January 2022 – Fraser Valley Real Estate Market Snapshot - Fifth Avenue REM mediaiqdigital tracking pixel
Market Intelligence, Peerage Partners, Real Estate News | February 9, 2022

Let the Balancing Acts Begin. 

Looking at the January data it is clear the Fraser Valley real estate market is beginning to balance.  Changes in the market typically begin with the single-family product type then trickle down to townhomes, and finally to condominiums.

The single-family supply, prices and sales seem to be reaching an equilibrium with sales down 26% compared to December and down 31% compared to January 2021.  The supply of homes available to purchase has actually increased by 31% when compared to just last month, despite being lower than January of 2021.  Prices did continue to rise over the last month by about 8.6% bringing the average single-family home price to just over $1.8 Million in the Fraser Valley.  The increase is much lower than seen in previous months throughout 2021.   This means the single-family product is reaching a balanced market.

Multi-family product is still very much a seller’s market.  This includes townhomes and condominiums.  In both cases, prices are up by almost 8% and 5% respectively compared to last month. Inventory is up slightly compared to December however is significantly lower than it was a year ago in January 2021.  Because of this January 2021 saw the most sales in the condominium sector since 2015 and townhomes saw the 2nd highest level of sales in January since 2015.  This will most likely remain the case as the majority of homebuyers are priced out of the single-family market with an average price of almost $2,000,000.  Multi-family living is the new normal for the majority of homebuyers in the Fraser Valley.  With the townhome becoming the new family dream.

There have still been no new announcements from the provincial government on its new ‘cooling off’ period discussed in November and December. This will continue to be monitored closely and updated as soon as more information becomes available.

The Bank of Canada is expected to increase interest rates in March this year, followed by 3 more increases throughout 2022.  This is because Canada’s inflation rate is about 5% so far in 2022.  The hope is that inflation will decline to about 3% by the end of 2022 with the increases in the rate and cool markets (including the housing market) across the country.  This means each person’s buying power will be reduced with each rate increase.  If you qualify for a $530,000 mortgage today you may only qualify for a $500,000 mortgage after the rates change, assuming your income remains the same. If this happens a total of 4 times stated by the Bank of Canada it will continue to reduce the amount one qualifies to borrow or their buying power. Rising interest rates can reduce a person’s buying ability more so than rising prices in the end.  However, taking some people out of the market and reducing the purchasing power of others may help balance the multi-family aspect of the real estate market over the next year.  Prices most likely will not go down but will slow in the rate of increase mainly due to other costs of homeownership continuing to rise.

Pre-sales that offer a blanket appraisal from specific lenders are a great option to purchase today at today’s interest rates and see an increase in equity before any mortgage payments become due.  With the blanket appraisal the bank offering it holds the interest rate for 2 to 3 years depending on product type or until the new development is completed, unlike typical pre-approvals from the majority of lenders and mortgage brokers that only last 3 to 6 months, maybe 12 months if you are lucky. Pre-sales are also a great way to get in the market without having to compete against other offers as seems to be the way in resale offerings with the limited amount of supply of affordable multi-family options.

For anyone looking for pre-sale opportunities in the South of the Fraser River, The desirable South Surrey neighbourhood of South Grandview is the setting for a collection of timeless 3 and 4 bedroom executive townhomes. Spacious homes feature masters on the main and rooftop decks, and an amenity clubhouse encourages an active and social lifestyle. This parkside community is close to shopping, schools, and conveniences in South Surrey and White Rock, with easy access to highway networks. Experience the beauty of living well, at Hazelwood.



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