The Fifth Dimension Fall Edition 2022

THE FIFTH DIMENSION FALL EDITION 2022

A Comprehensive Analysis of the Metro Vancouver Multifamily Market

Provided Collaboratively By:

WELCOME TO THE FIFTH DIMENSION

Shorter days, cooler weather, and the dreaded arrival of rain, rain, rain, signals the final push to year end. Like the rain greeting us every autumn, it is time for the Fall edition of the Fifth Dimension, presenting a concise summary of the new multifamily development market of the Third quarter of 2022 for Metro Vancouver and the Fraser Valley.

Fifth Avenue is a full service, suburban market-focused residential real estate marketing and sales and development marketing organization. Combined with our associated entities Vancouver-based BakerWest, Okanagan-based Epic Real Estate Solutions, and Vancouver Island-based Island Realm Real Estate, we are an integral part of British Columbia’s ever growing and changing new home market.

The season’s story is one of uncertainty for buyers and sellers alike with further interest rate hikes and cost increases to daily living. The emerging trend is a further slowdown in sales absorptions in most neighbourhoods.

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.

How certain or uncertain are you about today’s real estate market? As the Third Quarter of 2022 concludes and the October market showed signs of stability, it is fair to say that the market has officially stabilized in most neighbourhoods of Metro Vancouver. Compared to this time last year, absorptions have slowed down significantly; however, 2021 was clearly an outlier. That said, sales during the end of the second quarter and through the third quarter slowed month after month. It is interesting to note that October sales in the resale market broke a five-month trend of decline compared to months prior, albeit with moderate increases.

Like in 2019, a significant part of the story is related to developers opting to delay releasing new developments thus curtailing supply. Simply put, you cannot sell what you do not have.

The slower absorptions have resulted in the increased use of incentives and realtor bonuses. Many of these planned launches were purposefully held off but are expected to come to market in the First or Second Quarter of 2023,

assuming continued stabilization with respect to market conditions.

Developers who have maintained certainty in the neighbourhoods they are developing in, and proceeding to bring new developments in the current landscape, are adapting to help ensure the overall success of their projects.

What does this new adaptation look like? As hinted at, it includes sharp pricing, creative incentives, and possibly even realtor bonuses. Those that are able to price within the bounds of the market in their neighbourhood location, in addition to incentives and a long-term value and lifestyle story, are still selling successfully today. The definition of success today versus a year ago has simply changed as part of our adaptation to the current environment. Instead of selling out in days or even hours, developments are now reaching their pre-sale targets in months and selling the remainder at tempo. This also means prices are more stable.

The plus side of all of this is that in British Columbia, due to the Covid-19 pandemic, the British Columbia Financial Services Authority has made disclosure statements valid for 12 months of selling instead of just 9 months as it was prior to the pandemic. This means if a development is launched now it will have until the same time next year to simply reach its pre-sale requirements and obtain its building permit. We have experienced worse markets than this throughout our history in this province and still made bringing new homes to market possible in just nine months. Times are harder than they were a year ago but not anywhere near 2008/2009 figures.

The fourth quarter can typically be slower than other quarters despite market conditions. Some have opted to take this quarter to rest, recharge, and brainstorm how to adapt to the market for 2023 as well. Others, especially with product priced between $400,000 and $750,000, are charging and their fortitude is bearing fruit.

With this passage of time and season of togetherness, more people will naturally feel more certain about themselves, their current situation, and their futures. There is even rumored talk of rates getting too high and the Bank of Canada potentially starting to lower them in the new year, which would help influence consumer confidence in the market and developer confidence.

What can you do today to help with buyer confidence in pre-sales? The interest rate and unknown costs are the biggest fear drivers for most buyers. If you can work closely with lenders to have a blanket appraisal done for the

development that holds the rates until completion, these fear drivers can be eliminated as the rate is held at the rate of the date the contract is written or approval applied for, and held until completion. Should rates drop between purchase and completion, the buyer will still receive the lower rate, just not at a higher rate if it has increased. This is something experienced developers have done in other tough markets. That said, we will also repeat the fact

that the Lower Mainland and Metro Vancouver is a sought-after place to live, essentially landlocked by mountains in two directions, an ocean, and an international border. This means despite market dips, the long-term outlook for real estate in general in this area is good as we are an “in demand” location with only so much space to build.

All the best to you,

Jamie Squires

Squires

President & Managing Broker

Fifth Avenue Real Estate Marketing Ltd.

Jamie@fifthave.ca

Jamie

TABLE OF CONTENTS

WELCOME TO THE FIFTH DIMENSION 2

OVERALL MARKET SUMMARY 4-5

MARKET SUMMARIES 6-29

Vancouver Downtown 6

Vancouver West 8

Vancouver East 10

Richmond & South Delta 12

Burnaby & New Westminster 14

North Shore: North & West Vancouver 16

Tri-Cities: Coquitlam, Port Coquitlam & Port Moody 18

Ridge Meadows: Maple Ridge & Pitt Meadows 20

Surrey Central & North Delta 22

South Surrey & White Rock 24

Cloverdale & Langley 26

Abbotsford & Mission 28

Proud Peerage Realty Partner

OVERALL MARKET SUMMARY

In this Third edition of the Fifth Dimension for 2022, our data collection and analysis partner Zonda Urban (formerly Urban Analytics) shares its commentary on the most recent quarter, market performance year to date, and what to expect in the upcoming quarter with respect to Metro Vancouver’s multifamily residential real estate market.

