April housing market statistics are now available from the Fraser Valley Real Estate Board and it would appear even a global pandemic can’t keep Benchmark prices from rising in the Fraser Valley. The measures put in place to combat the COVID-19 pandemic are having an unprecedented impact on the real estate market but it’s showing unexpected signs of resiliency.
Understandably, sales plummeted, making this April the slowest in over a decade with total sales hitting only 41% of the 10 year average. Sales of detached homes dropped 54% from March, condos dropped by 55% and townhouses by 48%. Consistent with the general lack of activity in the market, active listings were also down 16-33% from this time last year.
What we didn’t expect to see were month-over-month increases in the HPI Benchmark price of all major residential home types. The detached home price increased by 0.5% from last month, condo by 0.2% and townhouse by 0.7%. These month-over-month increases resulted in year-over-year increases for all home types with detached homes up 3%, condos up 0.8% and townhouses up 1.4% over April 2019.
Even though sales activity dropped off a cliff, the quantity of new listings in April declined by an even greater amount, which is likely what drove the stability in Benchmark prices. New listings of detached homes were 63% lower than April 2019 with condos and townhouses seeing similar declines of 51% and 58% respectively.
Sale price as a percent of list price typically increases for all home types in April as we near the annual peak of the market but, as expected, we saw mild decreases for all major home types. Similarly, the reduction in buyer activity resulted in an increase in average days on market for attached homes; however, detached homes still sold faster in April than in March.
What does this mean for development land in the Fraser Valley?
The COVID-19 pandemic continues to cloud crystal balls but the common speculation is that we should return to pre-COVID market conditions within 6-12 months.
Furthermore, the pricing stability in the market, announcements of plans to re-open the economy and sales centres reporting increased activity over the past 10 days, has many seeing a light at the end of the tunnel. As a result, confidence among development land buyers is improving.
Even with a pandemic, the reality is we still have far more development land buyers in the market than we have viable sites and 6-8 weeks of uncertain market conditions, brought on by what is perceived to be a temporary health issue, hasn’t been enough to create “fire sale” conditions some buyers are hoping for. Land values tend to be quite sticky so those hoping for an amazing COVID-19 discount will likely be disappointed.
With that said, we have noticed a mild uptick in land owner’s appetite to look at an offer for sites they had previously been opposed to selling. Developers and home builders are taking this opportunity to purchase these previously unavailable sites with better terms than we have seen in a long time.
Check out our curated summary of the Fraser Valley Real Estate Board’s April stats in infographics below.
View the Fraser Valley Real Estate Board’s entire stats package for April 2020 here.
This representation is based in whole or in part on data generated by the Fraser Valley Real Estate Board which assumes no responsibility for its accuracy.