Surrey Real Estate

Trends and Price Forecast

Surrey, BC


  • Surrey house prices have dropped close to $50k since peaking in 2018 and the benchmark house price dropped below $1 million. Surrey house prices recovered a over the past few months but with house prices dropping in other parts of the lower mainland this surge is likely short-lived.
  • Surrey condo prices are also down since their peak in 2018.
  • Higher-priced Lower Mainland markets like Downtown, the Westside, and West Vancouver have been hit hardest but the surrounding areas are all impacted.
  • There has been an increase in Surrey home purchases this Spring however it is still slower than prior years and there are many homes for sale.
  • As we enter the Summer months, some sellers will likely accept price concessions rather than wait to re-list next Spring.

Economists broadly agree that higher interest rates and tighter mortgage rules will have a larger, longer-lasting dampening effect on home sales than we previously thought. B.C. is also impacted by new registries designed to keep dirty money out of the market. As a result, foreign investment has shifted to Toronto and Ottawa. As well, there are now fears of Canada hitting a housing induced recession.

This article covers:

  • Where are Surrey prices headed?

  • What are Surrey Purchase and Listing Trends?

  • Should investors sell?

  • Is this a good time to buy?

1. Where are prices headed?

Over the past 10 years, the price of a Metro Vancouver house has doubled. That’s the equivalent of prices rising 7% every year while people’s incomes increased by an average of 1.5% over the same timeframe.

In the summer of 2016, Vancouver house prices tumbled after the introduction of a foreign buyer tax and subsequently recovered. The 2016 drop in prices was much steeper than the one seen today, and it raises a question about the degree of volatility in the market. If prices can jump $600,000 between 2014 and 2016, drop $100,000 in 2016 and then recover, could they drop by $400,000 between 2018 and 2020 before a recovery sets in? House prices in North Surrey have already dropped over $60,000 from their 2018 peak so another bad year could bring house prices down to $900 thousand. A significant discount but still beyond the reach of most locals.

North Surrey is not alone. Central Surrey and Cloverdale houses also saw price drops since peaking. Prices have bounced up recently however given the continued price drops in the rest of Metro Vancouver, Surrey is likely to follow.

It is possible Surrey house prices are at hit a tipping point. This doesn’t mean you don’t buy a home for your family, but it does mean that you’re buying it for shelter and not as a low-risk investment. It also means you can drive a hard bargain.

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Metro Vancouver condo prices also doubled over the same timeframe but in the past 10 years had never experienced a downturn until last summer.

If you’re looking to buy or sell a home in the next three years, you’ll want to pay closer attention to recent trends. With fewer buyers in the market, sellers have begun to lower their expectations, and prices have dipped in recent months.

Since peaking in the Summer, condo prices have dropped in Surrey and that’s good news for first-time home buyers.

First-time buyers who earn $100,000 a year and have saved up $50,000 can afford a home priced around $425,000 so the run-of-the-mill Surrey condo is just within their reach. House prices are still well beyond the reach of most households and with prices now dropping, they are losing equity in their current homes. They would need a substantial gift from the “bank of mom and dad” to make up the difference.

The Surrey condo market has historically been a lot tighter than the house market, but it has lately been flirting with a balanced market. A balanced market is generally considered healthy, yet as soon as the condo market balanced, prices began to drop. There is a risk that current condo prices are not sustainable in a healthy balanced market and a full-blown buyer’s market could lead to deep price discounts.

Whether you’re buying or selling our match finder app can find you a realtor and mortgage broker who shares your priorities and specializes in your local area.

2019 Surrey House Price Forecast

In 2018, the most optimistic forecast called for 6% price growth while the most conservative expects no price appreciation at all. No one predicted prices would drop but in Burnaby they dropped by 7-11%.

Looking forward in 2019, we see most forecasters expect prices to drop.

The brunt of 2019 price drops will likely be felt by higher priced properties (i.e., more expensive neighbourhoods and detached single family homes) as well as areas with low activity (e.g., Squamish and Port Moody).

Given the forecasts, the current market weakness, and the increased downward price pressure, prices will likely remain flat or drop for the next few months. As well, homebuyers and homeowners shouldn’t expect much price appreciation between now and the end of 2020.