Q3 — New Home Market

Metro Vancouver’s new home market began to show signs of a slowdown in the Third Quarter as launch activity waned and in some cases project launches were delayed until the Fourth Quarter. While more normalized buyer activity was observed during the Third Quarter, sales have dropped significantly, particularly in relation to the frenzied pace of sales experienced over the past 12 to 18 months. The 1,521 sales recorded in the Third Quarter of 2022 was the lowest Third Quarter sales total on record since 2012. Sales in the Third Quarter were 67 percent lower than the previous quarter and 72 percent lower on a yearover-year basis. There were 8,364 released and unsold units at the end of the Third Quarter, which is 12 percent higher than the last quarter and up 23 percent from the same quarter last year. There were 679 completed and unsold new multifamily homes available at the end of the Third Quarter, which is up 43 percent from the previous quarter and 11 percent higher year-over-year.

There were 5,841 released and unsold High Rise units available at the end of the Third Quarter, an 11 percent increase from the previous quarter and a 25 percent increase year-over-year. The majority of High Rise sales were in the Burnaby/New Westminster sub-market, which accounted for 24 percent of all High Rise sales during the quarter, with most sales occurring at projects in Burnaby. Combined High Rise sales in the Burnaby/New Westminster, Richmond/ South Delta, and Tri Cities sub-markets accounted for 66 percent of sales in this sector, and 28 percent of all new multifamily home sales during the quarter. Notable sales activity occurred at Keltic’s O2 (Metrotown), Marcon’s Elmwood (Burquitlam), Shape Properties’ Live at Richmond Centre (No. 3 Rd. Corridor), and Oasis by Concord Pacific (Brentwood).

Reddale Group’s Canvas (Langley City), Janda Group’s Aldergrove Town Centre (Langley) and Park & Maven by Jayen Properties (Clayton).

A total of 638 High Rise sales were recorded in the Third Quarter of 2022; a 72 percent decrease from the previous quarter, and 78 percent fewer than the same quarter last year. High Rise sales accounted for 42 percent of new home sales during the quarter.

The 682 new Low Rise condominium sales recorded in the Third Quarter of 2022 were 62 percent lower than last quarter and 58 percent fewer than the number sold in the same quarter last year. The decrease in sales can be partially explained by a decrease in project launches of this product type; 11 new Low Rise projects were launched during the quarter, which added 933 units to the market. This compares to the 23 new project launches which released 2,487 units in the previous quarter. The 1,481 released and unsold units is a seven percent increase from the previous quarter. The Langley/Cloverdale sub-market experienced the highest number of new Low Rise multifamily home sales in Metro Vancouver with 240 sold units. Notable sales activity across Metro Vancouver’s Low Rise condominium sector was noted at Marcon’s Hue (St. Johns), Anthem Properties’ Baden Park (Lynnmour/Maplewood), Whitetail Homes’ Podium (Maple Ridge), Hayer Town Centre by Hayer Builders Group (Yorkson), Redekop

A total of 201 new Townhome sales were recorded in the Third Quarter of 2022, which represents a 61 percent decrease from the previous quarter and a 79 percent year-over-year decline. There were 1,042 released and unsold Townhome units at the end of the Third Quarter, which is 26 percent higher than the previous quarter and 25 percent higher than the same quarter last year. The available Townhome inventory can be attributed to the drop in sales and the launch of 14 new townhome projects during the quarter. Strong sales activity was observed at Anthem Properties’ Baden Park (Lynnmour/Maplewood), Formwerks Boutique Properties’ The Robinsons Parkside Collection (Burquitlam), Garcha Homes’ Union (Langley), Vicini Homes’ Grace (Central Cambie Corridor), and Elwynn Green by Elegant Development (Fleetwood).

Q3 — Resale Market

A total of 1,798 newer multifamily homes were resold in the Third Quarter of 2022. This total is 37 percent lower than the previous quarter and 52 percent lower when compared to the same quarter in 2021. Comparing activity across product sectors, High Rise, Low Rise, and Townhome re-sales were 33, 38, and 41 percent lower, respectively when compared to the previous quarter and were down 46, 52, and 59 percent lower, respectively when compared to the same quarter last year. Overall active listings decreased by 10 percent when compared to the previous quarter

OVERALL MARKET SUMMARY - CONTINUED

and increased by 30 percent relative to the same quarter last year. Active listings for High Rise, Low Rise, and Townhome products did however decrease by five, 16, and 12 percent, respectively when compared to the Second Quarter of 2022.

Q3 — Observations and Opinions

There was a noticeable drop in sales activity during the Third Quarter of 2022 relative to the record-breaking pace of the previous 12 to 18 months. The 1,521 reported sales were the lowest number of recorded sales in a Third Quarter since 2012. As experienced in the Second Quarter of 2022, the Bank of Canada implemented further increases to its overnight lending rate in a continued attempt to reduce inflationary pressures in the economy. Two rate increases were implemented by the end of the Third Quarter, and at the time of writing this publication, the overnight lending rate has increased further to 3.75 percent. Higher borrowing rates and economic uncertainty have been the primary factors contributing to buyer hesitancy in the Third Quarter. It should be noted that while purchasing activity has been down recently, overall demand for housing remained strong in Metro Vancouver as our population continued to grow and more pressure was placed on the rental sector of the housing market. Rental rates in Metro Vancouver achieved all-time highs at the end of the Third Quarter. It is anticipated that purchasing activity will rebound significantly after interest rates stabilize and when rents increase to a point where purchasing is deemed more economical than renting. It’s possible that this could occur in the Second or Third Quarter of 2023 based on the current trends. Several projects that launched at the end of the Third Quarter and at the beginning of the Fourth Quarter achieved more than 50 percent pre-sales and many project launch events attracted

hundreds of attendees, which indicates that appropriately priced projects in desirable locations are still garnering buyer interest.

