Metro Vancouver’s residential real estate market was full steam ahead in February. Sales skyrocketed to 3,727, a 73.3% increase from the 2,150 sales recorded in February 2020 and 42.8% above the 10-year February average. This type of acceleration in sales is usually saved for the spring market, which is still yet to come.
The supply of available listings isn’t keeping up with the demand for homes, despite new listings seeing a healthy increase over the number of new homes listed in January. The high level of demand caused home prices to make significant gains in the last month, with single family and townhomes selling for over list price. Condos weren’t far behind, selling at 98.8% of list price. The HPI Benchmark price for all residential property types rose between 2.5%-13.7% year-over-year, with detached homes making the biggest jump.
The demand for single family homes, and the resulting price increases, are having the predicted knock-on effect as home buyers are pushed into other home types, like townhomes and then condos, which in turn is putting upward pressure on the prices for those property types.
Low interest rates remain a key driver for the increase in demand that we are seeing in today’s market and with indications from the Bank of Canada that rates could potentially remain low into 2023, this trend will continue to help move-up buyers and first-time home buyers enter the market.
So What Does This Mean For The Development Land Market North Of The Fraser?
The sustained increase in demand for homes that started last spring has brought more life into the development land market across Metro Vancouver. Any buyers who were on the sidelines have now entered the market and neighbourhoods that were sleepier the last few months are starting to see increased buyer interest.
While we are still seeing the highest demand for single family and slab-on-grade townhouse sites with scale, the demand for condo sites has continued to increase over the last month. There is also a reappearance of investors taking advantage of relatively low land prices by tying up sites that have been on the market for a while and were not garnering interest from developers or builders.
There is still a healthy inventory of certain types of development sites North of the Fraser but we don’t expect this to last as more builders and investors return to the land market. We also predict greater hesitation from landowners towards selling as values start to rise.
If all these trends continue, we are sure to see land prices rise for all types of development sites and terms become more and more favourable for sellers.
Check out our curated summary of the Real Estate Board of Greater Vancouver’s February stats in infographics below.
Please note: areas covered by the Real Estate Board of Greater Vancouver include: Whistler, Sunshine Coast, Squamish, West Vancouver, North Vancouver, Vancouver, Burnaby, New Westminster, Richmond, Port Moody, Port Coquitlam, Coquitlam, Pitt Meadows, Maple Ridge, and South Delta.
View the Real Estate Board of Greater Vancouver’s entire stats package for February 2021 here.
This representation is based in whole or in part on data generated by the Real Estate Board of Greater Vancouver which assumes no responsibility for its accuracy.