At the risk of sounding repetitive, the Fraser Valley residential real estate market continues to buck seasonal trends, ignoring the typical summer slow-down. August statistics from the Fraser Valley Real Estate Board (FVREB) posted more record-breaking sales numbers, lower average days on market and, consequently, price increases. This, all in a month where, historically, the opposite is reported.
Total sales in August finished 42% higher than the 10 year monthly average and compared to August 2019, 62% more townhomes and 72% more detached homes were sold. It’s been more than a decade since we have seen sales this high in any August. Year to date, total sales are 12% higher than this time last year. Home buyers are clearly making up for lost time, and then some.
As home buyers’ priorities shift to summer holidays, we usually expect to see an uptick in active listings, increased average days on market and a temporary build-up of listings. This August did see an increase in active listings but where it is typically double digits, we saw an increase of only 1-3% depending on home type. Total active listings for August ended the month at only 87% of the 10 year average.
Competition among consumers is holding steady in the townhome and detached home segments with the sale price of townhomes and detached homes edging 0.6% closer to list price and average days on market dropping significantly. The condo market followed more seasonal trending with a mild decrease in sale price as a percent of list price and an increase in average days on market.
The result of this record-breaking activity and persistent demand is yet another month-over-month increase in HPI Benchmark Prices for detached homes and townhomes at 1.2% and 0.1% respectively. Condos are holding steady from last month. Incidentally, it would appear even a global pandemic can’t shake up the persistent growth trends of real estate values in the Fraser Valley over the long term. The FVREB reported the following year-over-year increases for August’ Benchmark prices:
- Single Family Detached Homes – 6.9%
- Townhomes – 3%
- Condos – 6.9%
What does this mean for development land in the Fraser Valley?
An uncharacteristically active resale market is making for an atypical residential land market this summer. The fear of missing out on a hot resale market has builders scrambling to acquire their next site, ideally one with entitlements to expedite the delivery of new homes to market. As a result, we are seeing multiple offer situations put upward pressure on land values and shorten the length of due diligence and completion time. Understandably, the bulk of the demand is for townhome and single family sites as those are the highest performing segments of the resale market, but demand for condo land is not far behind.
Land with an extended timeline to development (5+ years) is also benefitting from the positive sentiment in the market but only in so far as a broad renewal of interest; we have yet to see any meaningful impact on prices or deal terms.
Check out our curated summary of the Fraser Valley Real Estate Board’s August stats in infographics below.
View the Fraser Valley Real Estate Board’s entire stats package for August 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.