STATE OF THE MARKET IN SOUTH SURREY
Amidst a backdrop of market corrections affecting real estate nationwide, South Surrey has not been exempt from this trend. After a remarkable two-year high during the pandemic, the housing market in South Surrey is currently in a phase of gradual adjustment. With seven interest rate hikes in 2022, followed by an additional three in 2023, pushing the rate to 5%, the challenges in the South Surrey real estate landscape have intensified. Nevertheless, despite the elevated borrowing costs and broader market adjustments, discussions with local developers continue to highlight the resilience and attractiveness of South Surrey’s housing market.
Looking at the transaction data, there is an increase in transaction volume in 2022 compared to 2021, likely reflecting deals negotiated in the preceding year. However, the notable highlight is the sharp decline in the first six months of 2023, with a significant drop of approximately 61% compared to the same period in 2022. This decline is largely attributed to recent interest rate hikes, municipal fee increases, and rising construction costs, which have impacted the affordability and financing dynamics of development land.
DEVELOPMENT APPLICATIONS IN SOUTH SURREY
In South Surrey, there are two prominent zones where the majority of ongoing development proposals are concentrated. Sunnyside Heights and Dart’s Hill collectively envision the addition of approximately 3,000 new residences spread over 180 acres. These areas lead development in South Surrey in upcoming residential projects. While the figures below suggest a substantial influx of new housing units into the market, it is crucial to emphasize that these applications are in varying stages of the planning process and will not be introduced to the market simultaneously. While a few of these proposals may materialize within the current year, a portion will require a timeline of two years or more for full implementation.
23 significant* applications
1,578 units proposed over 78+ acres
131 Single Family Homes
15 significant* applications
1,416 units proposed over 101 acres
100 Single Family Homes
* A “significant” application is any application with greater than 5 units or lots
Impact On The Road Ahead
The land market in South Surrey is currently at a standstill, evident through the low volume of transactions. This pause is largely due to landowners’ pricing expectations not aligning with developers bids, which are affected by rising municipal fees, and high interest rates. Notably, the 14 transactions in premium locations this year saw an average price per acre** fall by 0.4 percent, a deviation from the usual upward trend in such locations. For the market to move forward, landowners will need to adjust their expectations in light of the increased costs of building. Such a realignment, together with a potential leveling off of municipal expenses and interest rates, could kick-start market activity and improve the outlook for development land.
Below you will find a summary of the distinguishing features of each neighbourhood as laid out in the draft plan, as well as an update on the current status of each neighbourhood.
How We Value Land
Each site is unique. Click here or call us to request a free, no commitment valuation of your property.
In creating this report, we survey multiple land transaction reporting systems (Commercial Edge, MLS), analyze municipal development data, and consult the Township of Langley planning staff as well as key stakeholders to bring you the most relevant information. If you have any questions about this report or the local development land market, don’t hesitate to reach out.
To receive future reports directly to your inbox, please sign up for our development land newsletter here.