The Fifth Dimension Spring Edition 2023

THE FIFTH DIMENSION

SPRING EDITION 2023

A Comprehensive Analysis of the Metro Vancouver Multi-family Market

Provided Collaboratively By:

WELCOME TO THE FIFTH DIMENSION

In the last quarter, we observed that undersupplied neighbourhoods had better sales compared to oversupplied ones. The oversupplied neighbourhoods had a slower with higher constraints on prices due to the competitiveness of these neighbourhoods. Additionally, we discussed the recent Bank of Canada interest rate increase and indications that they may maintain rates in the first quarter of 2023.

This report is produced collaboratively by Fifth Avenue Real Estate Marketing Limited, a leading full service, suburban market-focused residential real estate sales and development marketing organization and our Central Vancouver based organization, BakerWest Real Estate Incorporated. BakerWest and Fifth Avenue are part of the Peerage Realty Partners network whose other BC interest include Sotheby’s International Canada and Okanagan-based Epic Real Estate Solutions Inc. We also enjoy strategic Vancouver Island Partnership with DFH Real Estate and Island Realm Real Estate. Together we cover British Columbia’s ever changing and expanding new home market.

The supporting data for this report is objectively collected and presented by renowned and renamed Zonda Urban (formerly Urban Analytics), a leading provider of advisory services on the new Multifamily home market and a vital contributor to this report since 2010.

Spring 2023 came in like a lion and left like a lamb as we jump from wet and cold weather to a hot and sunny 27 degrees Celsius. The rejuvenating aura of this time of year, adorned with blooming flowers and the redolence of freshly cut grass, fills us with renewed optimism for the burgeoning new home real estate markets in Metro Vancouver and Fraser Valley.

Within this evolving landscape, four areas have emerged as beacons of progress, showcasing remarkable improvements in the overall real estate market. Among them, Vancouver’s North Shore stands out, undergoing a remarkable transformation from a red light to a vibrant green light. This significant shift can be attributed to a remarkable 91% surge in sales absorptions during the first quarter of 2023 compared

to the previous quarter, coupled with the introduction of new highrise developments that have expanded the available supply. While these two launches contributed to 70% of the first-quarter sales, it is noteworthy that absorption rates across all home product sectors, including townhomes and low-rise properties, have experienced substantial quarter-over-quarter growth.

Another noteworthy area that has experienced a remarkable turnaround is South Surrey/White Rock. This locale, transitioning from a cautious yellow light, now radiates a resplendent green light, symbolizing its resurgence. The surge in sales activity, surpassing threefold that of the previous quarter, can be attributed to a surge in townhome activity and a limited influx of new developments entering the market. Consequently, this has led to a scarcity of available condominiums in both the high and low-rise segments, underscoring the desirability and demand in this vibrant neighborhood.

These positive developments serve as a resounding testament to the indomitable spirit of the real estate market, showcasing its remarkable ability to adapt, thrive, and overcome challenges. By seizing growth opportunities, fostering community engagement, and capitalizing on the dynamic nature of the market, we empower ourselves to embrace a future brimming with infinite possibilities. Together, we forge a path towards prosperity, where aspirations find their rightful place in the vibrant tapestry of our communities.

The latest statistics from the first quarter bolster our previous discussions, underscoring the crucial interplay between supply and demand in specific neighborhoods. While certain areas may bear a cautionary red or yellow light rating, it is imperative to recognize that there are neighborhoods that warrant a resolute green light. This emphasizes the paramount importance of comprehending distinct market areas and demographics before embarking on any development endeavor. By conducting thorough research and analysis, we position ourselves to make informed decisions that contribute to the overall growth and vibrancy of our real estate landscape. As mentioned in our previous

Fifth Dimension report, the Bank of Canada (BOC) has maintained the rate at 4.50% since January, which has contributed to the increased market activity observed in the first quarter. Currently, there are two prevailing views regarding the future direction of interest rates. One view is that the BOC will maintain this rate pause until the end of 2023, with rates potentially going down in 2024. The other view is that rates may increase at least once more in 2023 before potentially starting to decrease again in 2024.

The rate of inflation, which is currently at 5.2%, much higher than the BOC’s desired 2%, will likely determine which view holds true. If the BOC holds or lowers the overnight rates, it will boost consumer confidence in the market. However, further rate increases could reduce the absorption rate gains seen in this quarter, as they will increase borrowing costs and limit potential buyers’ purchasing power. We will need to closely monitor inflation in the upcoming months and how the Bank of Canada responds to it. The BOC is scheduled to make its next rate announcement on June 7th, followed by another on July 12th. Be ready to celebrate or wallow away as these two announcements will set the tone for the summer Q3 market.

Regards, and all the best.

Jamie Squires

Jamie Squires President & Managing Broker Fifth Avenue Real Estate Marketing LTD. jamie@fifthave.ca

OVERALL MARKET SUMMARY

In this highly anticipated First edition of the Fifth Dimension for 2023, we are thrilled to present the invaluable insights provided by our esteemed data collection and analysis partner, Zonda Urban. Their expertise and comprehensive analysis offer a compelling commentary on the recent quarter’s performance, a comprehensive overview of the market’s year-to-date achievements, and a tantalizing glimpse into what lies ahead for Metro Vancouver’s thriving multi-family residential real estate market.

Q1 — New Home Market

Metro Vancouver’s new home market showed signs of recovery in the First Quarter of 2023 after experiencing near-record low sales throughout the second half of 2022. Although buyer activity in certain segments of the market is indicative of positive momentum, many developers have still delayed their respective project launches to wait for improved economic and/or purchaser sentiment.

Only 12 new projects were launched over the quarter releasing 1,415 units into the market. Total inventory released in the First Quarter of 2023 was significantly lower than previous first quarters. The 2,141 total new home sales recorded during the First Quarter of the year marks the lowest First Quarter total since 2013.

On a positive note, overall First Quarter sales were six percent higher than the previous quarter. There were 7,462 released and unsold units remaining at the end of the First Quarter, a nine percent decrease from the previous quarter but a 45 percent increase from the same quarter last year. 973 completed unsold new multi-family homes were available at the end of the First Quarter, up three units from the previous quarter and up 96 percent from the previous year.

