Will 2016 be a repeater?
Last year, Fraser Valley REALTORS®
experienced the best year in home sales in a decade. Will this year be as good?
In short, no because it's hard to top near
record-breaking two years in a row; however, according to the experts, 2016
will be another strong year for Fraser Valley's housing market. This year's
market is expected to echo how sales in 2006 and 2007 gradually decreased from
2005's all-time sales high.
In a monthly statistics conference call
between FVREB and REBGV officers, BCREA's Chief Economist, Cameron Muir,
pointed out that markets historically do not shift quickly, or dramatically
"pending an economic shock such as a significant decrease in interest
rates."
He has forecast that Fraser Valley's
residential MLS® sales will decrease by 8.3 per cent in 2016 compared to 2015,
which would result in the Board posting 18,500 sales in total (residential and
commercial combined) this year – still 14 per cent higher than the ten-year
average.
At Vancouver's CMHC Housing Outlook
Conference in November, Market Analyst Richard Sam's forecast echoed BCREA's
projecting the same decrease in sales – 8.3 per cent – for the Fraser Valley
this year compared to last. Interestingly, CMHC anticipates a 'softer landing'
for home sales in the Abbotsford-Mission Central Metropolitan Area (CMA) and is
forecasting a decrease of only 2.4 per cent in 2016, so almost as strong a year
as last year for our members serving clients further out in the Valley.
One reason for continued strength in sales
in Abbotsford/Mission is likely affordability. As FVREB President Jorda Maisey
explained to reporters in the Board's December statistics release, "The
Fraser Valley has always appealed to consumers looking for competitive pricing
and a diverse range of housing options.
"Last year shows that consumers
recognize the long-term value of property ownership in the Fraser Valley,
particularly valuing the single family home, which they recognize is becoming a
limited commodity. Sales of single family detached increased across all of our
communities, in some instances more than doubling 2014's sales."
In 2015, the strong demand in our region –
and lack of competitively priced inventory – for single family detached homes
had a clear impact on prices. In December 2015, MLS® Home Price Index Benchmark
prices were up an astounding 17.3 per cent compared to December 2014.
Year-over-year, average prices for FVREB detached homes increased by 12.1 per
cent. Contrast that to BC's rate of inflation last year, which hovered around 1
per cent.
Economists predict that even though MLS®
sales will dip this year, demand for single family homes will remain robust,
which will continue to put upward pressure on prices. Muir forecasts the
average MLS® price of single family homes in the Fraser Valley will increase by
4.8 per cent in 2016; townhome prices will increase by 3.5 per cent and
apartments, 2.6 per cent.
~ Fraser Valley Real Estate Board