There were 8,364 released and unsold units remaining at the end of the Third Quarter, a 12 percent increase from the previous quarter despite having nearly 3,000 fewer units released during the quarter than in the Second Quarter of 2022. The absorption rate of newly released products decreased from 48 percent to 29 percent when compared to the previous quarter.

Notable projects that could launch in the Fourth Quarter of 2022 or in the First Quarter of 2023 include: Vancouver Downtown –Brivia Group’s CURV, Landa Global Properties and Asia Standard Development’s 1400 Alberni; Vancouver West - Solterra’s Italia, Hon Development’s 5656 Balaclava, Alabaster’s Thesis; Vancouver East - Wesgroup’s Ardea, Bucci Developments’ 2550 Garden Drive, First Track Development’s Woodland Block ; BurnabyShape Properties’ Amazing Brentwood Tower 6, Areva Living’s First and Royal, Symphony Homes’ Moonlight Sonata; North Shore - Anthem Properties’ Eastwoods, Polygon Homes’ Lennox; TriCities - Anthem Properties’ SOCO Phase 2, Allaire & The Circadian Group’s Florin, Adera’s Sol; Richmond/South Delta – Onni’s Riva 4, Polygon’s Westhampton, Century Group’s The Granary; South Surrey/White Rock - Gramercy Developments’ The Loop, PCC Homes’ Glenmont; Central Surrey/North Delta - Concord Pacific’s The Piano, Westland’s Core, BlueSky Properties’ Parkway Phase 2; Langley/Cloverdale – Inspira’s Insignia, Mortise’s Unison, Infinity Properties’ Heath; Abbotsford/Mission - Pacific Hills Development’s Westminster Plateau, ABWall’s The Remarkable Highstreet Village; Ridge-Meadows - Pacific Vision Development’s La Riviere, Dema Developments’ Pine Creek Estates Phase 2.

Comparison Totals Q3-2022

High Rise 2,262 8,919 7,003 -21% Low Rise 1,762 5,439 4,045 -26% Townhomes 2,899 4,278 1,372 -68% Total 6,923 18,636 12,420 -33%

Resale Market Totals Q3 - 2022

The Downtown Vancouver submarket will have a ‘Red Light’ status for the Third Quarter of 2022. Total sales decreased by 82 percent when compared to the last quarter, with 13 sales recorded over the quarter. The decrease in sales can be attributed due to the lack of new inventory in the submarket. Only two of 13 projects in Downtown Vancouver recorded sales and there were no project launches observed over the Third Quarter of 2022. Four percent of the available inventory was absorbed in this submarket, a 14 percent decrease when compared to the previous quarter.

New Market Highlights

Landa Global Properties’ High Rise development, 1818 Alberni, achieved eight sales over the Third Quarter of 2022 with a realtor incentive of six percent commission on select homes

The Pacific, a High Rise Condominium by Grosvenor, reported five sales over the quarter with 24 move-in ready homes remaining

Fifteen Fifteen by Bosa Properties recorded 40 sales in the year 2022 with 85 released and unsold units

Brenhill’s High Rise Condominium, 8X On The Park, has sold 190 units since commencing sales in May 2016 and has one move-in ready unit remaining There are 37 move-in ready homes in this submarket

VANCOUVER DOWNTOWN RESALE MARKET SUMMARY

MLS Resale Highlights

Average sales values per square foot have increased by $37 when compared with the Third Quarter of 2021 for High Rise product

The number of High Rise listings has increased from 223 to 234, while High Rise resales decreased by 93 when compared to the Third Quarter of 2021

The average per square foot values of one bedroom High Rise condominiums increased by $48 while the two bedroom High Rise condominiums decreased by $38 since the Third Quarter of 2021

The months of supply for resales in the High Rise market has increased from 4.4 months to 11.9 months when compared to the same quarter last year

The sales range has decreased by $15,100 on the lower end and increased by $92,512 on the higher-end over the past four quarters for High Rise product

The average time a unit is on the market has decreased for High Rise by 19 days since the Third Quarter of 2021

Vancouver West will have a ‘Yellow Light’ status for the Third Quarter of 2022 as this submarket recorded 98 sales, a 65 percent decrease from the previous quarter. The High Rise sector led all sectors in sales activity as it contributed 55 percent of total sales in the submarket but compared to the previous quarter, this sector dropped in sales by 75 percent. Overall absorption rates have decreased to nine percent, a 41 percent decreased when compared to the Second Quarter of 2022.

The Low Rise sector saw a 25 percent decrease in sales while the Townhome sector saw a 29 percent increase in sales. Despite reduced sales activity and market conditions, new projects continue to be introduced to the submarket as five projects were released this quarter – two High Rise and three Townhome projects – which added 113 units to the market with 20 percent absorbed.

New Market Highlights

Elm41, a 23-unit concrete Condominium project by iFortune launched in mid-July, reported three sales at an overall blended price of $1,813 per square foot

Kenstone Properties’ 46-unit concrete Condominium, Carven, began sales in mid-August and released 10 units with no sales to date at an overall blended price of $2,011 per square foot

Grace by Vicini Homes is a 43-unit Townhome project that was released in early July and reported 15 sales at a blended price of $1,401 per square foot

Forme Development released the second phase of King & Columbia, a 14-unit Townhome project in early September and achieved four sales at a blended price of $1,420 per square foot

Boden by Listraor, a 35 unit Townhome project commenced sale in early August and sold one home at a blended price of $1,294 per square foot

Hon Developments is anticipated to release 5656 Balaclava, a 79-unit concrete Condominium project in the Third Quarter of 2022

VANCOUVER WEST RESALE MARKET SUMMARY

MLS Resale Highlights

Total resales and listings have decreased by 118 and 35, respectively, when compared to the Third Quarter of 2021

