areas has been stronger however, prices for detached homes are still falling throughout the Greater Vancouver area. 

 

Greater Vancouver MLS® HPI Benchmark Price Activity

 

•Single Family Detached: At $1,801,300, the Benchmark price for a single-family detached home decreased 1.2% compared to December 2022 and decreased 9.1% compared to January 2022.

•Townhomes: At $1,020,400, the Benchmark price for a townhome increased 0.8% compared to December 2022 and decreased 3% compared to January 2022.

•Condos: At $720,700 the Benchmark price for a apartment/condo increased 1% compared to December 2022 and decreased 1.1% compared to January 2022.