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Fraser Valley Real Estate Market for January 1, 2017

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Blog by Liz Penner | January 11th, 2018

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Another big year for Fraser Valley real estate

SURREY, BC – The Fraser Valley housing market had its second highest selling year on record in 2017, with total MLS® transactions and dollar volume sold behind only 2016’s unprecedented level of activity.

The Board’s Multiple Listing Service® (MLS®) processed 22,338 sales in 2017, 7.3 per cent less than the record of 23,974 sales set in 2016. The total dollar volume of MLS® sales was $15.7 billion, coming out slightly beneath 2016’s record setting total dollar volume of $16.2 billion.

Of the total transactions for the year, 5,198 were townhouses sold and 6,183 were apartments, together representing over half of overall market activity for the region. This was also the highest total annual sales for apartments in the Board’s history.

“Much of the market’s momentum through 2017 came from the incredible shift in demand to attached-style homes, particularly in our larger communities,” remarked Gopal Sahota, President of the Board.

“While prices continued to see slight gains month-to-month, a lot of our attached inventory remained affordable and an excellent option for consumers of all types.”

For inventory, a total of 32,651 new listings were received by the Board’s MLS® system, the third highest in the Board’s history after 2016 (34,768) and 2008 (35,651).

Last month the Board processed 1,344 sales, the second-most transactions for a December on record in the Fraser Valley. December inventory finished at 3,818 active units, with a total of 1,277 new listings entering the market throughout the month.

Sahota adds, “All year, supply levels remained below where we’d like them to be, and that has put a tight grip on inventory and pressure on the pace of the market. This is still a challenging market for many consumers.

“However, if you have your finances in order, and the support of a local REALTOR® who fits your needs, you’ll be in the best position to make a move in 2018 and find success.”

HPI® Benchmark Price Activity 

• Single Family Detached: At $976,400, the Benchmark price for a single family detached home in the Valley increased 0.4 per cent compared to November 2017, and increased 14.2 per cent compared to December 2016.

• Townhomes: At $513,100, the Benchmark price for a townhouse in the Valley increased 1.5 per cent compared to November 2017, and increased 23 per cent compared to December 2016.

• Apartments: At $388,600, the Benchmark price for an apartment in the Valley increased 3.2 per cent compared to November 2017, and increased 40.5 per cent compared to December 2016.

I'm very pleased to announce that I've made the list of the top 10% of all Realtors for the Fraser Valley for the 10th year. I want to thank all of my loyal clients for sticking with me throughout the years. I look forward to another fantastic year of selling homes and working hard to make sure that your next purchase is a great investment and a wonderful place you can call home.
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Come Jan. 1, 2018, Canadians getting, renewing or refinancing a mortgage might have to prove that they would be able to cope with interest rates substantially higher than their contract rate.

New rules by Canada’s federal financial regulator announced in October mean that even borrowers with a down payment of 20 per cent or more will now face a stress test, as has been the case since January of 2017, for applicants with smaller down payments who require mortgage insurance.

Ottawa has already moved to tighten the rules around the mortgage market six times since July 2008, with a series of regulatory tweaks aimed at limiting the amount of debt that Canadians and financial institutions take on.

This is the seventh turn of the screw — and it could have a big impact.

Some 10 per cent of Canadians who got an uninsured mortgage between mid-2016 and mid-2017 would not have qualified under the new standards, a recent analysis by the Bank of Canada suggested. 


If you’re planning to buy a house with a downpayment of 20 per cent or more 

The stress test means that financial institutions will vet your mortgage application by using a minimum qualifying rate equal to the greater of the Bank of Canada’s five-year benchmark rate (currently 4.99 per cent) or their contractual rate plus two percentage points.

If you’re going be house-hunting next year, this may force you to settle for a less expensive home than you would be able to buy today. Or, you might have to wait and save up for a larger down payment.


If you’re renewing your mortgage 

Lenders don’t have to apply the stress test to clients renewing an existing mortgage.

This means that if you fail the stress test, you’ll probably get stuck renewing with your current financial institution, without being able to shop around for a better rate.

In some cases, “renewing borrowers may be forced to accept uncompetitive rates from their current lenders,” Dunning noted.


If you’re refinancing your mortgage


If you’re planning on refinancing your mortgage, you’ll have to qualify according to the higher stress-state rates rather than your existing contractual mortgage rate, explained James Laird, president at Toronto-based CanWise Financial.

Say, for example, that you bought a $400,000 home and have a $100,000 mortgage balance left. You’d like to borrow $50,000 more for a renovation. You have a five year fixed-rate mortgage at 3.3 per cent.

Last year, your lender would make sure that you can take on a $150,000 loan at 3.3 per cent, said Laird.

Now, your financial institution would have to vet that $150,000 loan using a 5.3 per cent rate. If you’re close to the borrowing limit today, you might have to settle for a smaller loan.


Article written by: By Erica Alini National Online Journalist, Money/Consumer  Global News 

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Elizabeth Penner
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