Fraser Valley real estate to continue as a seller’s market in 2021, prices to increase by 2%
Fraser Valley real estate is expected to continue as a seller’s market in 2021. Fraser Valley saw an uptick in move-up buyers coming from Vancouver as many are looking for larger properties outside of the city. The average selling price in Fraser Valley increased 6.9% to $701,031 in 2020 (Jan. 1 – Oct. 31) compared to $656,067 in 2019 (Jan. 1 – Dec. 31). The RE/MAX Outlook for Fraser Valley real estate in 2021 is an increase of 2% to approximately $715,051.62.
Who’s Driving Demand for Fraser Valley Real Estate?
Move-up buyers are currently driving demand in the Fraser Valley real estate market, due to an uptick in the number of people coming from Vancouver. The most popular property type among move-up buyers are single-detached homes.
First-time homebuyers in Fraser Valley are typically young couples looking for condominiums and one-bedroom apartments ranging in price from $400,000 to $500,000. If interest rates remain low and people adjust to the new normal surrounding COVID-19, it may be easier for first-time homebuyers to enter the market, however, this is not a guarantee.
The move-up buyer market in Fraser Valley is driven primarily by families. There has been some hesitation from move-up buyers looking to enter the market in 2020. Some potential buyers are more hesitant because they are comfortable where they are at but are still moving ahead with a purchase.
The condominium market in Fraser Valley is currently driven mostly by single homebuyers, students, and young couples. The average price for condominiums in Fraser Valley in 2020 was $408,403. The Fraser Valley condo market has seen a falling demand for condominiums because of COVID-19, which is expected to continue into 2021.
The luxury market in Fraser Valley has been driven primarily by established families, with the typical starting price for a luxury home in Fraser Valley being approximately $1,500,000. Pre-pandemic, luxury housing prices were lower, but due to the pandemic, many people are looking for larger homes with more space, which has resulted in an active luxury market. Many families that are purchasing luxury properties are blended families or families made up of multiple generations.
Fraser Valley’s Hottest Neighbourhoods
Fraser Valley’s top selling neighbourhoods in 2020 were City Centre (Surrey) and Chilliwack, as well as Abbotsford. Surrey has become urban, while Chilliwack is seeing first-time homebuyers and people needing more space. Chilliwack is expected to continue to be the most popular neighbourhood in 2021.
Fraser Valley New-Home Construction
Fraser Valley’s new-home construction market is low compared to demand and could use more new-construction builds to meet the current demand. New-home sale prices are like those of re-sale properties in Fraser Valley.
Canadian Housing Market in 2021
Canadians are on the move. RE/MAX isn’t calling this an “exodus,” but the re-location trend across the Canadian housing market is real, and it’s just one focus of the RE/MAX 2021 Housing Market Outlook Report. RE/MAX Canada anticipates healthy housing price growth at the national level, with move-up and move-over buyers continuing to drive activity in many regions across the Canadian housing market. An ongoing and widespread housing supply shortage is likely to continue, presenting challenges for homebuyers and putting upward pressure on prices.
Due to these factors, the 2021 RE/MAX 2021 outlook for average residential prices is an estimate of +4% to +6% nation-wide. Here’s the regional break-down:
35% of RE/MAX brokers indicate that “move-over” buyers from other cities and provinces will continue to spark market activity in 2021
45% of RE/MAX brokers indicate that move-up buyers will likely be a primary driver of the housing market demand in 2021
Half of Canadians (53%) are confident that Canada’s housing markets will remain steady in 2021
52% of Canadians believe real estate will remain one of the best investment options in 2021
“Despite the tragic impacts of the pandemic, our optimism in the strength of Canada’s housing market has always remained,” says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. “While we’ve seen a significant shift in buyer preferences this year, we believe factors such as the supply issue, pent-up demand and historically lower interest rates will continue to fuel activity in 2021.”
Fraser Valley to experience buyers market in 2020, prices to increase 2%.
The Fraser Valley housing market is currently witnessing a buyers market due to the substantially higher inventory compared to the previous year and more buyers qualifying for the stress test as they become more adjusted to it. The RE/MAX average sale price expectation for Fraser Valley is +2% due to an expected course correction in the market.
The region’s population growth is expected to have the biggest impact on the market, especially due to more Vancouverites moving to the region as they are being priced out of the market. The relative affordability of the area compared to Vancouver keeps it a hot real estate market.
Watch out for the Surrey City Center neighbourhood, whose development is expected to drive more buyers to the area. Development in downtown Surrey, particularly high-rise condos, has not only attracted more buyers but also more companies and educational institutions to the area.
First-time and foreign buyers are expected to drive demand in 2020, especially as millennials amass more spending power.
From a national perspective, RE/MAX anticipates a leveling out of the highs and lows that characterized the Canadian housing market in 2019, particularly in Vancouver and Toronto, as we move into 2020. Healthy price increases are expected, with an estimated 3.7-per-cent increase in the average national residential sales price.
“The drop in sales in key markets across British Columbia can be partially attributed to Canadians’ increasing difficulty in getting an affordable mortgage in the region,” says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. “The situation created by the introduction of the mortgage stress test this year, as well as continually increasing interest rates, means more Canadians will be priced out of the market.
A home is the biggest transaction most of us will ever make. That’s why it’s important to work with an experienced and knowledgeable real estate agent. For more than 20 years, RE/MAX has been the leading real estate organization in Canada and beyond. With a presence in over 100 countries and territories, the RE/MAX network’s global footprint is unmatched by any other real estate brand. RE/MAX has always been an industry leader, adopting the latest technology and creating innovative marketing programs. RE/MAX was the first brand to expand its reach world-wide through a revolutionary global listing site, featuring listings from more than 80 countries, displayed in over 40 languages. Closer to home is RE/MAX’s deep commitment to the communities we operate in. Our exclusive Miracle Home Program allows RE/MAX agents to donate a portion of every home sale to Children’s Miracle Network.