A total of 1,286 High Rise sales were recorded in the First Quarter of 2023, a 54 percent increase from the previous quarter but 69 percent fewer than the same quarter last year. High Rise sales accounted for 60 percent of new home sales during the quarter.

There were 5,249 released and unsold High Rise units available at the end of the First Quarter, a five percent decrease from the previous quarter but a 34 percent increase year-over-year.

The majority of High Rise sales occurred in the Burnaby/New Westminster sub-market, which accounted for 44 percent of all High Rise sales during the quarter. Combined High Rise sales in the Burnaby/New Westminster, Central Surrey/North Delta, and Tri-Cities sub-markets accounted for 85 percent of sales in this sector, and 51 percent of all new multi-family home sales during the quarter. Notable sales activity occurred at Anthem’s first tower of South Yards (Brentwood), Lucent by Landa Group (City Centre), Perla by Polygon (Metrotown), Marcon’s Elmwood (Burquitlam), Band by Townline (Burquitlam), and Concord’s Oasis (Brentwood)

The 535 new Low Rise condominium sales recorded in the First Quarter of 2023 were 43 percent lower than the previous quarter and 66 percent fewer than the number sold in the same quarter last year. The decrease in sales when compared to the previous quarter can be explained by a lack of project launches to the market; only three new Low Rise projects were launched during the quarter which added 251 units to the market.

This compares to the 10 new project launches which released 1,049 units in the previous quarter. The 1,213 released and unsold units at the end of the First Quarter represents a four percent decrease from the previous quarter. The Tri-Cities and Central Surrey/North Delta sub-markets experienced the highest number of new Low Rise multi-family home sales in Metro Vancouver as they accounted for a combined total of 286 unit sales.

Notable sales activity across Metro Vancouver’s Low Rise condominium sector was noted at Whitetail Homes’ Galilea (City Centre), the second building of Highstreet Village by AB Wall (Abbotsford), Marcon’s Hue (St. Johns), Florin by Allaire/Circadian

Group (Burquitlam), and Lennox by Polygon (Central Lonsdale).

A total of 320 new Townhome sales were recorded in the First Quarter of 2023, which represents a 29 percent increase from the previous quarter but a 51 percent year-over-year decline. There were 1,000 released and unsold Townhome units at the end of the First Quarter, which is eight percent higher than the previous quarter and 100 percent higher than the same quarter last year.

The available Townhome inventory continues to rise as sales activity for this product remains low. There were only five new townhome projects launched during the quarter which released 113 units into the market. Sales activity was observed at The Loop by Gramercy Developments (Grandview Heights), Garcha’s Union Willoughby (Yorkson), Oakley by Warwickshire Homes (Willoughby Heights), Westhampton at Hampton Cove by Polygon (Ladner), AB Wall’s Highstreet Village (Abbotsford), and Heath by BM Group (Yorkson).

Q1 — Resale Market

Taking a closer look at the various product sectors, we observe an encouraging upward trend. High Rise, Low Rise, and Townhome resales experienced impressive growth rates of 58, 22, and 43 percent respectively, compared to the previous quarter. Although these figures show a decline compared to the same quarter last year, with decreases of 49, 52, and 50 percent for High Rise, Low Rise, and Townhome sectors respectively, it is vital to consider the broader market context and evolving consumer preferences.

The availability of active listings also witnessed a positive surge, highlighting an increased supply of options for prospective buyers. Overall, active listings rose by an impressive 34 percent compared to the previous quarter and 35 percent relative to the same quarter last year. This trend extends to the High Rise, Low Rise, and Townhome segments, with notable increases of 38, 41, and 20 percent respectively, compared to the Fourth Quarter of 2022.

OVERALL MARKET SUMMARY

These statistics not only showcase the diversity of choices available to buyers but also affirm the industry’s commitment to meeting evolving market demands. As active listings continue to expand, opportunities for buyers and investors grow, setting the stage for a dynamic and thriving marketplace.

In the face of evolving challenges and changing market dynamics, Metro Vancouver’s multi-family residential real estate market remains steadfast and poised for success. By embracing the opportunities presented by increased listings and leveraging our collective expertise, we are empowered to forge ahead with confidence and unlock the boundless potential that lies ahead.

Q1 – Observation and Opinions

The landscape of the real estate market in Metro Vancouver is undergoing a significant transformation, influenced by various factors that shape the industry’s dynamics. As we delve into the latest developments, it is evident that opportunities for growth and progress lie ahead.

At the forefront of this analysis is the decision of the Bank of Canada to maintain the overnight lending rate at 450 basis points. This noteworthy development marks a shift from the previous trend of consistent rate increases, instilling a sense of optimism and potential for lower interest rates in the future. It is important to note that the Bank of Canada remains committed to its quantitative tightening policy, should it be deemed necessary to maintain stability and control.

While the pause in overnight rate increases fosters a positive outlook, it is essential to acknowledge the broader context of borrowing costs. Overall, borrowing costs remain at or near all-time highs, contributing to a decrease in purchasing activity. However,

the landscape is not without its silver linings. Positive migration patterns have resulted in increased rental demand, leading to record-high rental rates. This dynamic signals a resilient and thriving rental market that presents its own set of opportunities for investors and developers. Looking ahead, there is a growing sense of optimism regarding the buying activity in Metro Vancouver for the latter half of the year.

Successful launches in the First Quarter have laid the foundation for this renewed confidence, and it is anticipated that additional launches in the Second Quarter of 2023 will further bolster developer confidence, prompting them to move forward with their respective projects. Notable projects that could launch in the First or Second Quarter of 2023 include: Vancouver Downtown – Brivia Group’s CURV, Anthem’s Park; Vancouver West - Solterra’s Italia, Alabaster’s Thesis, Polygon’s Wordsworth; Vancouver East - First Track Development’s Woodland Block, Streetside Developments’ Bailey; Burnaby - Anthem’s Citizen, Aragon’s Timber House, Kingborn’s Koi; North Shore - Mosaic’s Towns at Lynn, Anthem’s Eastwoods; Tri-Cities - Edgar Developments’ Portwood, Intracorp’s Gardena, Kadium Properties Burqville; Richmond/South Delta – Executive Group Development’s West Coast Estates (Condos), Aquilini’s Salt and Meadows 3; South Surrey/White Rock - Landmark Premiere Properties Foster Martin (Tower 3); Central Surrey/North Delta - ML Emporio’s Sequoia, Dawson + Sawyer Fleetwood Village Buildilng 4&5, Streetside Developments’ Juno; Langley/Cloverdale – Park Ridge Homes’ Kinship, Quarry Rock Developments’ The Willoughby, Mortise’s Unison; Abbotsford/Mission - Pacific Hills Development’s Westminster Plateau, AB Wall’s Highstreet Village Phase 3, Westcorp’s Cherryville; Ridge-Meadows - Pacific Vision Development’s La Riviere, Falcon Homes’ The North.