The average time a unit is on the market has decreased for High Rise by 3 days while Low Rise and Townhomes increased by 23 and 40 days, respectively, since the Third Quarter of 2021

Average price per square foot sales values for High Rise and Townhome units have increased over the past four quarters by $71 and $29, respectively, while Low Rise units experienced no change

Two bedroom High Rise and Low Rise product saw increases of $45 and $4 in average price per square foot sales values when compared to four quarters ago

The sales range has increased by $58,000 on the lower end and by $110,900 on the higher end since the Third Quarter of 2021 for High Rise product

The Townhomes sales range has increased by $18,800 on the lower end and decreased by $800 on the higher-end over the past four quarters

High

$1,554,900

$1,160,000

$2,480,000

The Vancouver East submarket will have a ‘Red Light’ status after recording 25 total sales in the Third Quarter of 2022, a decrease of 86 percent from the previous quarter. Despite there being a total of four new project launches over the quarter releasing 70 units into the submarket, sales activity remains low as the new units achieved an absorption rate of 11 percent with one project unable to achieve a sale. Compared to the Second Quarter of 2022, High Rise and Low Rise sales decreased by 99 and 65 percent, respectively while the Townhome sector saw an increase of 7 sales. Overall absorption rates decreased to five percent compared to the 28 percent achieved in the previous quarter. With current market conditions, it has been reported that developers will revise their sales strategy to increase activity while some had to increase prices to compensate for rising construction costs.

Market Highlights

Grafia by Porte Communities recorded 15 sales over the Third Quarter of 2022 with decreased deposit structures

Hudson Projects launched two Townhome Projects, Block 1910 and Broadhurst & Whitaker in midJuly releasing a total of 26 units into the submarket. Block 1910 achieved three sales at an overall blended price of $1,239 per square foot while Broadhurst & Whitaker achieved four sales at $1,291 per square foot

Georgia Pacific Holdings Corp. released Gemini Mount Pleasant (previously called Grand and owned by Green Oak Development) in Late July, a near-completed 18-unit concrete Condominium, and achieved zero sales at an overall blended price of $1,429 per square foot

V on E49, a 26-unit Low Rise Condominium by 1969 East 49th Avenue Ltd Partnership commenced sales in early September and reported one sale at an overall blended price of $1,250 per square foot

Bucci is anticipated to release 2550 Garden Drive, a near completed 69-unit Low Rise Condominium in the Fourth Quarter of 2022 that will complete construction in Winter 2022

VANCOUVER EAST RESALE MARKET SUMMARY

MLS Resale Highlights

The average time a unit is on the market has increased for both High Rise and Low Rise by 1 day while Townhomes decreased by 1 day since the Third Quarter of 2021

Average price per square foot sales values for High Rise, Low Rise, and Townhome units have increased by $98, $30, and $76, respectively

The months of supply for resales in the Low Rise market has increased from 1.2 months to 4.7 months when compared to the same quarter last year

The average price per square foot in a Low Rise for a one bedroom unit is up $40 while it is down by $22 for a two bedroom unit since the Third Quarter of 2021

Total resales have decreased by 145 when compared to the Third Quarter of 2021, while total listings have increased by 33 in that same time span

The average price per square foot for two bedroom and three bedroom Townhome units has increased by $14 and $82 since the Third Quarter of 2021, respectively

High

$860,000

The Richmond/South Delta submarket will have a ‘Yellow Light’ status after recording 145 total sales in the Third Quarter of 2022, a decrease of 61 percent from the previous quarter. Sales continue to be a mix of investors and end users with a heavier focus on end users in South Delta. The majority of sales have been driven by the High Rise sector as it accounted for 79 percent of all total sales. Whereas the Low Rise and Townhome sector saw significant decreases in sales activity as it dropped by 93 and 63 percent, respectively, when compared to the Second Quarter of 2022. There has been one High Rise project launch that released 143 units onto the market and 12 percent of those units have been absorbed. The overall absorption rate in the Third Quarter of 2022 reached 13 percent with the Low Rise sector achieving the highest absorption rate of 17 percent.

Market Highlights

Grand Long’s multi-phase High Rise project, One Park, released its third phase in early July, releasing 143 units and selling 17 units at an overall blended average of $1,200 per square foot

Live at Richmond Centre Buildings 3 to 6 by Shape Properties has achieved 50 sales over this quarter and will now be pausing sales to prepare for their next phase

Luxe Landsdowne by Townline achieved 16 sales over the Third Quarter of 2022 with no incentives being offered

Tsawwassen Landing by Onni Group reported 10 sales over the quarter with 27 units left that are released and unsold

Century Group will continue to release more units to their Southlands masterplan as they anticipate to launch a 35-unit Townhome project called The Granary

RICHMOND/SOUTH DELTA RESALE MARKET SUMMARY

MLS Resale Highlights

Total resales have decreased from 495 to 199 when comparing to the Third Quarter of 2021

The High Rise sales range has increased by $70,000 on the lower end and by $172,000 on the higher-end when comparing to the same quarter in 2021

The sales range of Townhomes increased by $58,100 on the lower end, while the top-end price range increased by $51,000 when compared to the Third Quarter of 2021

Average per square foot sales values of High Rise, Low Rise, and Townhome units increased by $59, $90, and $68, respectively, when compared to four quarters ago

Price per square foot sales values for one bedroom High Rise units have increased by $81, while one bedroom Low Rise units have increased by $111 over the past four quarters”

The average sales price of a two and three bedroom Townhomes increased by $31,982 and $86,086, respectively, since the Third Quarter of 2021

BURNABY/NEW WESTMINSTER

The Burnaby/New Westminster submarket will have a ‘Yellow Light’ status for the Third Quarter of 2022 recording 198 total sales, a 66 percent decrease from the previous quarter. The High Rise sector predominately represented total sales in this submarket as it represented 99 percent of total sales in the last quarter but it has dropped to 58 percent. It experienced a 26 percent decrease in sales and the Low Rise sector saw much more activity this quarter as it achieved 65 sales compared to the zero sales recorded last quarter. This can be attributed to two new Low Rise project launches releasing 126 units into the submarket, 50 percent of those absorbed. There also has been two new High Rise developments in Metrotown and two new Townhome projects releasing 331 additional units. The overall absorption rate achieved this quarter is nine percent.

