With buyers still adjusting to the mortgage stress test introduced in 2018, 2019 proved to be one of the slowest starts we have had in our 15 years of practice. But even with the spring market MIA, the Jenn and Colin Real Estate Team had a pretty solid year in terms of sales volume.
Fraser Valley sales started picking up come summer and then finished strong with a November /early December uptick in activity. And although 2019 sales totals are down compared to 2018, the last few months have registered above average sales stats.
See some great summary graphs of Surrey markets by clicking HERE
December, typically a very slow month for us, was action packed with buyers making offers on the best of the properties still on the market. This late in the year sales rush has drained the last of Fraser Valley inventory. Low inventory and now snowy conditions have created a stop-gap in market momentum for January but with all the delayed listings and sales over the last 12 months we are of the opinion the pent up demand and/or general need to move will bring about an early start to the 2020 market.
Our positive outlook is supported by a strong economy.
The BC economy is currently buoyed by steady job growth, a vibrant labor market, strong immigrant housing demand and low interest rates. Further, a review of leading real estate experts in Canada reveal a 2020 recovery in housing markets across the nation …
The Canadian Real Estate Association (CREA) is expecting national sales on 2020 to surpass 2019 by 8.9% and the national average home price to reach $531,000, a 6.2% increase over last year.
Conversely, Royal Lepage is predicting a national 3.2% increase in housing prices in 2020 with REMAX slightly more bullish at 3.7%.
And in BC …
The BC Real Estate Association (BCREA) predicts BC residential sales to increase by 10.9% compared to last year.
Central 1 Credit Union is confident the BC median home price will break records in 2020 and in 2021 predicting a rise of 3.8% to a new all-time provincial high of $542,000.
At the same time …
The Bank of Canada is unlikely to raise interest rates this year and with buyers now adjusted to the mortgage stress test we will likely see an uptick in mortgage demand.
Although the general consensus among leading forecasts is positive for sales, pricing predictions are more cautious expecting any price growth to be modest (with no loss in value) and region specific. Generally confined to the lower mainland. For example, the BCREA expects Greater Vancouver and the Fraser Valley to see a sale price rise of just 1% in 2020.
Right now in the Fraser Valley …
The benchmark price of a detached home currently sits at $953,700 down 1.2% compared to December 2018. For townhomes and condos, $514,900, down 3.2% and $405,500 down 3.1% respectively.
And in Surrey (sans White Rock) …
The benchmark price adjustments are similar. Detached homes currently at $1,045,400 down 1.9% from last year. Townhomes and condos, $559,200 down 3.1$ and $424,800 down 3.1% respectively.
At a more micro level, we see only slightly more variance in pricing, mostly in South Surrey …
In Surrey Cloverdale (incld Sullivan Panorama) the detached benchmark price now sits at $998,100 up 1.6%, townhomes and condos now at $560,700 up 1.9% and $448,700 down 4.1%.
South Surrey / White Rock shows the benchmark price of a detached home at $1.299,500 down 4.5%, townhomes and condos, $625,000 down 7.3% and $475,800 down 4.9%.
In closing we hope to offer some helpful considerations for buyers and sellers looking to navigate the 2020 market.
Buyers have adjusted to the mortgage stress test and seem confidant that pricing has leveled off but many are still suffering from “multiple offer fatigue” and are genuinely concerned they may face a quick escalation in house pricing this year. We feel this concern is valid, but only in some areas. With inventory levels across property types currently very low, buyers may not be afforded the same selection of homes, or the time to look around, they were offered last year and depending on the home and area, some buyers may face multiple offer situations.
Many sellers we have talked to this fall/winter been taking the “wait and see” approach, holding back on listing. In 2020 sellers markets will likely only be seen in hyper specific areas and property types but without a healthy supply of inventory in the coming months, we could see strong upward pressure on pricing. If you’re thinking about entering the 2020 market, earlier may be better but speak to your local realtor to learn more.
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