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2. What are Surrey Purchase and Listing Trends?

2019 has started even slower than last year which implies we will see a buyers’ market by the end of the year. That means home buyers should drive a hard bargain and paying more than the list price should be almost unheard of.

The worst hit markets in Metro Vancouver include Richmond, the Vancouver Westside, and West Vancouver. We at Mortgage Sandbox interpret this to mean that foreign buyers and speculators are no longer placing money in the Metro Vancouver market.

Although foreign direct investment helps Canada with the construction and house price boom, investors who treat housing as a commodity bring commodity-like price volatility (e.g., gold, oil, coffee) to housing which can be very disruptive for people who believe homes should be used primarily as shelter for the people who live and work in the local community.

Surrey house purchases are consistently trending below previous years and there are a record number of Surrey houses for sale.

The Surrey condo purchases are much lower this Spring than other years while there are more condos for sale than ever before. Usually the number of purchases slow down as we approach July so there is a very small window for sellers to find buyers for their homes.

Fewer buyers – No longer a foreign investment hotspot

2019 has been a slow year for purchases of all types of properties, which is certainly not something we’re used to seeing. The City of Vancouver and more central suburbs have seen the most dramatic falls in purchase and sales. Our research suggests that foreign buyers are moving on to other cities and countries. Scanning news outlets across Canada and reviewing realtor marketing materials, it becomes clear that any foreign money still coming to Canada seems to be directed toward Toronto, Ottawa and Montreal.

The number of Surrey houses sold is trending consistently below past years while the number houses listed for sale has been trending much higher than past years. These trends of lower demand and higher supply explain a reduction in price.

Trending Toward Buyer’s Advantage

The markets for both houses and condos in Surrey are trending toward a position where buyers can negotiate discounts and incentives from sellers. This means more selection for home buyers, fewer bidding wars and less upward pressure on home prices.

The charts below show the market balance in Surrey the house market is balanced but recently trending toward a seller’s advantage.

A decrease in pre-sales reflects a more disciplined market

Pre-sales, which are purchases of brand-new homes from developers, have trended down substantially. Since developers need to sell at least 70% of a project to secure financing and begin construction, they are trying to entice buyers with price discounts, move-in allowances, and cool amenities. Some developers have offered up to a $100,000 bonus to the buyer realtor who can convince their client to buy!

According to MLA advisory, the current pre-sale activity levels “reflect a more normalized pace of sales for the Lower Mainland.”

Developer incentives can take the form of free storage lockers, parking spots, home décor store credits worth thousands, and nicer party rooms. Whatever it takes to help you decide faster, so they can begin building.

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Causes of the Slowdown

At Mortgage Sandbox, we break down our market analysis to five key factors: affordability, capital flows, government policy, supply and popular sentiment.

Five Factors Driving Home Prices

Five Factors Driving Home Prices

3. Should Investors Sell?

From a seller’s perspective, now is a better time to sell than in two years as CMHC, a Government of Canada Agency predicts that house prices will be flat or drop for the next two years.

To benefit from the best-case scenario, a home buyer should talk to their mortgage broker about prioritizing flexible loan conditions and mitigating risk. Find out more about the benefits of a mortgage broker.

Potential for a highly supplied market

There’s potential for an overwhelming surge in supply and this would bring more downward pressure on prices.

41,000 homes were under construction in Metro Vancouver in February 2019. These are due to complete in 2019 and 2020. If a significant number of those homes were pre-purchased with the intention to flip them, they could bring a ton of supply to the Burnaby market.

4. Is this a good time to buy?

With buyer negotiating power and dropping prices, 2019 will be a good time to buy a Surrey home. However, 2020 may be even better.

If you are thinking of buying just be sure to drive a hard bargain, and cover your bases with smart and educated decisions. Don’t bite off more than you can chew.

Buying a home is a big decision, so check out Mortgage Sandbox’s Canadian Home Buyer Guide so we can walk you through the end-to-end process and get you ready to buy your new home!

Where will mortgage rates be by 2021?

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