Overall Market Insights

After two initial key interest rate decreases at the beginning of the year and then holding the rate for the subsequent three announcements, the Bank of Canada lowered the target for the overnight rate this past Wednesday by 25 basis points to 2.5%.

The cut in March of 2024 was the beginning of seven consecutive rate cuts, signaling an easing cycle after more than a year of elevated borrowing costs before it held rates for the following 3 announcements. This latest cut is in response to weaker economic growth, fewer exports, and rising unemployment, while inflation pressures have started to ease.

The Bank said lowering rates should help support the slowing economy while keeping inflation moving toward its target, and most experts are anticipating another 0.25% decrease on October 29th.

While today’s rates remain higher than the ultra-low levels seen during the pandemic, they are now approaching the Bank’s traditional long-term norms.

Against this backdrop, the Eastern Fraser Valley is showing a more balanced picture. In Abbotsford, Chilliwack, Langley, and Mission, buyers continue to have more choice, with months of inventory ranging from balanced to buyer-leaning. Detached homes remain relatively resilient, while townhomes and condos are displaying more price sensitivity.

Fraser Valley buyers have a rare overlap of lowering interest rates, softer prices, balanced inventory, and less competition—a combination that doesn’t come around often.

What does this mean for you?

First-Time Buyers

This is an excellent moment for first-time buyers who have steady employment and a solid down payment. Prices are sitting near their lowest levels, while interest rates are easing — a rare combination that creates real opportunity.

Condos and townhomes are especially appealing, with many priced more competitively than renting. This is true even for Langley and Abbotsford giving entry-level buyers more options than they’ve seen in years.

Investors

For investors, the three key drivers — repayment, cash flow, and appreciation — are aligning once again. With the market near its bottom, the upside for appreciation looks stronger than it has in years.

Lower interest rates are easing repayment and improving cash flow, which strengthens long-term returns. Experienced investors are already stepping back in, while many casual buyers have yet to catch up — creating an advantage for those who move early.

Downsizing

While downsizing conditions are not yet ideal, they are much better than before. The higher-end segment of the market is still moving slowly, but properties with acreage had a stronger summer.

At the same time, entry-level homes remain the most active, with prices holding fairly steady. Detached homes are showing more resilience compared to townhomes and condos, which makes conditions less challenging for those considering a transition.

Upsizing

For buyers looking to move up, this is still an opportune time. Prices at the higher end remain more affordable than in recent years, and lower rates are starting to ease the pressure of monthly payments.

This window may not last long, as activity in the upper segments of the market is beginning to pick up. Those who act sooner are more likely to benefit from both lower prices and improved financing conditions before upward pressure returns.