Market Highlights

O2 by Keltic, a 285-unit High Rise Condominium was released in early July and sold 81 units at an average value of $1,300 per square foot

Kirpal Group’s 91-unit High Rise development, Contour Metrotown, commenced sales in early July and sold 15 units at a blended value of $1,339 per square foot

It is anticipated that Shape Properties will release their sixth tower of The Amazing Brentwood masterplan, a 369-unit High Rise in the Fourth Quarter of 2022

Arbour, Intergulf’s Low Rise and Townhome development near Burnaby Mountain, released 79 units and sold 61 units at an overall blended price of $867 per square foot for the Low Rise Condominium and $699 per square foot for the Townhome Symphony Group is anticipated to launch Moonlight Sonata, a 130-unit Townhome development in Q4-2022

Polygon’s Low Rise and Townhome Development, Byrnepark, was launched in late September and has sold 9 units at an average price per square foot of $991 for the Low Rise section and $1,056 for the Townhome

BURNABY/NEW WESTMINSTER RESALE MARKET SUMMARY

MLS Resale Highlights

Total resales have decreased by 214 when compared to the Third Quarter of 2021, while total listings have decreased by 32 in that same time span

The average per square foot sales values of High Rise, Low Rise, and Townhomes have increased when comparing to the Second Quarter of 2021 by $56, $58, and $69, respectively

The sales range of High Rise product increased by $25,500 on the lower end, while the top-end price range increased by $32,000 when compared to the Third Quarter of 2021

Compared to the Third Quarter of 2021, the average price per square foot of one bedroom High Rise and Low Rise product has increased by $47 and $63, respectively

The average price per square foot of two bedroom High Rise and Low Rise products has increased by $60 and $38, respectively, over the past year

The average sales price of two and three bedroom Townhomes have increased by $129,289 and $32,278, respectively, when compared to the Third Quarter of 2021

High

NORTH SHORE

The North Shore holds the ‘Yellow Light’ status for the Third Quarter of 2022 after recording 146 sales, a 31 percent decrease from what was observed in the Second Quarter of 2022. There has been a total of four new project launches, one High Rise, one Low Rise, and two Townhome projects during the Third Quarter. These new launches accounted for 252 new units being released while having an absorption rate of 39 percent. All inventory had an absorption rate of 24 percent, an 18 percent decrease when compared to the Second Quarter. Buying activity from investors was significantly reduced by interest rate hikes in the High Rise sector as total sales decreased by 65 percent. Buying activity from end users in the Low Rise and Townhome sectors was less affected by the interest rate hikes as sales increased by 24 and 238 percent, respectively.

Market Highlights

Terza, a 15-unit Townhome development by Nam Development Ltd., released 11 units in early July and sold four units at an overall blended price of $1,032 price per square foot

Mirage Pacific Lyte’s, 1331 Ambleside, started sales in early August and sold six of 16 units over the quarter at a blended price of $2,048 per square foot

Baden Park (Yew), the first Low Rise building in Anthem’s Baden Park masterplan is a 119-unit Low Rise development by Anthem that commenced sales in mid-August and recorded 42 sales at a blended price per square foot of $1,046

The Townhome portion of Baden Park, Baden Park (Seymour), was released by Anthem in midAugust and recorded 18 sales out of the 102 released at an overall average value of $905 per square foot

Executive on the Park by Executive Group Development recorded 19 sales after reducing their overall blended value to $1,687 per square foot, a $86 decrease, and offering investor oriented incentive of a guaranteed 2-year rent

*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 174 total listings, which experienced no change when compared to the Third Quarter of 2021

Compared to the Third Quarter of 2021, the average time a unit is on the market has decreased for High Rise, Low Rise and Townhome units by 9, 13, and 8 days, respectively

The average per square foot sales values for High Rise, Low Rise, and Townhomes have increased when comparing to the Third Quarter of 2021 by $28, $61, and $56, respectively

The sales range increased by $80,000 on the lower-end and increased by $161,900 on the upper-end for Low Rise product since four quarters ago

Two bedroom High Rise product decreased in per square foot sales value by $4 while it increased in the Low Rise product by $40 when compared to the Third Quarter of 2021

The average sales price of two and three bedroom Townhome has decreased by $184,443 and $83,471, when compared to the Third Quarter of 2021

High

TRI-CITIES

The Tri-Cities will retain its ‘Green Light’ for the Third Quarter of 2022. Despite decreased transactions, four new projects were released onto the market and of the 661 new units released, 36 percent of it has been absorbed. The increased pricing of the newly launched projects partially accounts for rather slowed absorptions. The lack of Townhome products in this submarket resulted in positive absorption of the newly launched townhome project, even with completion being two years out. Decreased deposit structure promotions along with incentive offerings ranging from $5,000 to $30,000, have helped with sales activities, attracting both end-users to get into the market and investors to pull the trigger despite current market conditions. Regular seasonality of the market has returned, unlike the frenzied market activity in the past quarters as summer months have been slow generally throughout with activity picking up in September. Continued project launches are anticipated for the following quarter.

