While 2018 was another strong year for development land sales in Burquitlam, the market did take a step back from the exceptionally strong year observed in 2017. In this report we breakdown the residential development land sales in the area and highlight the rezoning and development applications that are currently in process. We have also included an update on the Oakdale Neighbourhood Plan, an area that was designated as a future planning area in the Burquitlam-Lougheed Neighbourhood Plan.
STATE OF THE MARKET IN BURQUITLAM-LOUGHEED
In 2018, there were 22 major development land transactions along the Burquitlam-Lougheed corridor, totalling approximately $368.1 million in sales volume. This was a decrease from the 31 transactions in 2017 which equated to roughly 18.7% more in dollar volume, approximately $452.4 million.
Several factors contributed to the year-over-year reduction in development land sales: rising interest rates, taxes imposed by the new provincial government and most drastically, the B20 mortgage stress test which has put a damper on consumer demand by reducing the purchasing power of prospective homeowners.
This policy-induced shock to demand has trickled down and led to many home builders being in way less of a hurry to acquire their next development site. Another contributing factor is the rapidly rising costs to construct new homes. These cost increases have largely been influenced by the lack of availability of qualified trades and to a smaller degree, an increase in the costs of building materials.
DEVELOPMENT LAND TRANSACTIONS
There were 22 notable development land transactions in the Burquitlam market throughout 2018. Below we have summarized them by land use designation.
The red and yellow highlighted regions on the below map indicate areas containing a high concentration of new development applications. It’s not surprising to see applications continue to be concentrated along the transit corridor, where the land use designations allow for the highest density forms of development, but we are starting to see development spread from the core areas. In the highlighted regions there will be an estimated 10,199 new homes built, the majority of which will be low or high rise apartments.
The land use update for Oakdale progressed closer to becoming a reality in 2018, however City staff have indicated that there are still several questions that need to be answered before the new land use plan is adopted.
City staff have prepared several land use concepts of varying densities for the neighbourhood and are pushing to have these options presented to Coquitlam Council, as well as homeowners in the neighbourhood, by the end of the year. However, one of the major hurdles that staff have indicated is holding up progress is the acquisition of land for a new park. The possibility of higher density land uses are driving land values up, beyond the affordability range of land for a park.
In addition to this, there still exists a lack of consensus over what the neighbourhood should look like in the future, with many owners in the area split on what constitutes acceptable density in Oakdale. Our conversations with owners in the area have indicated a preference for higher density options closer to the intersection of Como Lake Avenue and Clarke Road with minimal changes in the existing single family home designations further north in the neighbourhood, closer to the border with Port Moody. One of the major reasons for the Oakdale area being left out of the Burquitlam-Lougheed Neighbourhood Plan in the first place was this apparent lack of consensus among residents, and this could still be affecting the City’s timeline for updating the plan today.
While an increase to high density would likely have the greatest effect on land values in the area, City Staff indicate the City is likely to take a more balanced approach to their land use designation update in Oakdale as they strive to create a highly livable community with a variety of land use designations that will ultimately result in a wide range of housing choices for people looking to call Burquitlam home.
If you have any questions about residential development in Burquitlam-Lougheed (and other areas of Coquitlam), or if there is any further information that would be helpful to you, don’t hesitate to contact Adam Lawrence.
In creating this report, we consult City of Coquitlam planning staff, survey multiple land transaction reporting systems, analyze municipal development data and seek the insight of community residents and many developers to bring you the most relevant information.
Sources: MLS, Commercial Edge, City of Coquitlam, Urban Analytics New Home Source