Fraser Valley residential real estate

What the residential home market is doing and
how it's impacting the development land market

By Mike Harrison

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Key Take-Aways from the January Statistics

The Fraser Valley Real Estate Board’s home sales data has been released for January and the year is off to a strong start. Some of the acceleration in the market can certainly be attributed to natural seasonality, but to see this many of the key metrics moving in a favourable direction already in January, is less typical. Is it pent-up demand stepping back onto the playing field after standing on the sidelines waiting for less market uncertainty? Whatever it is, it is welcomed good news.

Highlights from the January statistics include:

  • Benchmark Prices displaying signs of having reached a turning point which is most obvious when viewed on the charts below. Detached and townhome prices saw only 0.4% and 0.1% decreases compared to last month’s 1.2 to 1.4% decreases. Condo prices even saw an increase.
  • A sale price as a percent of original list price increase for all home types, suggesting buyers have become more active.
  • Days on market holding flat for townhomes when typically, all major home types would still be rising in January.
  • A significant jump in sales, month-over-month, which has only been seen one other January in the past 10 years.
  • A massive spike in new listings, compared to last month. Detached homes lead the pack, with nearly 3 times as many listings as December.
  • Almost no increase in Active Listings despite the enormous injection of new listings, suggesting buyers are back. Active listings of detached homes even declined 1.7%, month-over-month.

How the Fraser Valley land market is reacting

It was an early Spring thaw for the residential land market in the Fraser Valley too, fueled by a promising outlook for interest rates, goods news stories coming from resale agents and most new project sales centres reporting a spike in absorption even of units that had been sitting since Fall

In January we saw a spike in inbound inquiries from developers and investors looking to get their hands on the next development site before inventory dries up again. Optimism and confidence are clearly back but only in so far as purchasers are willing to write offers; buyers of development land remain cautious and vigilant in their pursuit, avoiding complicated development sites or short completion timelines as financing remains a significant hurdle for many.

The bid/ask price gap remains a struggle in many areas as sellers of development land hold out hope for prices of yesterday. For the few properties that come up which are priced well, there is no shortage of potential purchasers willing to put pen to paper. We’re seeing multiple offers again in those cases.

A snapshot of key metrics

January 2024

Detached homes

The single family detached home market is consistently the first segment to move, either up or down, when the market is shifting. As a result, we look to this segment as an indicator for market directionality and velocity. 

Home sales in the Fraser Valley

The following charts summarize the month’s total home sales throughout the Fraser Valley.

Days on Market 

Days on Market is the average length of time listings of that home type stayed on market before selling firm. This metric is an indicator of competition among buyers and the month-over-month change can tell us whether the market is accelerating or decelerating. 

New and active listings in the Fraser Valley

New listings is the cumulative quantity of listings posted for the month. Active listings is the quantity of active listings on the last day of the month. 

Listings over time

 

Listing metrics tend to be seasonally cyclical making month-over-month reports misleading as indicators of market shifts. The below chart shows each month's active and new listings over the past decade. The current month is highlighted on each line to illustrate how today's data compares to the past 10 years of data for the same month.

HPI benchmark prices

HPI Index establishes "Benchmark Prices" for a typical home in each major housing category. Benchmark Prices, as a relative metric, tend to be a more accurate indicator of market direction and velocity as they are not subject to the composition of home types being sold, like average home prices. 

For more information on the residential development land market in the Fraser Valley or to sign up for my monthly newsletter, please contact:

Mike Harrison

    • Principal, Development Land Sales
    • Land and Development
[email protected]

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Data sourced from Fraser Valley Real Estate Board