New Market Highlights

Marcon’s 335-unit High Rise development, Elmwood, achieved 100 sales at an average blended price per square foot of $1,174 since commencing sales in early July

Band, a 384-unit High Rise development by Townline, recorded 17 sales over the quarter (101 total sales) at an average value of $1,157 per square foot

Marcon’s Low Rise 222-unit Low Rise development, Hue, launched in mid-July and reported 85 sales blending at $980 per square foot

Polygon’s Low Rise development, Skylark, commenced sales in early/mid-September and recorded 38 sales at an average value of $900 per square foot

Porte’s Low Rise development, Bastille, recorded 23 sales over the quarter with decreased deposit structures and incentive offerings ranging from $10,000 - $15,000

Formwerks’ second phase of their Townhome development, The Robinson, commenced sales in late July and recorded 20 sales at an average value of $860 per square foot with an average size of 1,196 square feet

TRI-CITIES RESALE MARKET SUMMARY

MLS Resale Highlights

Compared to the Third Quarter of 2021, sales in High Rise, Low Rise, and Townhome products decreased by 87, 11, and 31, respectively

Total listings have increased by 112 when compared to the same period last year

The average sales value per square foot for High Rise, Low Rise, and Townhome products have increased by $74, $109, and $31, respectively, since the Third Quarter of 2021

The lower end sales range for High Rise, Low Rise, and Townhome products has increased by $50,100, $64,000, and $90,100, respectively, since the same quarter last year

The average price per square foot of a High Rise one bedroom is up by $73 while it is up by $129 for a Low Rise one bedroom compared to the Third Quarter of 2021

The average sales price of two and three bedroom Townhome has increased by $158,729 and $95,393 when compared to the Third Quarter of 2021

High

Townhome

RIDGE MEADOWS

The Ridge-Meadow submarket will take a ‘Yellow Light’ status for the Third Quarter of 2022 as sales decreased by 53 percent when compared to the Second Quarter of 2022. Most of the sales can be attributed to one Low Rise project accounting for 96 percent of overall sales. Sales were mostly driven by investors and younger end-users. The remaining four percent of sales were recorded in the Townhome sector. Project representatives across all sectors reported that sales activity and interest in the Ridge-Meadows submarket decreased immensely in the second half of the year, evidenced by the decrease in Low Rise and Townhome sales by 48 and 60 percent respectively when compared to Q2-2022. Overall absorption equated to 27 percent, largely due to the sales in the Low Rise sector which absorbed 35 percent of unsold inventory. Four percent of Townhome product was absorbed over Q3-2022.

Market Highlights

Whitetail Homes’ 125-unit Low Rise development, Podium, launched sales in early June at a blended price per square foot of $698 and sold 94 units to date

La Riviere, by Pacific Vision Development, a 111-unit Low Rise Condominium project is expected to launch one-, two- and three-bedroom homes in Maple Ridge soon

Azure Group’s 16-unit Townhome project, Hillside Homes, started sales in mid-April at an average blended price per square foot value of $744 and reported five sales at the end of the quarter

Provenance, by Polygon Homes has 19 units released and unsold remaining and is blending at an average value of $528 per square foot

RIDGE MEADOWS RESALE MARKET SUMMARY

MLS Resale Highlights

Total listings have increased by 37 while resales have decreased by 53 when compared to the Third Quarter of 2021

The average sales value per square foot for Low Rise and Townhome products have increased by $99 and $43, respectively, since the same quarter last year

The average sales price of one and two bedroom Low Rise units increased by $53,411 and $45,904, respectively

The lower bound of the sales range for Low Rise products increased by $42,900 while the upper bound decreased by $30,000 compared to the same period last year

Since the Third Quarter of 2021, the lower and upper bound of the sales range for Townhome product increased by $20,000 and $65,000, respectively

Two bedroom and three bedroom Townhome units saw an increase in average price on sold units by $48,750 and $28,824, respectively, over the past year

The Surrey Central/North Delta market holds the ‘Yellow Light’ status for the Third Quarter of 2022 after recording 167 sales, an 87 percent decrease when compared to the previous quarter. Total sales across all sectors have been reduced drastically as High Rise, Low Rise, and Townhome sales decreased by 87, 89, and 76 percent, respectively when compared to Q2-2022. It has been reported that due to worsening market conditions due to interest rate hikes, buying activity has been reduced, and limited new project launches. There only has been one new project release which is a Townhome project releasing 32 units into the submarket with 72 percent absorbed. Developers have offered improved incentive programs including reduced deposit structures and up to $10,000 credit to counter the significant decrease in activity. With decreased transactions over the quarter, the submarket saw an overall absorption rate of 12 percent.

Market Highlights

Elegant Development’s Townhome project, Elwynn Green, released 32 units out of 173 and sold 23 units at an overall blended value of $667 price per square foot

Fleetwood Village Two by Dawson + Sawyer achieved 27 units on their third Condominium building over the quarter with a reduced deposit incentive and $10,000 off all homes

Anthem’s 355-unit High Rise development, Georgetown Two is anticipated to release 260 units at the beginning of the Fourth Quarter of 2022 Pura, a 136-unit Low Rise development by Adera, is expected to release 136 units in Early October 2022

The first building of Hartley by Porte recorded 23 new sales over Q3-2022 while offering multiple deal bonuses for realtors

MLS Resale Highlights

Total listings increased by 137 while resales decreased 247 when compared to the Third Quarter of 2021

The months of supply for resales in the Townhouse market has increased from 0.7 months to 6.8 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 1.7 and 2.6 months, respectively, when compared to the Third Quarter of 2021

