Housing price increases in Fraser Valley outpace Vancouver
Latest CMHC market assessment says reason is push to buy cheaper condos in North Delta, Surrey and Langley
The Canadian Mortgage and Housing Corporation says demand for less expensive condominiums and apartments in North Delta, Surrey and Langley has inflated prices at a sharper rate than in Vancouver.
The CMHC's latest Housing Market Assessment for the first quarter of 2018 shows that year-over-year increases in property sales under the Fraser Valley Real Estate Board (FVREB) were 15 per cent compared to 10.4 per cent under the Real Estate Board of Greater Vancouver.
The largest increases were for apartments or condominiums, some of which increased more than 50 per cent, according to the CMHC.
The increases are based on the benchmark price composite, which tracks changes to middle-range or typical homes and excludes extreme high-end and low-end properties.
'Most affordable units'
Eric Bond, a regional analyst with CMHC, says people are seeking out property in the Fraser Valley for a simple reason.
"Those municipalities have some of the most affordable units in the region, particularly for condos," he said.
"For first-time buyers, given the price increases we've seen in the rest of the region, often those units are what's most interesting to them."
The prices in CMHC's report are further evidence that people are scrambling to find something affordable outside of Vancouver or other areas.
However, it now appears that moving to the Fraser Valley is no longer an option to avoid sticker shock.
Statistics from the FVREB from December show the benchmark price for a townhouse went from $417,200 in 2016 to $513,100 in 2017.
Apartments increased from $276,600 in 2016 to $388,600 in 2017.
"So we've now seen some strong price increases in those areas due to the demand for that more affordable product," said Bond.
The CMHC says overall single detached home prices increased 2.8 per cent in the area covered by REBGV, while townhouses and apartments were up 13.6 per cent and 19.7 per cent, respectively.
The report says the increases are due to a low number of active listings on the resale market.
"The resulting low inventories of homes for sale continues to put upward pressure on prices," it said.
Meanwhile, the assessment continues to paint a gloomy picture for housing in areas like Vancouver and Victoria.
Housing markets there continue to be "highly vulnerable" due to price acceleration and overvaluation.