real estate news

It’s cold now but is the market about to heat up?

Real Estate Update Jan 2020

What is the forecast for real estate in 2020? The real estate market in the Fraser Valley ended 2019 with average sales and a mostly sellers market due to very low inventory. This was a stark contrast to the first half of 2019 where sales were well below average. Prices in many areas have stabilized over the past three months after 12 months of decreases. Typically, the spring season is where we see the greatest number of sales however, in 2019, sales were down in the spring and up during the fall months.This contrary scenario has many people wondering about the upcoming spring market.  Will this trend of increasing sales continue into the spring? Will we see prices increase over the next six months? 

2020 starts the year with very low inventory levels throughout the Fraser Valley and Vancouver area. Sales have been increasing since July 2019. If demand continue to grow, low inventory levels may push prices up. In North Delta, 45 detached homes were sold in December 2019 out of 84 properties listed on the MLS. With a 54% turnover rate in December, that put North Delta in a sellers market for detached properties. Compare this to December 2018 when only 16 detached homes sold out of 142 properties listed on the MLS. The change in supply and demand has resulted in a price increase of about 3.3% over the past three months for detached homes in North Delta. Cloverdale, Mission and Langley have also shown an increase in prices for detached homes, ranging from 1% to 1.5%. 

Vancouver area prices for detached homes have also stabilized over the past three months. Even the most expensive areas of Vancouver: West Vancouver, Richmond and Vancouver west side are experiencing stable prices. Attached properties in the Vancouver area are seeing prices increase in many areas. 

The strongest demand for housing in the Fraser Valley and Vancouver area continues to be for townhouses and condos. The Canadian Mortgage and Housing Corporation recently reported that in 2019, Vancouver (includes Fraser Valley) had a 31% increase in new construction for townhouses and condos compared to 2018. This increase in new construction may help to maintain stable prices throughout the region. 

Many economists expect the overnight bank rate to remain at 1.75% for now. The economy continues to grow at a sluggish rate but a recession is not expected to hit Canada in 2020. High immigration into Vancouver is expected to bolster demand for housing in the area. 

The Conference Board of Canada forecast in December that Canada’s economy will grow by 1.8 per cent in 2020, a modest uptick from the 1.7 per cent growth seen last year.

Regionally, British Columbia and Quebec are expected to see the strongest economic growth, according to the Business Development Bank of Canada.


Buyer Opportunities (Detached)

Prices in South Surrey remain particularly low. Compared to central Surrey, the price difference between the two areas is only 30% – the smallest gap in over 15 years.  In July 2017, the price difference between the two areas was 54%. In the past three years, South Surrey is the only area in the Fraser Valley that is showing a loss in value (down 7.5%) while all other areas have posted price gains of 8% to 18%. 


Buyer Opportunities (Attached)

South Surrey had the smallest turnover of attached properties in December compared to the rest of the Fraser Valley. The inventory is still decent and price increases over the past three years are the lowest in the Fraser Valley. 
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If you are thinking of selling in the spring, now is the time to speak with me. Preparing your home for sale takes time and you may require the help of several different trades and services. Over many years, I have put together a list of highly recommended companies to serve your needs in this regard.  Call or email, I’d be happy to send you my recommendations. 

2018 starts the year with extremely low inventory.  

Fraser Valley:

Inventory levels for attached properties throughout the Fraser Valley were significantly lower in January compared to a year ago. This could mean that we will continue to see steady price increases for townhouses and condos for the next few months.  Demand for condos and  townhouses remains high. It is unlikely we will see a drop in demand while the rental vacancy rate remains at 1 percent and the unemployment rate also remains low.

The inventory for detached homes was also down for January compared to January 2017. Most areas in the Fraser Valley remain in a sellers market for detached homes with prices showing gradual increases.

Overall sales for January were 1,210, 24 percent higher than last January and the third highest sales total for a January in the Board’s history, behind only 2016 (1,338) and 1992 (1,270). Changes to the mortgage rules and interest rate increases have not yet affected the market.
HPI® Benchmark Price Activity

  • Single Family Detached: At $982,700, the Benchmark price for a single family detached home in the Valley increased 0.6 per cent compared to December 2017, and increased 15.1 per cent compared to January 2017.
  • Townhomes: At $519,400 the Benchmark price for a townhome in the Fraser Valley increased 1.2 per cent compared to December 2017, and increased 23.4 per cent compared to January 2017.
  • Apartments: At $404,100, the Benchmark price for apartments/condos in the Fraser Valley increased 4 per cent compared to December 2017, and increased 44.1 per cent compared to January 2017.

 

Greater Vancouver:

Across the Greater Vancouver area, detached homes remained in a balanced or buyers market while townhouses and condos remained in a sellers market. Sales for detached homes were under the 10 year average while sales for townhouses and condos were well above the 10 year average.

HPI® Benchmark Price Activity

  • Single Family Detached: At $1,601,500, the Benchmark price for a single family detached home increased 8.3 per cent compared to January 2017 but decreased .07 per cent in the past six months.
  • Townhomes: At $803,700 the Benchmark price for a townhome increased 17.5 per cent compared to January 2017.
  • Apartments: At $665,400, the Benchmark price for apartments/condos increased 27.4 per cent compared to January 2017.

 


HOME DESIGN TRENDS TO WATCH FOR IN 2018


Buyer Opportunities (Detached)

White Rock continues in a buyers market.

Abbotsford – get in while you still can. The average home in Abbotsford is more than $200K less than in Langley.

Buyer Opportunities (Attached)

There is much less competition for properties built prior to 2010. Older properties tend to have rental restrictions but if you are purchasing to live in, you will get much more square footage for your dollar.

The spring season is approaching and we are expecting the sellers market to continue and prices to rise.  If you are thinking of selling, I would love to help you prepare.