July 2007 Fraser Valley Real Estate

Press Release – Sales on the Fraser Valley Real Estate Board's Multiple Listing Service® (MLS®) in July were the second highest on record for that month.

A total of 1,984 sales were processed through the MLS® in July, an increase of 21 per cent compared to 1,635 sales the same month last year, and only a three per cent decrease compared to the strongest July on record, 2,051 sales in 2005.

Jim McCaughan, President of the Fraser Valley Real Estate Board, attributes July's near record sales to a number of factors. "BC's economy continues to hum along, Fraser Valley REALTORS® are receiving a strong influx of new listings and some of our clients are feeling a little uncertainty about where interest rates are going. It all adds up to a desire to invest in real estate now."

The number of active listings in July at 8,376 is 35 per cent higher than July 2006 inventory which sat at 6,200. A total of 3,120 new listings were added to the MLS® in July, compared to 2,657 new listings added in July of last year.

"Average annual price increases remain solid, however we are seeing price increases start to moderate on a month to month basis," says McCaughan. "Demand is strong for townhomes and apartments in Surrey, Langley, Abbotsford and Mission, which is why we continue to see an increase in both the number of sales and prices for those property types."

Townhouses in the Fraser Valley averaged $323,259 in July, a 7.1 per cent increase compared to the average price last year of $301,718. Apartments saw the highest July to July increase at 10.8 per cent with the average price going from $198,882 last year to $220,275 this year.
In July, single family detached homes averaged $519,896, an increase of 6.2 per cent compared to last year's average price of $489,547.

Months of inventory hit 4.4 and will likely rise for the remainder of the year as sales slow and listings increase. Months of inventory has a high correlation to price changes.

Median prices were mixed, as predicted, with detached homes lower, apartments lower, and attached marginally higher. The lower medians indicate that the sales mix is shifting to cheaper accommodation as being the only affordable option for most buyers. Benchmark prices were higher in all categories.

Year over year prices changes peaked in June 2006 at 23.6% YOY and have been declining ever since. My model indicates that the annual price changes should turn negative in the first quarter of 2008 as inventory is likely to keep increasing and sales continue decreasing.