Resale Market Totals Q1-2023

MARKET SUMMARY

VANCOUVER DOWNTOWN

In the First Quarter of 2023, the Vancouver Downtown market will be given a ‘Yellow Light’ status. A total of 17 sales were recorded during this period, indicating a slight increase of five sales from the previous quarter. The majority of the sales were attributed to finished move-in-ready properties, which provided realtor promotions, GST promotions, and credits up to five percent of the purchase price. Notably, a single project contributed to ten of the 17 recorded sales. Finished move-in-ready homes constituted 31 percent of the total unsold inventory in the area, with one project accounting for 71 percent of such properties. The upcoming launches of new luxury projects in the next quarter are highly anticipated. The reception of the comparatively high-end products, priced between $2,500 - $2,800 per square foot, will be instrumental in determining the market sentiment towards luxury properties.

New Market Highlights

Marcon has commenced sales of a new 19-unit development called 2030 Barclay, located south of Stanley Park; pricing ranges from $3.5 million to $5.6 million, with unit sizes ranging from 1600 to 2300 square feet.

After an extended pause on sales efforts, Landmark on Robson by Asia Pacific Standards has released limited inventory at approximately $2,600 per square foot (net). They are also offering major promotions such as no mortgage payment for 5 years and a 5 percent commission for the realtor community for a limited number of homes sold.

The Pacific by Grosvenor has recorded 10 sales over the quarter, with just 9 units remaining. They are offering large credit offerings of up to 5 percent and an increased limited commission of 5 percent.

Brivia Group’s new 60-storey passive house high-rise condominium, Curv, started previews in late March and is anticipated to be priced at $2500 to $2600 per square foot.

**Note: The greater variation in active Sales Price Range is the result of the achievable sale value differential between comparable product in the different Downtown neighbourhoods.

VANCOUVER DOWNTOWN RESALE MARKET SUMMARY

MLS Resale Highlights

Average sales values per square foot have decreased by $219 when compared with the First Quarter of 2022 for High Rise product

The number of High Rise listings has increased from 176 to 248, while High Rise resales decreased by 96 when compared to the First Quarter of 2022

The average per square foot values of one and two bedroom High Rise condominiums decreased by $126 and $6, respectively, since the First Quarter of 2022

The months of supply for resales in the High Rise market has increased from 3.7 months to 14.0 months when comparing to the same quarter last year

The sales range has decreased by $35,000 on the lower end and decreased by $756,667 on the higher-end over the past four quarters for High Rise product

The average time a unit is on the market has increased for High Rise by 13 days since the First Quarter of 2022

Resale Statistics (Product 10 Years of Age or Less)

MLS Resale by Unit Type

VANCOUVER WEST

For the First Quarter of 2023, Vancouver West will remain classified as a “Yellow Light” submarket. The submarket experienced a 37 percent increase in sales compared to the previous quarter, recording 114 sales. The sales were largely driven by Lunar New Year promotions at the beginning of the year, but sales slowed down for the rest of the quarter. New inventory continues to be limited in this submarket as there was one new project launch released 12 units. The project had the highest blended price for townhomes and achieved a 42 percent absorption rate, indicating that activity is still active in the area. Many developments remain on hold as they finish construction or await better market conditions. The High Rise sector accounted for 76 percent of total sales, contributing the most to sales activity in the Vancouver West market. With interest rates remaining stable, there is an expectation that new project launches will occur, leading to increased sales activity.

New Market Highlights

SOTO on W28, a 20-unit townhome project by Forme Properties Inc. released 12 units in mid-March and achieved five sales at an overall blended price of $1,740 per square foot

The remaining Oakridge Towers (Tower 4, 6, and 7) developed by Westbank and Quadreal achieved 53 sales over the First Quarter of 2023. The developer offered a Lunar New Year promotion of up to $88,888 off and a reduced deposit structure of 16 percent

Aria Pacific Development’s Savoy at Queen Elizabeth Park is 90 percent sold as it achieved 14 sales over the quarter. Completion is targeted for the end of April and the incentives that was offered includes a four percent realtor commission and up to $200,000 in credit

The first two towers of Cambie Gardens by Onni have completed construction and there are 82 movein ready homes

Listraor’s Townhome project, Boden achieved six sales over the First Quarter of 2023 at blended price of $1,294 with construction expected to complete in late Spring 2023

VANCOUVER WEST RESALE MARKET SUMMARY

MLS Resale Highlights

Total listings have increased by 10 while total resales have decreased by 222 when compared to the First Quarter of 2022

The average time a unit is on the market has increased for High Rise, Low Rise, and Townhomes by 18, 10, and 17 days, respectively, since the First Quarter of 2022

Average price per square foot sales values for High Rise and Low Rise units have decreased over the past four quarters by $44 and $30, respectively, while Townhomes increased by $14

Two bedroom High Rise and Low Rise product saw decreases of $67 and $10, respectively, in average price per square foot sales values when compared to four quarters ago

The sales range has decreased by $42,000 on the lower end and increased by $54,000 on the higher end since the First Quarter of 2022 for High Rise product

The Townhomes sales range has decreased by $195,700 on the lower end and by $50,000 on the higher-end over the past four quarters

MLS Resale Statistics (Product 10 Years of Age or Less)

MLS Resale by Unit Type

VANCOUVER EAST

The Vancouver East submarket has been given a ‘Yellow Light’ status due to its sales performance in the First Quarter of 2023. The area witnessed a significant increase of 50 percent in total sales, reaching a count of 21 total sales. Despite the limited availability of new inventory, sales activity picked up, due to various incentives. The High Rise sector dominated the market with 52 percent of all sales, while the Low Rise and Townhome sector each held 24 percent of sales. These positive market conditions have encouraged developers to showcase new projects, with some expected to be released in the Second Quarter of 2023. This preview of upcoming developments has sparked optimism in the market, signaling a possible surge in sales activity and a potential upgrade of the market status in the coming quarters.

