September 4, 2015
Clear skies ahead for Metro Vancouver’s housing market
Sales have been brisk for condos and houses in the first half of 2015, and there is no slowdown in sight
By Michael Bernard
The summer of 2015 was a weird reversal of the typical Vancouver summer.
For weeks on end, Vancouverites woke up to blue-sky days. They also woke up to almost daily stories about multiple offers and houses selling for thousands above their asking prices in Vancouver’s seemingly boundless real-estate market. “The weather has been awfully hot and the market has been awfully hot too,” says Scott Brown, president of Fifth Avenue Real Estate Marketing, one of Vancouver’s largest marketers of condos, which account for 70 per cent of all housing sales.
He expects Metro Vancouver sales to match or come close to last year’s total of 13,000 units, but he says this year is a little different than 2014. It lacks the launch of any high-profile downtown projects, such as the 388-unit Vancouver House which rapidly sold out. The over-all high volume of sales actually reflects steady demand across all markets in the region, he said.
On top of continuing low interest rates and strong in-migration, Brown also attributes demand to the aging population. Downsizers trigger at least four or five more real-estate transactions, including first-time buyers getting help from the Bank of Mom and Pop which is now flush with cash from single-family home sales.
Local markets to watch for sales this year? Brown says look for strong demand for one-bedroom suites in the downtown area, homes with the master bedroom on the main floor in Langley, ultra-luxury condos in White Rock and South Surrey, and increasing demand for units in Maple Ridge as families move east looking for space. Also look out for higher sales in lower Lynn Valley and continued high demand for housing along Vancouver’s Cambie corridor.
At Sotheby International, vice-president and managing broker Greg Carros says his company has had an exceptionally strong first six months of 2015. “I don’t see that slowing down at all,” he says. “There is lots of pent-up demand, interest rates are favourable and people are very confident about their purchase decisions.”
Carros says there is stronger demand this year over 2014 for one-bedroom downtown units, which are attracting multiple offers. As for suburban markets, he said the most recent mortgage-rate cut has allowed first-time buyers to go for another $10,000 to $15,000 in house value. Polygon president Neil Chrystal says his company is on route to posting its best year for starts since the company began in 1980.
“The market has been really strong and it comes down to a couple of things,” he said. “Low interest rates continue to make housing affordable, particularly for first-time buyers. And Vancouver continues to be seen as a very attractive place to live.” He says recent turmoil in the Chinese stock markets could have two effects on Vancouver’s market: Chinese buyers could have less money to buy Vancouver real estate, or they could see it an opportunity to diversify into a less volatile investment.