Prepare for the market to stay elevated next year: BCREA & Central 1 predict

by Laurie Dawson, FVREB Sr. Advisor, Communications

Unbelievable. Crazy. Nuts. Stressful. We heard it all. There aren’t enough words to describe how our members felt about this year’s housing market.

We understand and empathize. Because we see your level of busy-ness reflected in the Board’s MLS® data.

Our region’s total sales for 2021 are on track to blow our previous record highs – which experienced members will remember as the year 2016 and before that 2005 – right out of the water.

YTD sales almost match best year ever

In fact, our year-to-date sales as of the end of October are close to matching 2016’s total for the entire year. With November and December still to come, we’re at 23,917 residential and commercial sales combined. Total annual sales in the Fraser Valley for 2016 was 23,974.

Given the current market, REALTORS® likely get asked frequently, ‘what’s going to happen next year?’, ‘what’s in store for home prices?’, or ‘will 2022 be a good time to list?’

Although you may be experts on buying and selling real estate and the most knowledgeable professionals around regarding current home values, you still can’t predict what the future holds – but you know who can.

BCREA and Central 1: Respected sources for housing market forecasts in B.C.

And as your clients’ key real estate advisor, you can share forecast data with them and help them understand what it could mean to them. These outlook reports – issued four times a year by BCREA and two times per year by Central 1 – offer opportunities to connect with your clients and add value to your service.

BCREA’s fourth quarter Housing Forecast for B.C. was released last month. The entire report is valuable, but two key pages for Fraser Valley members are six and seven, which focus specifically on Greater Vancouver, Fraser Valley and Chilliwack.

What will follow the “busiest year ever”?

Chief Economist Brendon Ogmundson is projecting residential sales in our region will decrease a little over 15 per cent next year compared to this year and average home prices (combined) will continue to edge up – 3.7 per cent between 2021 and 2022.

It may sound negative that sales are projected to decline, but this is where your knowledge and expertise come in: decline compared to what? Context is everything.

You know that 2021 will go down as having the highest sales ever in our region and if BCREA’s projections for next year bear fruit, 2022 will rank the third best year ever in our history: 2021, followed by 2016 and then 2022.

(It’s worth noting that BCREA’s projections are for residential sales only, so if you’re comparing to our YTD sales in our MLS® summary in our Monthly Stats Package, you need to add on about another five per cent to factor in commercial sales, which we include in our grand totals.)

Rest up over the holidays – 2022 is going to be another busy year

Not to get too into the weeds, but based on BCREA’s forecast, our Board will post 27 per cent more sales next year compared to our 10-year average – that’s on average an extra 400 sales every month.

One positive takeaway you can share with your buyers is although sales will remain elevated, BCREA is not anticipating prices will continue to increase during 2022 like they have been. As it observes in the report, there are already signs now that prices “are flattening out”, which is why it’s projecting a more modest 3.7 per cent year-over-year increase for average home prices.   

Here’s that link again to BCREA’s latest forecast and a great bookmark for all BCREA market intelligence can be found here:

A great second source for housing forecast intel? Bryan Yu, Chief Economist, Central 1

Like in journalism, you always want two reputable sources. In addition to BCREA, Central 1’s economics team is highly respected for its housing market analysis – in fact, Bryan Yu, was a senior economist with BCREA prior to moving to Central 1.

Central 1 just released their B.C. Housing Outlook 2022-2023 report, which includes their housing forecast for the entire province – they don’t break it down by region. The key takeaways, similar to BCREA; provincial home sales will moderate but stay strong and price growth will slow. Bryan Yu is projecting sales will decrease by 21 per cent in 2022 and median prices will increase by 4 per cent.

For access to all of Central 1’s economic analysis, insight and forecasting: