As everyone reading this knows, there has been nothing typical about the year 2020. However, if there is one area where trends have stayed true to the predictions, it would be the rate at which homes sell.
In recent years, buyers and sellers and everyone in between have looked on in awe as houses in Metro Vancouver have sold and sold — and then sold some more. Despite the shadow of a public health crisis, 2020 has stayed true to pre-pandemic predictions and has not seen an exception to this rule. In fact, in Surrey and the Fraser Valley, 2020 saw the shattering of home sale records.
To be specific: in the month of October alone, Surrey and the Fraser Valley saw 2,370 home sales. This represents a 48.9% increase over the same period in 2019 (source: the Fraser Valley Real Estate Board). That’s nearly twofold!
Why Are So Home Sales Up in a Pandemic?
A hot housing market may seem very out-of-place within the context of the year 2020, where many individuals have had their employment cut or even removed. However, despite this year’s economic setbacks, economists have theorized that record low-interest rates have many potential buyers seeing the current times as an opportunity that they don’t want to miss.
Additionally, it is possible that those who have been fortunate enough to save their money over recent months feel as if the housing market is a safe place to make an investment. It is possible that they see other areas for investment as riskier in the unpredictable climate.
Lastly, a low inventory of homes for sale may have many feeling like they need to pull the buying trigger earlier than they may have felt in the past. This feeling is perpetuated by the fact that most homes spend a very short time on the market, giving potential buyers the impression that if they don’t act now, the house of their dreams may be gone forever.
What is Attracting Buyers to Surrey and the Fraser Valley?
The 2,370 homes that sold were all within the following municipalities: Surrey, North Delta, White Rock, Langley, Mission, and Abbotsford.
Even on the surface, it’s not so difficult to see what may be driving the demand for houses in this area. With many potential buyers priced out of the urban center of Vancouver, it is natural for them to look further afield. Surrey and the Fraser Valley is within commutable distance of downtown Vancouver, and also offers access to public transit for those who prefer to not take their car.
Aside from its proximity to the big city, these areas also have a lot to offer in their own rights, such as complete shops and services. Some communities, such as Langley, also offer a slower pace of life which may appeal to some buyers.
How are Home Sales Trending Across Canada?
Home sales in Metro Vancouver are not always indicative of the rest of the country, so let’s take a look at how pandemic home sales are faring in other areas.
Although the Canadian Real Estate Association (CREA) has reported that October home sales were down 0.7% when compared with September, it’s worth noting that home sales are still at record high levels. To put things in perspective: compared to October 2019, October 2020 saw an activity increase of 32.1%.
Will Record Home Sales Increase Prices?
Following the logic of supply and demand, it makes sense that these record home sales have many potential buyers and homeowners alike wondering the same question — will these record home sales increase the average prices in the area?
In short, yes. In fact, it is likely that we are already seeing this reflected in the current housing data. This is especially the case in Langley where, according to the Aldergrove Star, the average home price has soared to just shy of one million dollars at $1,078,100. This represents nearly a 10% increase over the previous year’s average price, which was $982,300.
While the increase is most prevalent among single-family homes, townhouses and condo prices are also rising and don’t seem to be showing any sign of slowing down.