Winter is over, spring is here, and like clockwork, real estate market activity is picking up, at least according to March statistics published by the Fraser Valley Real Estate Board (FVREB) on Tuesday.
The year began with just 626 sales in January, which increased to 898 in February, and then spiked to 1,550 in March.
Although that total is still 39.9% lower than this time last year and 25% below the 10-year average, FVREB says it's the second straight month of sales improvement, the first time since August that sales have surpassed the 1,000 mark, and is overall an encouraging sign for the market.
The story with home listings is much of the same. The number of new listings increased by 32% from 1,938 in February to 2,559 in March, but remains low compared to both this time last year and the running 10-year average.
Those new listings bring the total number of active listings now to 4,530, up 2.8% from the 4,406 total last month. Once more, that measure is still below this time last year and the 10-year average.
The past is in the past, however, and signs are indicating that things are now heading in the right direction, and -- with the pause in rate hikes and seasonal trends -- there's reason to believe the Fraser Valley real estate market will continue in that direction.
"After months of uncertainty made it difficult for buyers and sellers to re-enter the housing market, we may well be seeing a turning point," said FVREB Chair Narinder Bains. "The pause in rate hikes has helped to restore a much-needed sense of predictability, which is building consumer confidence. As a result, we're starting to see more traffic at open houses along with more multiple-offer situations."
The Market Lean
With the above statistics, we can identify both the sales-to-active-listings ratio and the sales-to-new-listings ratio, two quantitative measures that can give us a sense of whether the real estate market in the Fraser Valley is leaning in any particular direction.
A sales-to-active-listings ratio below 12% is typically viewed as a buyers' market, while a ratio over 20% is viewed as favouring sellers, with anything in between an indicator of healthy balance.
With 1,550 sales and 4,530 active listings at the end of March, the sales-to-active-listings ratio is now 34.2%. That same number was just 20.3% last month, which indicates that sellers may currently have an advantage. (FVREB points out that sellers of townhouses may have an even stronger advantage, as the sales-to-active-listings ratio for that subset is now at 62%.)
With the sales-to-new-listings ratio, a ratio below 40% is usually considered a buyers' market, a ratio higher than 55% is viewed as a sellers' market, and anything in between is another sign of balance.
As March recorded 1,550 sales and 2,559 new listings, the sales-to-new-listings ratio is now 60.6%, also up fairly dramatically from the 46.3% last month, which reinforces the likelihood that the market is favouring sellers.
Prices Remain Elevated
"As in all regions across the province and the country, low supply is still an issue and a primary factor driving price growth," FVREB says.
Added FVREB CEO Baldev Gill: "While market demand continues to trend up, we still face an uphill battle on the supply side, which is keeping prices elevated. The province will require sustained inventory growth of at least 25% over each of the next five years in order to normalize inventories."
The residential composite benchmark price continues to increase and is now $965,100, up from $946,700 after February. By property type, the benchmark price is now $1,390,600 for single-detached homes, $794,400 for townhouses, and $521,800 for condominiums.
All three represent decreases when compared to March 2022, but are all increases of about 2% when compared to last month, serving as yet another indicator that we may indeed be at a turning point and that there may be better days ahead.