The momentum observed in the Greater Vancouver real estate market over the summer has continued into the fall, with the Real Estate Board of Greater Vancouver reporting record-breaking sales for the month of September.
While much of the media’s focus regarding recent sales numbers has been on “pent up demand” post lockdown, it seems as though there is more depth to the current buyer pool than just that. Buyers are certainly capitalizing on historically low interest rates and we are seeing demand for homes increase across all product types. Year to date, sales volumes for all product types have increased considerably over 2019 and this is despite the “lost” selling time from mid-March thru mid-May.
New listing activity has also been strong compared to previous years but, as demand has more than kept pace, the sales to active listings ratios for all product types have increased and are well rooted in what is considered a seller’s market.
The record-breaking sales activity is definitely not a result of “COVID deals”, quite the opposite. Year to date, prices have increased across all home types in Greater Vancouver. Single family pricing has increased more than multi-family pricing at +5.8%. Townhomes and condos have increased 4.0%. This is representative of a larger trend in demand for more space in suburban areas. Coquitlam, for example, has experienced stronger price growth for single family and townhomes than Greater Vancouver as a whole, but price growth is still lagging for condos.
So What Does This Mean For The Development Land Market North Of The Fraser?
Market conditions are becoming more favourable for vendors of certain types of development land in our core markets North of the Fraser. While the consecutive months of strong sales data from the Real Estate Board has helped build confidence, this is still a different market than we’ve been operating in over the last few years.
Sites that facilitate the development of homes that are typically purchased by owner-occupiers, like single family, townhome, and wood frame condo, are receiving the bulk of developer attention right now. What is more, slab on grade townhome sites are considered more desirable than stacked townhouse sites due to the additional complexity, cost, and risk of developing the latter. Despite the availability of well-located stacked townhouse sites in places like Burquitlam, developers are opting to forgo these opportunities in the hopes of finding a slab on grade or wood frame apartment site to build-out instead.
Demand for high-rise condo sites, on the other hand, remains low. This is mostly due to the perceived risk of not being able to hit presale targets within the prescribed REDMA time period due to a lack of investors currently operating in the market. Several prominent developers are set to launch sales for their high-rise condo projects in the coming weeks and how those projects perform will play a large part in driving developer demand for transit-oriented high-rise sites going forward.
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 September 2020 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.