Garth Turner 2008 – “An anti-real estate mood has swept America. Within months it will be here”
MacLean’s Magazine 2012 – “There is evidence the tide may already be turning in Canada’s housing market.”
Homer Simpson season 3 – “It takes two to lie. One to lie and one to listen.”
I don’t predict try to predict the future of the real estate market, anyone that claims they knew the realm estate market in the Lower Mainland would appreciate at such a fervent rate in recent years is a liar – we are all shocked!
At 25 years of age I bought my 1st home. I was afraid $67,000 was a lot of money for us newly weds. Over the years we have bought and sold numerous times. We have moved and we have bought investment properties. Some deals looked great at the time others felt less sure, in the long run all paid off. I can honestly say that in my my 25+ year career there has been no time that I would have regretted buying two years earlier.
I don’t know what tomorrow will look like but I know our population is growing and I know that we are living in the best place in Canada, perhaps the best place on earth. Buy and hold.
This chart shows the sales of detached homes (houses) in the Fraser Valley and in Abbotsford during the first 20 weeks of 2016 and 2017.
As you can see the number of units sold is off slightly. There is one dramatic dip indicated during week 13 of 2016. This reflects the media storm generated by the bad practices of a few bad apples practicing in the Greater Vancouver market. As a result Christy Clark vowed to crack down on “shadow-flipping” and began an investigation into industry practices. The short duration of the market pause shows the resilience of the region’s market.
MLS stats show that February 2017 saw a 41% decline in sales vs February 2016 (1,396 in 2017 vs 2,387 in 2016).
Is it time to panic as a seller or the time to celebrate as a buyer? The impact of a significant decline in demand (buyers) is being lessened by an offset in the amount of supply (sellers). February 2016 saw 34% more new listings hit the market than February 2017 (2,171 in 2017 vs 3,283 in 2016).
What’s the bottom line?
Data for the Fraser Valley shows that prices for all product types (houses, condos & townhouses) remain significantly higher than a year ago. We have seen a small decline in the value of detached homes (houses) while condos and townhouses are stable or inching upwards.
As always I caution the reader not to make decisions based entirely on these statistics as they reflect the Fraser Valley in it’s entirety and regional differences are sure to exist. Speak with an expert, someone with experience and knowledge in your region before you jump to false conclusions.
“…data says Vancouver home sale price averages dip below $1-million”
“For the first time in recent memory, the average sale price for a home in Vancouver has dipped below the $1-million price tag.
It’s more evidence the real estate market in Vancouver is coming to a screeching halt.
Zolo, a Canadian real estate brokerage which keeps track of MLS home sales in real time, reports that the average sale price for properties in the city have now fallen to around $993-thousand dollars.
That’s well off the neighbourhood of $1.4-million at this time last year, a 28 per cent free fall.”
I am not arguing with the data provided but I am arguing with the interpretation of the data. The Vancouver market is changing but it is not “coming to a screeching halt” and prices are not in a “free fall”. Typical attention-grabbing rhetoric by the media.
The reality is much less exiting, unless you own a luxury home. Yes Vancouver house prices peaked in the summer of 2016 but they are still up from 2015. What has changed is the amount of luxury home sales, homes priced at $5 million, $10 million or even higher. The rest of the market has not been impacted as much by the 15% foreign buyer tax.
Statistics quoting average sales prices combine all sales regardless of their type or location. Less sales at the high end pull down the average. If you look at a typical east Van house on a 30′ lot prices haven’t moved dramatically.
Prices shift independently by product type and location. As always it is important to work with an expert in the market, someone with the experience and knowledge of the community and the type of real estate you are considering.
The most frequent comments that I hear this time of year is; “Wow, you must have had a great year!” This is quickly followed by, “what’s your prediction for 2017?”
Yes 2016 was a busy year. A very busy year. The highest number of transactions ever recorded by the Fraser Valley Real Estate Board.
Here are a few stats regarding the Abbotsford residential detached market (houses). Chilliwack, Mission & Langley saw similar trends.
Supply/demand ratio peaked in March
The number of transactions peaked in April
Prices peaked in August
The froth (crazy bidding wars, etc.) has mostly disappeared from the market
Prices have eased slightly but remain higher than last year.
So how does 2017 look?
The supply of active listings vs sales is remaining low. If the inventory growth doesn’t outpace the demand prices should remain stable.
Mortgage rates remain low and are likely to remain low for some time.
BC has the strongest economy in Canada and is likely to remain a leader.
Foreign investment has decreased in the GVRD but domestic demand remains strong. Some experts anticipate a resurgence of foreign investment. Not my area of expertise.
Trump is a wild card. BC is less dependant on trade with the US than Ontario and others. I’m not an expert on Trump – nobody is.
The supply of new ground oriented housing is low and will remain low due to a limited supply of development land west of Abbotsford. Industrial land is facing similar pressure.
I don’t make predictions but people want to live here, Is there a better place in Canada? Combine the demand with limited supply and prices are not likely to make a significant and sustained move downward. This may be a buying opportunity?