Market Highlights

Bucci released 2550 Garden Drive in early October 2022, a near completed 69-unit Low Rise development that achieved 15 sales to date

Wesgroup’s Avalon 3 concrete condominium development sold all remaining units throughout the First Quarter of 2023

Georgia Pacific Holdings Corp. is expected to release Gemini Mount Pleasant (previously called Grand and owned by Green Oak Development) in the Second Quarter of 2023, a near-completed 18unit concrete Condominium at an overall blended price of $1,429 per square foot

Block 1910, an 8-unit townhome project by Hudson Projects sold its remaining 3 units over the First Quarter of 2023

Chard Development is expected to release a 131-unit Low Rise project called Earl this upcoming quarter

VANCOUVER EAST RESALE MARKET SUMMARY

MLS Resale Highlights

The average time a unit is on the market has increased for High Rise, Low Rise, and Townhomes by 25, 25, and 23 days, respectively, since the First Quarter of 2022

Average price per square foot sales values for High Rise, Low Rise, and Townhome units have decreased by $77, $39, and $54, respectively, when compared to the First Quarter of 2022

The months of supply for resales in the Low Rise market has increased from 1.2 months to 5.0 months when compared to the same quarter last year

The average price per square foot in a Low Rise for a one bedroom is up $14 while it is down by $65 for a two bedroom unit since the First Quarter of 2022

Total resales have decreased by 174 when compared to the First Quarter of 2022, while total listings have increased by 43 in that same time span

The average price per square foot for a two bedroom and three bedroom Townhome has decreased by $100 and $25, respectively, since the First Quarter of 2022

MLS Resale Statistics (Product 10 Years of Age or Less)

MLS Resale by Unit Type

RICHMOND/SOUTH DELTA

The Richmond/South Delta will maintain its “Yellow Light” status for the First Quarter of 2023. Overall activity continues to take a downward slope with a 10 percent decrease in sales compared to the previous quarter. The High-Rise sector showed strong activity with a 23 percent increase in sales over the quarter, While the Low-Rise sector stayed the same and the Townhome sector saw a 39 percent decrease in sales. The lack of sales outside of the High-Rise sector reflect the lack of inventory of Low Rise and Townhomes in this sub-market. Many developers in this submarket plan to hold many of their unit counts until construction completion as market conditions remain slow. Lunar New Year incentives created buzz in this marketplace and increased investor interest to get back in the market. Industry professionals expect market activity to increase in the latter half of 2023 as economic conditions become clearer.

Market Highlights

Ocean Row, a 38 unit townhome project by Aquilini Development launched in late March with two sales at an overall blended price of $785 per square foot

Westhampton at Hampton Cove, a 65-unit townhome development by Polygon recorded strong sales with 18 new sales over the First Quarter of 2023

The Boardwalk – Salt & Meadows 2, an Aquilini Development project achieved the only wood frame sales in the First Quarter of 2023.

Executive Group Developments is anticipated to release West Coast Estates Condos in mid-April, with phase one consisting of 84 wood frame units

**Note: The greater variation in Active Sales Price Range is the result of the achievable sale value differential between comparable product in Richmond and South Delta

RICHMOND/SOUTH DELTA RESALE MARKET SUMMARY

MLS Resale Highlights

Total resales have decreased from 439 to 243 when comparing to the First Quarter of 2022

The High Rise sales range has decreased by $8,000 on the lower end while the higher-end increased by $10,000 when comparing to the same quarter in 2022

The sales range of Townhomes decreased by $65,000 on the lower end and decreased by $86,200 on the higher-end when compared to the First Quarter of 2022

Average per square foot sales values of High Rise units and Townhomes decreased by $5 and $101, respectively, while Low Rise units increased by $28 when compared to four quarters ago

Price per square foot sales values for one bedroom High Rise and Low Rise units have decreased by $109 and $31, respectively, over the past four quarters

The average sales price of a two bedroom Townhome decreased by $133,890 while a two bedroom Townhome increased by $114,800 since the First Quarter of 2022

MLS Resale Statistics (Product 10 Years of Age or Less)

MLS Resale by Unit Type

BURNABY/NEW WESTMINSTER

The Burnaby/New Westminster submarket has maintained its “Green Light” status for the First Quarter of 2023, with 577 sales recorded, representing a 34 percent increase from the previous quarter. Two new projects were launched, and of the 698 High Rise units released, 58 percent have been absorbed. These new launches were responsible for 70 percent of the sales made during the quarter, highlighting the demand for new products in the submarket. The High Rise sector received the most interest from buyers, as sales increased by 117 percent compared to the previous quarter. In the beginning of the year, Lunar New Year promotions were introduced in several projects, which allowed developers to move some products, but new projects with lower entry price points continue to generate more activity. The success of these new projects has raised expectations for previously delayed launches to match their success and to launch in the upcoming quarter.

Market Highlights

Anthem’s first tower of the South Yards masterplan, a 363-unit High Rise launched in early January and achieved 297 sales at an overall blended price of $1,260 per square foot using their One-Price Program

Polygon released their Metrotown tower, Perla, a 335-unit High Rise in mid-March and achieved 108 sales at an average price of $1,245 per square foot

O2, Keltic Development’s High Rise achieved 49 sales over the quarter. The project offered Lunar New Year Promotions of up to $18,800 off the purchase price and a $50,000 prize draw

Intergulf’s Townhome and Low Rise development, Arbour, is 60 percent sold as it achieved 46 sales in the First Quarter of 2023

Thind’s High Rise, Eclipse, that is part of the Lumina masterplan reported 33 sales in the new year offering credit of up to $100,000 and a reduced deposit structure

BURNABY/NEW WESTMINSTER RESALE MARKET SUMMARY

MLS Resale Highlights

Total resales have decreased by 241 when compared to the First Quarter of 2022, while total listings have increased by 139 in that same time span

The average per square foot sales values of High Rise and Low Rise units decreased by $10 and $23, respectively, while Townhomes have increased by $11 when compared to the First Quarter of 2022

