As expected the May statistics are showing a more market contraction in terms of sales. Sales are down and listings are up with the sales-to-actives ratio now entering what we call “balanced conditions” … see the attached graph.
It’s hard to say for sure if the final quarters of this year will move beyond a balanced ratio and deep dive into a buyers market but indicators would suggest this is where we are headed and markets in general are certainly over-due for a correction.
Historically, this shift in the sales-to-active ratio precedes a decline in home values and sale prices. So far this shift has been slow and steady but it remains unclear how the final quarters of the year will play out.
Although more pronounced in the detached home category (due to affordability) this downward trend has been showing across property types in Sullivan, Panorama, South Surrey and the Fraser Valley for the last few months, some markets even longer and although we are now seeing regular price reductions we also seeing sellers still wrestling with this shift.
This period of time where buyers and sellers are re-evaluating their timelines and expectations tells us we are still in what we call a transitional market. This limbo period can take anywhere from 3-6 months and how rapid this shift occurs has a lot to do with the frequency and tone of mainstream media coverage.
You can read the entire May stats package by clicking the link below but here are some of the take-aways …
Of the 1,758 sales processed last month 417 were townhouses and 516 were apartments, together representing 53 per cent of all SALES transactions in May.
Active inventory for the Fraser Valley finished at 6,736 listings last month, the highest level since September 2015, increasing 18.9 per cent month-over-month and 29.5 per cent when compared to May 2017.
Surrey / Cloverdale Sales from April to May
Detached homes down -8.5%
Townhomes: down -29%
Apartments up 3%
Surrey / Cloverdale Average Price from April to May
Detached homes down -6.5%
Townhomes: down -2.3%
Apartments up 3.1%
South Surrey Sales from April to May
Detached homes down -12.5%
Townhomes up 12.1%
Apartments up 4.8%
South Surrey Average Price from April to May
Detached homes down -6.4%
Townhomes down -6.4%
Apartments up 3.3%
The above corrections are much more significant when comparing May 2018 to 1 year ago in May 2017 but for our purposes we are watching the monthly stats more-so to try to gauge the speed of this correction and how far ahead of this curve sellers need to be in terms of their asking prices.
I hope you find this information insightful when forming your real estate goals. If you have any questions regarding stats in any particular sub area or property type just let me know. 778-929-5741 / email@example.com
Here is the full package just released from the Fraser Valley Real Estate Board.