The per square foot value has increased for High Rise, Low Rise and Townhomes by $100, $116, and $57, respectively, when compared to four quarters ago

One bedroom High Rise and Low Rise units saw an increase in average price per square foot on sold units by $99 and $121 over the year

The average two and three bedroom Townhome unit have seen price increases of $143,433 and $86,289, respectively, compared to the same period last year

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MLS Resale by

SOUTH SURREY/WHITE ROCK

The South Surrey/White Rock submarket will be given a ‘Yellow Light’ status as sales declined by 74 percent when compared to the Second Quarter of 2022. The decrease in overall sales is largely due to the lack of new inventory, as only one new project was released to the submarket. Sales in the Low Rise sector fell by 90 percent when compared to the previous quarter. Buyers showed that there is demand for completed Townhomes as seen with a new Townhome project launch that was released this quarter. It was released as a finished product and sold eight out of the nine total Townhome sales in the quarter. The market saw an overall absorption rate of 21 percent compared to the previous quarter of 43 percent. Project representatives have reported a slowdown in investor interest; however, end-user interest remains the same.

Market Highlights

Silver Star Enterprises’ 22-unit Townhome project, Oak Meadows, started sales in August and sold eight units at a blended price per square foot of $706

Douglas Green Living – Condos, a Low Rise project by Panorama West, has two units remaining after starting sales in early April at a blended price per square foot of $913

RDG Management Ltd’s 178-unit High Rise project, Soleil, has sold five units over the Third Quarter of 2022 at a blended price per square foot of $948

Altus, a High Rise by Ovledo Properties, recorded 14 sales in the Third Quarter of 2022 with a reduced deposit structure incentive

Gramercy Development’s, 194-unit Low Rise project, The Loop, is anticipated to launch in the Winter of 2022.

SOUTH SURREY/WHITE ROCK RESALE MARKET SUMMARY

MLS Resale Highlights

When compared to the same quarter last year, the total number of listings have increased by 67 while resales have decreased by 110

The months of supply for resales for High Rise, Low Rise, and Townhome product has increased by 5.2, 1.3, and 3.6 months, respectively, when compared to the Third Quarter of 2021

Average per square foot sale values for High Rise and Low Rise product has increased by $66 and $91, respectively when compared to the Third Quarter of 2021

High Rise and Low Rise product have seen a decrease in average days spent on the market, averaging 42 and 19 fewer days on the market

One and two bedroom Low Rise units saw an increase in average price per square foot on sold units by $106 and $73 over the past year

Two and three bedroom townhome product saw an increase in average sales price of $59,782 and $79,392, respectively, compared to the same quarter last year

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LANGLEY/CLOVERDALE

The Langley/Cloverdale submarket will retain its ‘Green Light’ status after recording a total of 264 sales, despite experiencing a 50 percent decrease in total sales when compared to the previous quarter. There has been a total of three new project launches, two Low Rise projects, and one Townhome project over the quarter releasing 173 units with 50 percent of it being absorbed. The new product introduced to the submarket experienced a price drop compared to other projects released in Q2-2022. With reduced pricing on new projects and incentives including decreased deposit structures and assistance with mortgage payments, sales activity continues to persist despite current market conditions. Total sales continue to be heavily focused on the Low Rise sector as it accounted for 91 percent of total sales. An overall absorption rate of 40 percent has been achieved over the Third Quarter of 2022 with the Low Rise sector absorbing 47 percent of unsold inventory.

Market Highlights

Canvas, a 92-unit Low Rise Condominium by Redekop Reddale Group commenced sales in late August and achieved 60 sales at an overall blended price of $806 per square foot

Janda Group’s Aldergrove Town Centre masterplan released its fourth building, Creekside, a 66unit Low Rise Condominium that reported 19 sales at an overall price of $810 per square foot

The second phase of Avery Living by Townside Developments was released in Q3-2022, a 15-unit Townhome project and achieved 7 sales at an overall price of $692 per square foot

Hayer Town Center by Hayer Builders Group achieved a total of 77 sales across their four Low Rise Condominiums buildings with incentives of reduced deposit structures and no assignment fee Park & Maven’s first two buildings, Cardinal and Heron, by Jayen Properties reported 70 sales over the Third Quarter of 2022 with a reduced deposit structure

LANGLEY/CLOVERDALE RESALE MARKET SUMMARY

MLS Resale Highlights

Resales for Low Rise and Townhome products decreased by 191 and 153, respectively, when compared to the Third Quarter of 2021

Total listings increased by 116 when compared to the same quarter last year

The sales range increased by $55,000 on the lower-end and increased by $62,000 on the upper-end for Townhome product since four quarters ago

Average price per square foot values rose for Low Rise condominiums by $105 and rose by $27 for Townhomes when compared to this quarter last year

The average price per square foot value for one and two bedroom Low Rise units rose by $89 and $93 when compared to the Third Quarter of 2021

Since the Third Quarter of 2021, the months of supply for Townhome product has risen from 0.6 months to 3.4 months

ABBOTSFORD/MISSION

The Abbotsford/Mission market will take a ‘Yellow Light’ status for the Third Quarter of 2022 given the decrease in sales by 91 percent. Like other Fraser Valley markets, sales activity decreased immensely in the latter half of the year as evidenced by the decrease in sales, mostly due to the lack of project launches. One Low Rise project released at the end of the Second Quarter of 2022 can account for the total four sales recorded over the quarter. Sales in the Low Rise and Townhome sectors decreased by 83 and 100 percent respectively. In the Low Rise sector, 27 percent of available inventory was absorbed into the market. Unsold inventory remained relatively stagnant throughout the quarter, and project representatives report that the majority of inventory had been absorbed in the first half of the year. Developers are therefore holding back the remaining inventory or are not actively marketing until completion.