The sales range of High Rise product decreased by $65,000 on the lower end and the top-end price range decreased by $61,000 when compared to the First Quarter of 2022

Compared to the First Quarter of 2022, the average price per square foot of one bedroom High Rise and Low Rise product has increased by $90 and $82, respectively

The average price per square foot of two bedroom High Rise and Low Rise products has increased by $67 and $56, respectively, over the past year

The average sales price of a two bedroom Townhome has increased by $16,190 while a three bedroom Townhome decreased by $21,371 when compared to the First Quarter of 2022

MLS Resale Statistics (Product 10 Years of Age or Less)

MLS Resale by Unit Type

NEW MARKET SUMMARY

NORTH SHORE

The North Shore submarket will be upgraded to “Green Light” status for the First Quarter of 2023, having recorded 82 sales - a 91 percent increase compared to the Fourth Quarter of 2022, with sales nearly doubling from 43 to 82. The significant sales increase can be attributed to the launch of a new Low Rise project which recorded 35 sales out of 64 units released, representing 43 percent of total sales in the submarket. Despite being the most expensive Low Rise project in the area and without incentives, the project saw sales success, highlighting the demand for new products in the area. The absorption rates for High Rise, Low Rise, and Townhomes have increased to 10, 45, and 17 percent, respectively. To counteract diminished sales activity for projects that have been on the market for some time, incentives such as GST credit, reduced deposit structures, and assistance with lower mortgage payments have been offered.

Market Highlights

Lennox, a 64-unit Low Rise in North Vancouver by Polygon released in mid-March and achieved 35 sales at an average price of $1,260 per square feet

Yew and Seymour, the first release of Anthem’s North Vancouver masterplan, Baden Park, achieved seven sales over the First Quarter of 2023 before pausing sales to start construction

The West building of Seymour Village – Lupine Walk by Aquilini Development recorded eight sales and is blending at an average price of $992 per square foot, a $28 increase

Hawksley by Beedie and British Pacific Properties has only five units remaining as they sold seven units over the First Quarter of 2023 and is blending at $1,400 per square foot

Staburn Group’s Low Rise building, Rove, recorded nine sales over the quarter as they offered a reduced deposit structure of 15 percent and a $15,000 credit

*Note that the large sales range is due to the price differences observed in West and North Vancouver.

NORTH SHORE RESALE MARKET SUMMARY

MLS Resale Highlights

There were 160 total listings, an increase by 58 when compared to the First Quarter of 2022

Compared to the First Quarter of 2022, the average time a unit is on the market has increased for High Rise and Low Rise units by 35 and 21 days, respectively, while Townhome units decreased by one day

The average per square foot sales values for High Rise and Low RIse units increased by $77 and $53, respectively, while Townhomes decreased by $40 when compared to the First Quarter of 2022

The sales range decreased by $44,000 on the lower-end and decreased by $40,100 on the upper-end for Low Rise product since four quarters ago

Two bedroom High Rise product increased in per square foot sales value by $70 while it decreased in the Low Rise product by $38 when compared to the First Quarter of 2022

The average sales price of two and three bedroom Townhome has decreased by $124,413 and $300,718, when compared to the First Quarter of 2022

MLS Resale Statistics (Product 10 Years of Age or Less)

MLS Resale by Unit Type

TRI-CITIES

The Tri-Cities will retain its ‘Green Light’ for the First Quarter of 2023. A 36 percent increase in total sales has been observed when compared to the last quarter. The 267 High Rise sales resulted in a 51 percent increase in this sector in comparison to the Fourth Quarter of 2022. Overall sales for this sub-market increased by 36 percent; the Low Rise submarket decreased by 39 percent while the Townhome submarket decreased by 29 percent. The Lunar New Year incentives helped to increase buyer activity and drive sales for the High-Rise units. Low Rise and High Rise units were absorbed relatively well at 46 and 33 percent respectively while Townhome units struggled to be absorbed at only 10 percent. There were no new projects launched in this sub-market over the first quarter of 2023. High-Rise projects continue to thrive in this marketplace while Low-Rise and Townhome projects have not been enticing buyers in this sub-market under current market conditions.

New Market Highlights

Marcon’s Elmwood sold 121 units over the First Quarter of 2023 accounting for the most High-Rise sales at an average of $1,174 per square foot

Band by Townline carried much of the market activity this quarter with 88 sold over the first quarter blending at a price per square foot of $1,157

Portwood Phase 1 (Umbra) by Edgar Development has 172 condo units and 47 townhome units coming to market in late April

Hue, by Marcon achieved 40 new sales at a blended price per square foot of $980 since starting sales in mid-2022

Sitka House, the 88-unit project by Dulex Laidler Developments accounted for 30 sales over the First Quarter of 202

TRI-CITIES RESALE MARKET SUMMARY

MLS Resale Highlights

Compared to the First Quarter of 2022, sales in High Rise, Low Rise, and Townhome products decreased by 113, 63, and 40, respectively Total listings have increased by 71 when compared to the same period last year

The average sales value per square foot for High Rise, Low Rise, and Townhomes have decreased by $13, $10, and $90, respectively, since the First Quarter of 2022

The lower end sales range for High Rise, Low Rise, and Townhome products has decreased by $40,000, $62,900, and $149,900, respectively, since the same quarter last year

The average price per square foot of a one bedroom High Rise unit has decreased by $29 while a Low Rise one bedroom has increased by $1 when compared to the First Quarter of 2022

The average sales price of a two and three bedroom Townhome decreased by $108,729 and $69,871, respectively, when compared to the First Quarter of 2022

MLS Resale by Unit Type

MLS Resale Statistics (Product 10 Years of Age or Less)

RIDGE MEADOWS

The Ridge-Meadow submarket will take a ‘Red Light’ status for the First Quarter of 2023 as sales have continued to decrease with a drop of 50 percent when compared to the Fourth Quarter of 2022. There were eight total sales in this submarket largely due to a lack of project launches, unit availability, and purchaser interest. Many project launches continued to be delayed and many active projects have been placed on hold until completion. Only one project launched in the submarket over the First Quarter of 2023, a townhome project with 23 units. Project representatives report investor activity has decreased substantially and most of the sales have been coming from local end users. Many active projects are in the framing or interior finishing stages of construction, and remaining inventory can be expected to be released throughout 2023 and into 2024. Overall absorption of remaining inventory equated to five percent this quarter.

