Happy New Year!  I wish you and your families a healthy and prosperous 2014. 

Another year has come and gone and what a year it is has been.  There was significant media attention given to the real estate market in the Lower Mainland.  It felt like not a day went by that some news outlet was reporting something about real estate.  And it was not just about homes prices. 

We have and continue to be told that Canadian household debt levels are at stratosphere highs and the government is concerned.  New reports are suggesting that Canadians are deciding to save more but debt levels currently are still high.  There continues to be much talk about a correction or a “soft landing” or no changes at all in the real estate market.  It seems that everyone has an opinion. 

The Bank of Canada has done much over the past few years to control the real estate market with respect to mortgage lending rules.  This has had a positive effect on the market and frankly I agree with some of the changes.  Our homes should be viewed as long term savings and wealth creation not as an ATM machine to pay for travel and fun.  Many homeowners are trying to do this by taking out lines of credit on their homes to pay for luxuries.  This is not the best long term investment strategy.

What we now know is that 2013 was a fantastic year in real estate.  The market stayed fairly consistent over 2013.  Balanced markets can be some of the best types of markets for real estate.  Sellers achieve their goal of selling and Buyers achieve their goal of not having to be in multiple offers.  Although in every market there are multiple offer situations, in balanced market conditions a multiple offer is far less common. 

What was encouraging to see was that 2013 saw a return to normalized sales levels as opposed to 2012.  Sales were up 14% over 2012.  This is still 11.9% below 2011.  The total number of homes listed on MLS was also lower by 6.2% compared to 2012.  The really interesting number is Home Price Index (HPI) which increased by only 2.1%.  Meaning homes prices were pretty stable as well.

“Home sales quietly improved last year compared to 2012, although the volume of activity didn’t compare to some of the record-breaking years we experienced over the last decade,” Sandra Wyant, REBGV president said.

With respect to sales, SFU actually saw a decrease of approximately 21% in unit sales in the resale market only.  Average prices increased albeit marginally by 1.014% on a dollar bases and not using the Home Price Index. 

Here is a summary of 2013 vs. 2012 performance for SFU, UniverCity

	2013	2012	% Difference
Number of Sales	57	69	-21%
Avg. Price	$374,756	$369,247	1.014%
Avg. cost per sqft	$399.98	$412.56	-1.03%
Avg. Days on Market	62	46	34%

                                    

This brings us to current market conditions on the mountain.  Inventory levels are actually very low at only 40 active resale listings as of January 29, 2014.  Prices range from $199,000 for a 421 sqft studio unit to $499,900 for a 1170 sqft concrete condo.  Average list price is $368,215 or $439.05 per sqft.  What is encouraging to see is that there have already been 2 sales registered for 2014.

Low inventory levels, low interest rates and the relatively milder winter SFU is currently experiencing are all signs that UniverCity at Simon Fraser University should perform well in Q1 of 2014.  Activity has already been very good at open houses and, in my personal experience, with active listings. 

Contact us now if you have questions about the market in general or specifically if you would like to learn more about the Simon Fraser University area.