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Clients, Neighbours and Friends,
Up to this point declining home sales have been mostly about tariff
uncertainty but as we move closer to Aprils stats release and the results of
our federal election (yet another element causing economic uncertainty) we
thought it a good time to look at home sales and pricing at a micro and macro
level.
According to the BCREA, end of March …
- The Fraser Valley posted sales
in down -25.7 per cent when compared to the same time last year –
YIKES! On the flip side, pricing continued to remain
relatively stable, down -2.5 per cent over the same time frame.
- BC
home sales were down -9.6 per cent, home prices down -4.8
per cent.
- Nationally,
the CREA reported down trends across Canada,
sales down -20 per cent since November. The national
average home price now sitting at $678,331 down -3.7 per cent.
Although home prices near and far have been on a
downward trajectory for months, you can see from the numbers above it’s been
a subtle drawback.
On the ground this combination of real estate metrics and economic factors
indicate markets continue to be in a state of transition.
With the April 16 mortgage rate hold (the first rate hold in over a year of
rate cuts) buyers are once again shifting back to the sidelines, particularly
in BC’s larger markets like the Fraser Valley. Conversely, sellers are
listing their homes which is helping to ease market pressures around
supply. And, based on what we are seeing, the right type of listing, in
the right neighbourhood, asking the right price will sell.
But as posted in our last blog; “ … we
are still seeing a disconnect as sellers remain hesitant to lower their
prices beyond a certain threshold, while buyers … are unable or unwilling to
meet it … ”
Transitional times are par for the course in interest rate dependant sectors
however, to put things in perspective … Canadian home sales in March hit
levels not seen since the 2008 financial crisis.
Moving forward the Bank of Canada will be paying close attention to the
following:
- The
extent to which higher tariffs reduce demand for Canadian exports
- How
much this impacts the business investment, employment, and household
spending
- How
much and how quickly cost increase are passed on to consumer prices
- How
inflation expectations resolve
The BOC’s most recent messaging has been
around the unlikelihood it will continue to lower rates in the face of rising
inflation however; we have been hearing whispers from those in the mortgage
biz that the BOC may in fact lower rates a couple more times to help offset
any potential downturn in the economy.
If rates were to be
lowered again, we expect a rush to market for those who want or need to make
a move this year.
The next interest rate announcement is scheduled for June 4 so if the above
resonates with you, now would be a good time to book a market evaluation with
a realtor who understands transitional markets
and how to navigate them.
We can help.
Jenn & Colin
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