Big satisfied sigh as the Fraser Valley real estate market continued to act normal in October. Home sales were up from September and up substantially from 2012.
As Fraser Valley Real Estate Board president Ron Todson says, "We've had a great summer and good early fall, but it's important to remind everyone of the context. The last four months of 2012 were amongst the slowest for our real estate market in the last 15 years.
"What we're witnessing is a return to a balanced residential market indicated by prices remaining unchanged or down slightly compared to a year ago, stable inventory levels and the average length of time to sell a home is about two months."
We'll look at October's sales, listings and prices, but seeing those don't give us much to talk about, we'll also throw in some interesting factoids and insights from the recent Canadian Mortgage and Housing Outlook conference. For instance, the Fraser Valley is responsible for 20 per cent of all home resales in BC. It's also one of the fastest-growing areas in BC, with population growth of 1.9 per cent since 2008. That's 6,862 new households. Surrey is the fastest-growing Fraser Valley city, with 2.4 per cent more people in five years and 3,668 new households added. The Fraser Valley makes up one-third of the population growth of the Vancouver Census Metropolitan Areain essence, the Lower Mainland.
All those folks need homes, and many found them last month.
2013 populations of Surrey, Langley, Chilliwack, Abbotsford and Mission
Sales and Listings
Perhaps the gorgeous weather brought out home buyers in October. The 1,102 house, townhouse and condo* sales through the MLS® in October bested September's sales by almost 10 per cent.
As CMHC market analyst Richard Sam pointed out in his presentation, people in the Fraser Valley want land. The detached house is responsible for 55-to-60 per cent of all salesthe exact opposite of the Greater Vancouver market where 60 per cent of all sales are multifamily.
Last month, 584 houses sold, along with 278 townhouses and 240 apartments.
What's Up, What's Down - At a Glance Oct/Sept 2013 Oct 2013/ Oct 2012 Overall Home Sales +9.8% +20.5% - Detached +4.5% +10% - Townhouse +8.6% +33% - Apartment +27.7 +37.9% New Listings -8.3% -10% Active Listings -11.3% - 13.3%
Residential sales have been up and down over the last few months. They climbed steadily from January through May, then started wavering from month to month: June, -2.3 per cent; July +8.5 per cent; August, -13.8 per cent; September -2.8 per cent, and then a 9.8 increase in October.
Meanwhile, listings lag sales. According to the CMHC, listings have trended down since 2010. The FVREB numbers show a lack of new listings since June. As a result, resale home inventory has dropped, as this chart shows.
The Fraser Valley market currently favours buyers, with the sales-to-active-listings ratio for all types of real estate at 14 per cent.
For local market details, see the Fraser Valley Real Estate Board statistics, broken down by community.
Fraser Valley real estate board sales plus new and active listings
MLS® Benchmark Prices
Benchmark prices for single-family houses and townhouses remain stable, but the market for condos shows more price sensitivity.
Fraser Valley MLS® Benchmark Prices, % Change Oct 2013 Sept 2013 Oct 2012 Detached $551,400 -0.3% +0.8% Townhouse $295,500 -0.2% -0.5% Apartment $199,500 -1.8% -2.2%
In his CMHC presentation, Richard Sam pointed out that in the Fraser Valley it can make more sense to buy a condo than rent an apartment. The average rent for a 2-bedroom apartment is $781. Sam says, "If you can spring off a 10 per cent down payment, your monthly payment on a conventional [mortgage] rate is probably in the $250 range above rent... but that's the conventional rate. We calculated for a discounted rate, and the monthly payment on a mortgage is actually below $1,000. So it turns out, for renting versus buying, if you can come up with the down payment, you might be better off purchasing than renting."
Here's the CMHC forecast for the Fraser Valley in 2014:
- Population and household growth to continue
- Resales will be moderate in 2014
- Lower listings and higher demand for single-detached will increase prices
You can view the full FVREB statistics package for October, 2013 here.
Greater Vancouver Real Estate Market: October 2013
BCREA: Strongest October in Four Years