Market Highlights

Platinum Group’s second phase of Inspire, a 108-unit Low Rise development achieved zero sales over the quarter, despite achieving nine sales over the Fourth Quarter of 2022, reportedly the project is not marketing remaining units at this time

Sequoia by Harwest Homes, a 30-unit Townhome development, sold the remaining four units over the quarter and is sold out after spending 14 months on the market and achieving a monthly absorption of 2.1 units and an overall price of $656 per square foot

Dema Developments’ second phase of townhomes, Pine Creek Estates 2 launched 23 townhomes early March 2023 and has sold three units at an overall blended price of $549 per square foot La Riviere, by Pacific Vision Development, a 111-unit Low Rise Condominium project that was expected to launch this past summer continues to be delayed and is expected to launch one-, twoand three-bedroom homes in Maple Ridge

RIDGE MEADOWS RESALE MARKET SUMMARY

MLS Resale Highlights

Total listings have increased by 41 while resales have decreased by 126 when compared to the First Quarter of 2022

The average sales value per square foot for Low Rise units and Townhomes decreased by $88 and $122 since the same quarter last year

The average sales price of a one and two bedroom Low Rise unit decreased by $45,922 and $108,667, respectively, when compared to the First Quarter of 2022

The lower bound of the sales range for Low Rise products decreased by $42,000 and the upper bound decreased by $133,900 compared to the same period last year

Since the First Quarter of 2022, the lower and upper bound of the sales range for Townhome product decreased by $160,100 and $360,000, respectively

Three bedroom Townhome units saw a decrease in average price on sold units by $184,924 over the past year

MLS Resale by Unit Type

SURREY CENTRAL/NORTH DELTA

The Surrey Central/North Delta market will keep its ‘Green Light’ status for the First quarter of 2023 after recording 393 total sales. There has been one new project launch over the quarter releasing 404 units and achieving 166 sales, of which many of the sales came from investors. More investor activity has been seen in this submarket as interest rate hikes have paused over the past couple of announcements.

The High Rise, Low Rise, and Townhome sector contributed 65, 31, and four percent of the total sales, respectively. The new inventory of new products with longer completion dates added to the submarket allowed end-users and investors to enter with the expectation that interest rates will fall by completion. With buyer activity remaining steady in this submarket, more project launches are expected in the next quarter.

Market Highlights

Anthem’s 351-unit High Rise development, Georgetown One, the first tower of the Georgetown masterplan, sold out over the first quarter of 2023 with an overall blended price of $950 per square foot

Galilea, Whitetail Homes’ 129-unit Low Rise Condominium was released at the beginning of December 2022 and recorded 109 sales to date, at an average price of $826 per square foot

Landa Global Properties’ 404-unit High Rise development, Lucent, sold 166 units at an average price per square foot of $1,017

Walker House, by BMG Real Estate sold 45 units throughout the quarter at an overall price per square foot of $1,100

SURREY CENTRAL/NORTH DELTA RESALE MARKET SUMMARY

MLS Resale Highlights

Total listings increased by 84 while resales decreased 251 when compared to the First Quarter of 2022

The months of supply for resales in the Townhouse market has increased from 1.8 months to 3.3 months when compared to the same quarter last year

The months of supply for resales for High Rise and Low Rise product has increased by 1.9 and 4.6 months, respectively, when compared to the First Quarter of 2022

The per square foot sales value has decreased for High Rise, Low Rise, and Townhomes by $25, $76, and $107, respectively, when compared to four quarters ago

One bedroom High Rise and Low Rise units saw a decrease in average price per square foot on sold units by $25 and $73 over the year

The average two and three bedroom Townhome unit have seen price decreases of $156,988 and $170,384, respectively, compared to the same period last year

MLS Resale Statistics (Product 10 Years of Age or Less)

MLS Resale by Unit Type

NEW MARKET SUMMARY

SOUTH SURREY/WHITE ROCK

The South Surrey/White Rock submarket will be upgraded to ‘Green Light’ status for the first quarter of 2023, after recording 65 total sales. This represents a significant increase compared to the minimal activity of 22 sales in the previous quarter. The large increase in sales activity was mainly driven by a new Townhome project launch, The Loop, which recorded 36 sales. This accounts for 55 percent of the total sales South Surrey/White Rock. The success of this Townhome launch was largely driven by the price point, where the average unit price was approximately $960,000. The high-rise sector continues to struggle with absorptions, as the majority of inventory is now move-in ready. The lack of new project launches in this submarket has reduced the unsold inventory by 16 percent. The much-in-demand product type in this South Surrey/White Rock continues to favor the larger, ground-oriented product types, as the majority of purchasers are noted to be end-users.

Market Highlights

Gramercy Developments launched its Townhome project, The Loop, in late January, releasing 43 units to the market with an overall value of $656 per square foot and recorded 36 sales over the quarter

Park Ridge Homes released their third low-rise building (47 units) in their low-rise development, Southaven, after selling out the first two buildings in 2021 ($712 per square foot). They recorded 15 sales, blending at an overall value of $864 per square foot

Oak Meadows, a Townhome development by Silver Star Enterprises, recorded six sales over the quarter, blending at an overall average of $706 per square foot

There was only one sale in the high-rise sector from Solterra’s Monaco project with an average value of $1,083 per square foot

There are 35 move-in-ready inventory units available in the concrete sector out of the total of 45 released and unsold inventory

SOUTH SURREY/WHITE ROCK RESALE MARKET SUMMARY

When compared to the same quarter last year, the total number of listings and resales have decreased by four and 140, respectively

The months of supply for resales for High Rise, Low Rise, and Townhome product has increased by 4.9, 0.9, and 0.8 months, respectively, when compared to the First Quarter of 2022

Average per square foot sale values for High Rise and Low Rise units decreased by $130 and $94, respectively, when compared to the First Quarter of 2022

High Rise and Low Rise products have seen an increase in average days spent on the market, averaging 46 and 31 more days on the market when compared to the First Quarter of 2022

One and two bedroom Low Rise units saw a decrease in average price per square foot on sold units by $123 and $110, respectively, over the past year

