Warmer weather generates activity in Fraser Valley’s housing market
Home sellers and buyers in the Fraser Valley took advantage of the first warm spell of the year triggering an increase in new listings and keeping sales steady last month.
The Fraser Valley Real Estate Board posted 1,616 sales in May, an increase of 13 per cent compared to April and on par with the 1,608 sales processed on the Board’s Multiple Listing Service (MLS®) during May 2011. At the same time, the Board received 3,305 new listings, an increase of 5 per cent compared to April and 8 per cent more than were received during the same month last year. The new inventory took the number of active listings in Fraser Valley to 10,826, an increase of 8 per cent compared to the volume available in May 2011.
Scott Olson, President of the Board, says “Fraser Valley’s market is at an even keel. Since February, the ratio of sales compared to the number of active listings has stayed at 14 or 15 per cent, which means for every 100 properties available to purchase, 15 sold.
“It’s a healthy, competitive market. It gives buyers excellent selection and the time to negotiate, but not too much time. The average number of days to sell a detached home or a townhome is still only a month and a half and for condos a little over two months, which is why we’re seeing benchmark prices in most communities holding steady.”
The benchmark price* as determined by the MLS® Home Price Index (MLS®HPI) of a single family detached home in Fraser Valley increased 3.6 per cent in one year. It went from $528,900 in May 2011 to $548,000 last month.
In May, the MLS®HPI benchmark price of a Fraser Valley townhouse was $306,800, an increase of 0.8 per cent compared to $304,500 in 2011. The benchmark price of an apartment increased by 0.7 per cent year-over-year; going from $202,100 in May of last year to $203,600 in May 2012.
Olson adds, “We encourage buyers and sellers to talk to their REALTOR® about the difference between benchmark and average prices to better understand how we establish a recommended list price or an offer.
“A benchmark is the value of a home with characteristics “typical” to your neighbourhood, whereas the average is the dollar volume divided by the number of sales – so, if a significant number of higher priced homes sell in a given month it will skew the average high. This happened last spring when a number of communities in the Lower Mainland experienced higher than normal sales of luxury homes, which is why we’re still seeing average prices recovering while the benchmark has gone up.”
*Note: Benchmark prices underwent a recalculation this month in order to more accurately reflect trends measured by the MLS® Home Price Index (MLS® HPI.) There were no changes to the calculation of index values.
This recalculation involved aggregating benchmark prices using the sales weighted approach for the reference period (i.e. January 2005) and thereafter linking movements in aggregate benchmark prices to their corresponding MLS® HPI.