Thursday, August 02, 2007

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.


mohican said...

Some other observations are:

Price compression by housing type is alive and well indicated by the higher appreciation figures for apartments (10+%), townhomes (7+%), and detached (6+%).

Fencesitter said...

Fill In The Blanks:

I'm looking for some detailed info from the FVREB releases, that is not up on their website archives. I'm looking for Aug/Sep/Oct '06 info for the following:

Detached Houses:
Langley: Average Price / Median Price / Sales Volume

All FV Areas: Average Price / Median Price / Active Listings

Does anyone have this info from their own archives, or can you point me to a source?


freako said...

Interesting that GV detached price fell MOM (by a fraction of a percent) despite very strong sales.

Ken said...

mohican; are you a fortune teller? First chart dates!

mohican said...

fencesitter: check this link out

ken - fortune teller isn't too far off but i'm probably even less accurate! I have a model that I am working on to attempt to forecast the supply / demand situation and subsequent price changes. The model is very rough and a work in progress. I figured I would post my sales and listings projections for fun to see if anyone noticed!

Patiently Waiting said...

Six or seven percent appreciation is bad news for speculators. They'd be better off with GICs. This is when some of the smarter bulls should recognize a change in the market.

oh please said...

I've been following the FV stats for a few years now and I can't remember the last time I saw that many negative numbers on detached homes. One month doesn't make a trend but maybe, just maybe, there's some hope this sucker is turning the corner.

Predictably, the summary makes no mention of any declines and reverts to YOY comparisons.

Ken said...

"The model is very rough and a work in progress" Hmmm then I suspect a change in the November to Feb listings, instead of the normal drop in listings I would venture that if we saw even a level listing number rather then a downward break in line with the seasonal decrease in sales, that figure (if it happens) would indicate a small portion of more desperate listings. I'll be watching that period with some interest.

New Meat said...

In terms of changing conditions, I noticed Trapanier Manor's ad in the Globe today (back page, first section) offering a boat or car as a housewarming gift.

This sounds like a desperation move on the developer's part, i.e. shades of 12th hour sales promos in the housing collapse in the US.

A funny thing is that this "environmentally friendly" (read perhaps- subject to a native claim/archaeology site)development doesn't permit owners to drive their cars to their "cottages". Rather, there's a shuttle service. So with your purchase you get a car that you can't park in your drive way. Now that's pretty inconvenient.

Fencesitter said...
This comment has been removed by the author.
Fencesitter said...

Thanks for the link Mohican.

I've been working on a model of langley housing, and it seems to have a strong correlation with the stats for all fraser valley areas. (as expected)

Interesting though that the average and median price gains for langley have slowed earlier than the rest of the FV. I agree that parts of the FV will be the leading indicator for a slowdown, and prices have already been reduced on many properties I have been following in parts of Langley by $30K-$50K.