Two and three bedroom townhome product saw a decrease in average sales price by $197,853 and $161,425, respectively, compared to the same quarter last year

MLS Resale Statistics (Product 10 Years of Age or Less)

MLS Resale by Unit Type

MLS Resale Highlights

NEW MARKET SUMMARY

LANGLEY/CLOVERDALE

The Langley/Cloverdale submarket has been given a ‘Yellow Light’ status for the First Quarter of 2023, with a total of 93 sales recorded, indicating a decrease of 27 percent from the previous quarter. The sales activity in the Low Rise sector decreased steeply by 47 units, while there were 13 additional Townhome sales. Townhome sales constituted 77 percent of the total sales recorded in the quarter. Demand for Townhomes increased towards the end of the quarter, and it has been anecdotally reported that the demand for this product type under one million dollars is strong. This demand may be attributed to the announcement of a pause on rate hikes by the Bank of Canada. The Langley/Cloverdale market has also seen the continued launch of additional phases of existing projects, indicative of the stability in demand for this product type.

Market Highlights

Oakley, a new Townhome development by Warwickshire Homes, began sales in mid-February and sold 20 of its 21 units in the first phase within the first quarter, with an average price of $581 per square foot

Garcha Homes’ Union Willoughby Townhome development achieved 25 sales, with just 10 released and unsold units remaining

Canvas, a low-rise development by Redekop Reddale Group, sold 18 units in the first quarter of 2023, with a monthly absorption rate of 12.4 units since it started selling last summer

BM Group’s Heath Townhome development released additional units and recorded 16 sales at an average price of $643 per square foot

The Townhome portion of Jayen Properties’ Park & Maven has expedited its construction process and is scheduled to complete a year earlier than its original timeline, in Fall 2023

Zenterra’s Newbury Townhomes have resumed sales after being on hold for the past year, with units starting at $899,900, which is $177,000 lower than their starting price a year ago

LANGLEY/CLOVERDALE RESALE MARKET SUMMARY

MLS Resale Highlights

Resales for Low Rise and Townhome products decreased by 112 and 103, respectively, when compared to the First Quarter of 2022 Total listings decreased by two when compared to the same quarter last year

The sales range decreased by $175,000 on the lower-end and decreased by $262,500 on the upper-end for Townhome product since four quarters ago

Average price per square foot sales values decreased for Low Rise condominiums and Townhomes by $66 and $118 when compared to this quarter last year

The average price per square foot sales value for one and two bedroom Low Rise units decreased by $41 and $74, respectively, when compared to the First Quarter of 2022

Since the First Quarter of 2022, the months of supply for Townhome product has risen from 1.1 months to 1.2 months

Resale Statistics (Product 10 Years of Age or Less)

MLS Resale by Unit Type

NEW MARKET SUMMARY

The Abbotsford/Mission submarket will take a ‘Green Light’ status for the First Quarter of 2023. The submarket experienced a slight decrease in overall sales, but buyer activity remained relatively active as 121 sales were made, a 12 percent decrease from the 138 sales made in the previous quarter. The decrease in sales can be attributed to the release of a masterplan community last quarter that experienced significant absorptions. One project launched over the First Quarter of 2023, releasing 70 units into the market and 43 percent were absorbed, with interest noted as an even mix of investors and end users. The continued success of the new launches and activity in other actively selling projects showcase that buyer interest is still present in the submarket. The low entry price points, buyer incentives, and realtor bonuses attracted both end users and investors to the submarket over the quarter.

Market Highlights

Redekop Faye’s 140-unit Low Rise building, Jacob, launched 70 units in late February and sold 30 units at an overall blended price of $700 per square foot

Highstreet Village Phase 2, an 80-unit Low Rise Condominium in AB Wall’s masterplan community released in December and is sold out. The remaining 40 units sold over Q1-2023 at an overall blended price of $740 per square foot. The third building is anticipated for Fall 2023

AB Wall’s Townhomes in Highstreet Village achieved 17 sales over the quarter at an average price per square foot of $566

Rail District - Brickyard & Rail Plaza by Infinity Properties relaunched in March 2023, and sold 25 units over the quarter at a blended per square foot price of $517

Milkai Development’s Westminster Plateau, a masterplan community, released 17 Townhomes in Q42022 and sold 13 units overall at a blended price of $475 per square foot; the 54-unit Low Rise building is expected to launch sales in May

ABBOTSFORD/MISSION RESALE MARKET SUMMARY

MLS Resale Highlights

Total listings increased by 20 while total resales decreased by 99 when compared to the First Quarter of 2022

Over the past four quarters, the lower bound of the sales range for Low Rise product has decreased by $79,270 and the upper bound of the sales range also decreased by $103,500

Price per square foot sales values for Low Rise condominiums and Townhomes are down by $114 and $121, respectively, from the First Quarter of 2022

The average days spent on market for Low Rise units and Townhomes has increased by 33 and 29 days, respectively, when compared to the same quarter last year

The average Low Rise price per square foot for one and two bedroom condominiums has decreased by $222 and $100, respectively, when compared to the same quarter in 2022

The average price per square foot for two bedroom and three bedroom Townhome has decreased by $114 and $108, respectively, when compared to the First Quarter of 2022

Resale Statistics (Product 10 Years of Age or Less)

MLS Resale by Unit Type

LOOKING BACK & AHEAD

As the spring season begins, we have observed an increase in absorption throughout Metro Vancouver and the Fraser Valley. The market is continuing to stabilize and even improve as predicted, in line with the Bank of Canada’s decision to hold rates steady from January to April of this year. This has created and confirmed an optimistic outlook for the market.

Looking Back

In our previous report, we correctly predicted the stabilization of the Bank of Canada interest rates during the first quarter and into April of this year. However, the market absorptions in certain areas, particularly the North Shore and South Surrey/White Rock, may have come as a surprise.

We also discussed the new federal ban on foreign buyer ownership across Canada and how the rules implemented could further limit the supply of new housing for Canadian citizens. However, the ban’s implementation only affected 1.5% of buyers in 2021, which was the hottest market in Metro Vancouver to date. The new rules included restrictions on foreign investment in land or corporations above a certain threshold, such as development companies. Surprisingly, it appears that the government heard our industry’s concerns with the latest announcement on March 31st, which made new exemptions to the ban on land and business ownership. As predicted, we have not seen any measurable impacts on the market in terms of buyers due to this ban as it affects a very minimal number of buyers in our local market overall, even at the peak, with just 1.5% of all purchasers being foreign.

