Get buyers off the bench…mark pricing…

(Recent buzz on social media made me think of this. This article was produced, 97% human, 3% Ai)

Looking at the latest statistical reports for June 2025, benchmark prices for single-family homes appear to be rising across much of the BC Interior. So why does it feel like the opposite is happening for many of us?

What’s really going on? And how do we help our buyers and sellers make sense of the market conditions—especially for the specific type of property they’re interested in?

We often face the challenge of media coverage that lags behind or focuses on national trends that don’t reflect our local realities. Clients are left asking:

• Are prices going up or down?
• Why should I reduce my price if benchmark values are increasing?
• Why should I write an offer on an overpriced listing when there’s so much inventory?

It’s a lot to take in. But yes—it is possible to make sense of this. Let’s walk through an example together.

Case Study: Newer home with pool

Let’s use the following search criteria:

• Built 2012 or later
• Under 4,001 sq. ft.
• Includes a legal suite and a pool

This is a specific property type and buyer, yet perhaps this illustration can help us see what’s really happening. You can replicate this approach for any CMA in any neighbourhood by customizing your search parameters, of course.

So… are prices up? Yes. Does this mean conditions are favourable to sellers? Not necessarily. Beware of averages…

Let’s look deeper.

Outliers and Adjustments

**In 2025, two homes sold over $2M (compared to zero in 2024).

Removing these sales changes the narrative:

Average sale price drops by 4.26%, a 10% reduction from the benchmark increase. So, if your client has less than $2 million to spend, prices are down this year.

Price per square foot increases only 3.42%—a more reasonable figure.

This suggests that prices may actually be lower for “average” homes inside a tighter budget.

This highlights the importance of refining your data and removing anomalies to get a clearer picture.

Interest Rates Are Shifting Buyer Behaviour

In 2024, a $1.25M mortgage (5-year fixed, 25-year amortization, 4.58% Int) cost around $6,974/month.

Today, with rates down approximately 7%, that same mortgage is closer to $6,745/month—a 3.3% drop in monthly payments. That’s approx $4,000 saved in interest in year one alone and $19,700 over five years. Is this the cause of the benchmark increase?

With lower rates, perhaps buyers are shifting their focus toward better-quality homes, opting for move-in-ready properties instead of renovations. Does this reflect what you are seeing?

Key Takeaways

*Don’t rely solely on benchmark price data—build your own story using relevant, local information.

*Keep your search criteria specific and your sample sizes manageable.

*Remove outliers that distort the data—especially luxury or deeply discounted sales.

*Talk to your client’s mortgage broker, find out their rate and help them understand the “real” numbers.

*Use a variety of valuation methods: price per square foot, income approach (CAP rate), suite value, bedroom count, and more.

*Calculate absorption rates before you price a home and before you write a CPS.

Final Thoughts

I don’t believe we’re seeing a surge in home values across the board.

What we’re witnessing is a shift in buyer behaviour, driven largely by buyer desires for features supported by “better” interest rates.

What are you seeing in your market?

Does this type of focused analysis help? I hope it gives you some practical tools and insight to help you offer better advice to clients.

Wishing you success out there,

Dean

Data compiled from AOIR Matrix on July 18, 2025. All data is the property of AOIR and is provided here for illustrative purposes only. Licensees are required to conduct their research and advise clients accordingly. This information is presented for illustration purposes only.

Good luck out there!

Dean