The Fraser Valley Real Estate Board posted 1,477 sales in May, a decrease of 2 per cent compared to the 1,501 sales processed on the MLS® during May 2009. At the same time, the Board received 3,457 new listings, taking the number of active listings to 11,411, an increase of 14 per cent compared to the 10,047 listings available during May of last year.

Deanna Horn, president of the Board, puts the numbers into context. “May’s sales were 16 per cent below our ten-year average, 1,760 sales for that month. Considering how busy the market has been in the last decade that represents solid sales activity, slower yes, but steady.

“What’s changed most is the increase in inventory. The last time this many homes were available on Fraser Valley’s MLS® in May was in 1995.”

Horn adds, “Tremendous selection allows buyers the luxury to find the right home, comparison shop and gives their REALTORS® the ability to negotiate hard on their behalf.

“For sellers, getting specific advice about home values in your local neighbourhood is crucial in a competitive market.”

In May, the benchmark price for Fraser Valley detached homes was $515,375, a 10.6 per cent increase compared to $465,939 in May 2009. The average number of days to sell a detached home in May was 43 days, one day faster than it was in May of last year.

The benchmark price of Fraser Valley townhouses in May was $328,295, a 10.1 per cent increase compared to $298,308 in May 2009. Townhomes in May sold on average 27 days faster than they did a year ago – 39 days compared to 66 days in 2009.

The benchmark price of apartments increased by 8.6 per cent year-over-year going from $232,170 in May 2009 to $252,221 in May 2010. The average days to sell in May for apartments in the Fraser Valley was 51 compared to 69 days during the same month last year.

Deanna Horn, president of the Board says, “March sales volumes can fluctuate as much as the weather, and this year’s reached the mid-point between the highs and lows seen over the last decade.

“However, available listings were near the peak, meaning buyers had lots to choose from and were clearly taking advantage of great buying opportunities.”

There were 3,395 new listings entered onto the MLS® in March, slightly higher than in March 2009, when 3,028 new listings were added. Altogether, there were 9,828 active listings on the MLS® at the end of March, on par with the 9,832 active listings one year ago.

The ratio of sales compared to active listings, which indicates the type of market, reached 16 per cent in
March, representing a buyer’s market. This is up from last year’s 10 per cent but a far cry from the 25 percent ratio in March 2007, when the Fraser Valley was in a seller’s market.

“Prices are closing in on the record highs we last saw in spring 2008, so it’s no surprise to see the increase
in listings as sellers position themselves to move up or downsize into a smaller residence using their home equity for their purchase.”

In March, the benchmark price for Fraser Valley detached homes was $514,787, an increase of 11.9 percent from the March 2009 price of $459,841.

The benchmark price of Fraser Valley townhouses in March was $326,307, a 10.3 per cent increase compared to $295,809 in March 2009. The benchmark price of apartments increased by 8.6 per cent year over- year going from $227,188 in March 2009 to $246,673 in March 2010.

1. All borrowers must meet the standards for a five-year fixed rate mortgage even if they choose a mortgage with a lower interest rate and shorter term (eg. if you qualified for a 3 year variable, you may not qualify for a 5 year fixed);

2. The maximum amount one can withdraw in refinancing their mortgage will be reduced to 90% from the current 95% of the value of one’s home;

3. Non-owner occupied properties will require a minimum down payment of 20%. This has a direct affect on those purchasing for investments and my phone has begun ringing as investors look to get into the market again before April 19th.

but there is a further change taking place with CMHC, regarding their rental offset calculation. This is a biggy if you want to buy rental properties and are trying to qualify with the rental income from a legal suite. CMHC is changing how rental income is used in a borrower’s debt service calculations (TDS formula)

Effective April 19th, 2010, CMHC will be changing the way they calculate rental income, no longer allowing for rental offsets. The new policy will involve a percentage of rental income to be added to the client’s (purchaser/buyers) gross income. The ratios and numbers are not yet solidified but when I have them I will post them.

It’s going to be more difficult to qualify for Buyer’s that are in need of rental income to keep the ratios in line.

I encourage you to make a decision very soon if you are thinking of buying as an investor or someone who needs to purchase with a suite.

You can still qualify under the current structure, but here are the changes that are coming:

- Down payment allowed from own resources, borrowed funds, or gifted from a family member. April 19th borrowed funds and gifted funds will likely disappear.

-80% rental offset allowed on all rental properties or legal suites that the client owns. April 19th offset discontinued. and now add percentage to income which will lessen the amount you will qualify for.

-CMHC will not insure a mortgage where 1 client owns more than 4 units in any one building. April 19 investor clients must have 20% down.

These are very tight restrictions and the water cooler thinking is they are doing this to shelter against possible interest rate increases. Stay tuned…

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Abbotsford, BC Home Foreclosures

Abbotsford, BC Condos and Townhome Foreclosures and Court Ordered Sales

There are many reasons that realtors do not host open houses anymore, but the number one reason is that the numbers do not lie. NAR (National Association of Realtors) released their yearly home buyers and sellers survey and the results for open houses were staggering. LESS THAN 1% OF REAL ESTATE TRANSACTIONS OCCURED AS A RESULT OF AN OPEN HOUSE. Now, there are other reasons (security risks, taking up the homeowners valuable time, etc…) but I know I would prefer to spend my time and effort on other forms of Innovative Marketing Techniques that have proven to work much better than 1% of the time.

So the next time your selling your home and interviewing agents, make sure that you let them know that less than 1% of homes sell because of an open house if they use open houses as part of their sales pitch. Ask them to be creative and innovative, or have them call me and I will give them some advice… or feel free to list with me!

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