We also questioned the need for the stress test for entry-level buyers considering current interest rates. However, there has been no response from our leaders on this issue. Nonetheless, the recent exemptions announced for the Foreign Buyer’s Ban are a

positive development.

All the new mayors in each municipality are now firmly in place and are finalizing the setup of their new structures and responses to the new provincial approval mandates. Each mayor seems to be taking a different approach as they work with their staff and implement new policies that may expedite approvals. It’s important to monitor the areas where you are developing for new opportunities in approval speed and density.

The Urban Development Institute (UDI), as well as The Urban Development Institute of the Fraser Valley (UDI Fraser Valley) are excellent organizations to join, as they liaise with each city and keep their members updated on new policies, often before they are implemented. Membership allows the development community to be heard at every level of government and provides an opportunity to provide industry input in the design and implementation of new policies that affect the industry.

For more information on the institute and the various regions you can join, please visit: https://udi.bc.ca/membership/join-udi/.

Looking Ahead

With interest rates having stabilized over the last two consecutive periods and inflation currently at 5.2% at the time of writing this article, we predict at least one more rate increase by the Bank of Canada before the end of 2023. However, there are indications that inflation could decrease, and rates will likely begin to decrease in 2024.

Additionally, we anticipate that various municipalities across the Lower Mainland will implement new policies to expedite development and building permit approvals. Hopefully, this will

result in some time and cost savings for the industry as a whole.

Will we see distressed sales of development sites and/or new homes due to the significant increase in borrowing costs for some?

How do you think the market will fare for the remainder of 2023?

What moves do you expect to see from the new local councils and mayors, particularly in relation to development approval processes in the areas of your current development applications or land holdings?

Do you think consumer confidence will remain strong, or will it be affected by the Bank of Canada’s decisions this summer?

Do you believe it is important to participate in the industry through groups such as UDI? Why or why not?

If you have a view you would like to share and/or questions you would like to discuss please contact Jamie Squires at Jamie@fifthave.ca.

RESEARCH METHODOLOGY

Zonda Urban is Metropolitan Vancouver’s leading source for analytical interpretation of relevant real estate market data, trends and strategic recommendations.

Zonda Urban (formerly Urban Analytics) has been retained by Fifth Avenue Real Estate Marketing Ltd. To provide aggregate data on the Multi-family residential real estate market in the Vancouver Metropolitan. The methodology used to collect the data was as follows:

General Parameters

Metropolitan Vancouver refers to the area from West Vancouver to Abbotsford. The focus of this study is limited to the Multi-family market.

Multi-family Project Data – New Home Sales

The primary method used to collect information is a personal visit to each project being actively marketed. In addition to collecting current sales information, Zonda Urban representatives engage onsite sales staff to determine additional relevant information such as incentive offerings, traffic trends and active buyer profiles. In all instances, active sales range quoted in tables is defined as “The per square foot sales range in which 75 percent of sales of this product type occurred”

For the purposes of this publication, Zonda Urban contacts various municipal planning departments along with developers (and/or their representatives) of proposed new developments to determine the anticipated timing of their approval and marketing launch.

Multi-family Project Data – Resale

The resale market provides an important barometer from which to assess demand and determine pricing for new home projects. Accordingly, Zonda Urban closely monitors the resale market for Multifamily homes in order to identify trends that are relevant to the new home sector. However, the breadth and depth of product for sale can create findings that are less than helpful to the new home developer

As a result, Zonda Urban recommends studying only product that is aged ten years or newer and valued at less than $1.2 million. While it could be argued that limiting the analysis to newer product (i.e. five years or newer) would be more relevant to the new home sector, we believe this would limit the sample size and potentially skew the data towards a specific type of product available in a small number of specific buildings/projects. In all instances active sales range quoted in tables is defined as “The active sales range in which 75 percent of sales of this product type occurred”.

WHY ZONDA URBAN?

Zonda Urban (Formerly Urban Analytics) been monitoring the new Multi-family home market in Metro Vancouver and beyond since 1994. In addition to providing clients with the most current and accurate information on actively selling and contemplated new condominium and Townhome projects in Vancouver, Toronto, Ottawa, Calgary, Edmonton and Victoria on the market-leading NHSLive data product at nhslive.ca, Zonda Urban is also the leading provider of advisory services on the new Multi-family home market in these markets.

Zonda Urban also monitors the purpose-built rental apartment market, residential land transactions, and commercial property transaction data. Contact sales@zondaurban.com and/or advisory@zondaurban.com to learn more about these products and services.

Zonda

NHSLive

Zonda

For over 25 years, and prior to its transition to Zonda Urban, Urban Analytics provided clarity on what’s selling, who’s buying and what that means for our clients at every stage of their project.

CEO W. Scott Brown

Address 8-15243 91st Avenue

Surrey, BC V3R 8P8

Phone Number 604.583.2212

Email scott@fifthave.ca

Website fifthave.ca

President & Managing Broker Jamie Squires

Address 8-15243 91st Avenue Surrey, BC V3R 8P8

Phone Number 604.583.2212

Email Jamie@fifthave.ca

Website fifthave.ca

President Jacky Chan

Address 1480-1500 West Georgia Vancouver, BC V6G 2Z6

Email jacky@bakerwest.com

Website bakerwest.com

This document has been prepared by Fifth Avenue Real Estate Marketing Ltd. And BakerWest Real Estate Incorporated with data provided by Zonda Urban for advertising and general information only. Fifth Avenue, BakerWest, and Zonda Urban make no guarantees, representations or warranties of any kind, express or implied, regarding the information including, but not limited to, warranties of content, accuracy and reliability. Any interested party should undertake their own inquiries as to the accuracy of the information. E.&.O.E. Metropolitan Vancouver: West Vancouver to Aldergrove. Excludes Chilliwack, and Mission. Resale Data: MLS sold for attached product (High Rise, Low Rise, and Townhomes) built within the last ten years for units valued less than $1.2 million. Single family sales are excluded from the report. This publication is the copyrighted property of Fifth Avenue Real Estate Marketing Ltd. © 2023. All rights reserved.