Many may have been hoping that real estate market activity would improve after the Bank of Canada began cutting its policy interest rate, but that has yet to occur in the Fraser Valley, according to new statistics published by the Fraser Valley Real Estate Board (FVREB) on Friday.
According to the FVREB, a grand total of 1,230 sales were recorded in July, which represents a 7% decrease from June and a 26% decrease from the 10-year average for July.
On the other side of the equation, July saw 3,412 new listings added to the market, and that figure is about flat from June, bringing the total amount of active listings in the Fraser Valley now to 8,731, which represents a 5% increase over June and a 41% increase over July 2023.
"Despite back-to-back policy rate cuts by the Bank of Canada, many first-time homebuyers are still facing challenging market conditions — high interest rates, the mortgage stress test and the need for a substantial down payment," said FVREB CEO Baldev Gill.
Buyers or Sellers
With the aforementioned statistics, we can identify the sales-to-new-listing ratio, as well as the sales-to-active-listings ratio, which are two quantitative indicators that can give us a sense of whether the market is currently leaning towards buyers or sellers.
For the sales-to-new-listings ratio, a ratio of 40% or lower is considered a buyers' market, a ratio of 55% or higher is considered a sellers' market, and anything in between is considered a sign of market balance.
With 1,230 home sales and 3,412 new listings in July, the sales-to-new-listings ratio is now at 36.0% after being at 38.5% after June, indicating that the Fraser Valley market is in buyers' market territory.
For the sales-to-active-listings ratio, 12% or lower is viewed as a buyers' market, 20% or over is viewed as a sellers' market, and anything in between is viewed as a balanced market.
With 1,230 home sales and 8,731 total active listings after July, the sales-to-active-listings ratio is now at 14.1% after being at 15.7% after July, again indicating movement towards buyers' market territory, although the market may still be at a balance.
Pricing and Outlook
Following July, the composite residential benchmark price is now $999,100, which is the first time it has fell under $1M since January 2024.
By property type, the benchmark price is currently $1,629,600 for single-family homes, $848,800 for townhouses, and $551,000 for condominiums. Compared to June 2024, those benchmarks have increased by 0.1% for single-family homes, decreased by 0.3% for townhouses, and remained flat for condominiums. Compared to July 2023, however, all three represent minor decreases of between 0.1% and 0.5%.
"Amidst an overall balanced market, some REALTORS® are experiencing pockets within the Fraser Valley that favour buyers, where prices have come down," said FVREB Chair Jeff Chadha. "This is evident in the amount of time buyers have to view a property before considering making an offer. Properties that are well-priced are selling quickly, suggesting motivated buyers are active in the market despite the slowdown."
According to the FVREB, in July, the average number of days for a single-family home to sell was 31 days, while the average was 25 days for townhouses and 28 days for condominiums.
