BC Real Estate: Market Shift in the Fraser Valley
While home prices in Metro Vancouver remain sky-high, the price of single-detached single-family homes in two of the region’s fastest-growing markets has recently seen a major drop, according to an industry group.
HouseSigma uses AI to compare historical listings and estimate current values in real time. Its latest data compared February and May 2022 prices.
In Surrey, the average price fell from $1.9 million to $1.59 million, a drop of 16.3%. In Langley, the price fell from $1.75 million to $1.5 million, a decrease of 14.3%.
While higher interest rates are expected to cool the market in British Columbia and beyond, HouseSigma agent Hao Li says there’s likely something else at play in those two places. As people flocked out of town in search of cheaper housing, the population boom drove prices up. Now Li says the demand has subsided.
“One of the reasons it’s going down even more is that it’s grown much faster in those two cities compared to other cities in Metro Vancouver over the past two years,” he says.
“We can predict that the price and sales volume will initially drop. But over time, they will stabilize.”
In markets and times like this, Li says, trading becomes something buyers and sellers start to focus on.
While Surrey and Langley posted the only double-digit declines, the average price of a single-detached home was down everywhere except Richmond and West Vancouver.
The latest data from the British Columbia Real Estate Association indicates that the sharp rise in mortgage rates is pushing the province’s home sales towards a “normalization path”, although it estimates that a balanced market is at least a year away. .
According to the Fraser Valley Real Estate Board, April 2022 marked the first time sales in the region fell below the 10-year average.
“We would typically see a flurry of activity at this time of year,” FVREB President Sandra Benz said in a statement.
“However, this has not been the case so far. While it is still too early to tell if this trend will persist, the slowdown in sales combined with an increase in active listings is helping to restore some semblance of balance in the market, which is encouraging for buyers.
The council also said rising mortgage rates would likely lead to lower demand, but “low inventory” means prices are unlikely to see a substantial drop.
The average length of stay for a property on the market last month in the Fraser Valley was 16 days for a single-family home and 13 days for a townhouse or apartment.
With files from The Canadian Press