The Remarkable High Street Village by AB Wall is set to launch in the Fourth Quarter and will give a better sense of this market neighbourhood that has been lacking product throughout 2021. The marketing company has leaked very high interest with initial previews in mid-October.

Market Highlights

Jem, a 97-unit Low Rise project by Quanterra Developments Ltd, released 11 homes with one bedroom units starting at $449,900 and two bedroom units starting at $599,900 and sold four units over Q3-2022

Parcel 7’s Low Rise development, Montvue, has four units remaining unsold, blending at $776 per square foot, and has closed the presentation center; a second phase will be released in Fall 2023

Rail District by Infinity Properties, a master-planned community, had a soft release of the Townhomes in Q2-2022 and sold 5 units; the remaining inventory is held back until the end of 2022

Milkai Development’s masterplan community, Westminster Plateau, consists of 36 townhomes; the first phase starts at $769,900 and will be launching late Fall 2022

Highstreet Village, a master-planned community by ABWall consists of 157 Townhomes and eight multi-phased Low Rise buildings; Phase one of the Townhomes and Condominiums will begin previews late October 2022

ABBOTSFORD/MISSION RESALE MARKET SUMMARY

MLS Resale Highlights

Total listings increased by 72 while total resales decreased by 102 when compared to the Third Quarter of 2021

Over the past four quarters, the lower bound of the sales range for Low Rise product has increased by $29,900 while the upper bound of the sales range has increased by $80,100

Price per square foot sales values for Low Rise condominiums are up $49 and price per square foot sales values for Townhomes are up $3 from the Third Quarter last year

The average days spent on market for Low Rise product has decreased by 3 days, while Townhome product has increased by 29 days

The average Low Rise price per square foot has decreased by $16 for one bedroom condominiums and increased by $80 for two bedroom condominiums when compared to the same quarter in 2021

The average price per square foot for two bedroom Townhome has decreased by $1 and increased by $30 for three bedroom Townhome when compared to the Third Quarter of 2021

LOOKING BACK & AHEAD

As predicted last quarter, prices decreased and began to stabilize in most neighbourhoods. That being said, more interest rates by the Bank of Canada have created concern and uncertainty. Strangely the last increase of .50 versus .75 or higher provided a sense of relief.

Looking Back

As expected, further interest rate increases over slowed sales absorptions. We certainly have seen price points begin to stabilize in most areas in response. We anticipated a number of developers would delay launches and others, especially in the more suburban markets, would forge ahead. We caution people not to compare this year to last year given the outlier that it was but instead to consider the three-to-four-year trend and the 10-year average.

We expressed our perspective on the importance of housing policy and the likelihood it would be a significant influence on the outcomes. This certainly was the case.

We also expressed concerns about voter turnout. It appears British Columbians did in fact vote for change, despite overall voter turnout dropping slightly to around 37% overall. Many communities saw notable changes in both mayors and councillors including two of the largest cities – Vancouver and Surrey.

Various mayors chose not to pursue another term leading to necessary change in the cities of Victoria, Abbotsford, Langley Township, Port Moody, New Westminster, and the District of Squamish. Other incumbent mayors were defeated, often by known people: current and former councillors, and candidates who were elected to another level of government across the Lower Mainland. This was the case in West Vancouver, White Rock, Maple Ridge and the City of Langley, meaning a huge change to regional boards and committees at Metro Vancouver and TransLink.

Most campaigns centered on collaboration, public safety, and taking an active role on housing and growth-related issues. This emerged as a key theme amongst many successful candidates as predicted in our last issue.

In terms of immigration and its affect on our real estate market, we have seen only a modest slight increase of plus or minus, about half a percent in 2022 compared to 2021 despite the government’s goals to allow up to 400,000 new immigrants to Canada over 2021. This means immigrants are coming and still laying down roots to prepare to qualify for a home purchase. Based on this we expect to see a slight increase in the rate of foreign ownership in 2023 and 2024, as the market and economy also stabilize. Potentially, up to 2% of all sales, instead of under 1% as we have seen over the past 4 to 5 years.

Looking Ahead

Looking ahead we see more stabilization in the market and do not predict any further interest rate increases in 2022. We predict the Bank of Canada will likely increase rates moderately into 2023 and then may consider a moderate reduction in Summer 2023. If the interest rates remain unchanged for the next quarter, this will also help instill consumer confidence in the market.

Inflation with respect to land prices and building costs, while not significantly occurring yet, could be part of the 2023 story. Although energy prices are not likely to decrease given the current conflict in the East and we do not mean Ottawa. Or do we?

Additionally, we anticipate delayed launches and improved absorption rates in 2023, which will again influence consumer confidence and reducing the uncertainty they have felt over the second and third quarters this year. With an eye on 2023, we predict 2023 overall to be more in line with 2016, albeit at overall prices when 2016 was basically a stable year.

As we head into the holiday season and pressed to sell the last homes of 2022, our teams across the province are asking themselves the following:

What are the implications of the outcomes of the civic election? Which municipalities will become more collaborative with the development industry? Which not so much?

Will the provincial government need to step in as proposed in 2023 to address the supply issue and expedite approvals? The supply issue remains a real one even though it may appear to be “hiding in the woods” of slower absorptions in late 2022. We expect it to be a big story again a year from now.

Which market areas will be the most active in 2023, and the least? Overall we anticipate a stable 2023.

We invite you to share your predictions with us.

If you have a view you would like to share and/or questions you would like to discuss please contact Jamie 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 multifamily 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 multifamily market.

Multifamily 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.

Multifamily 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 multifamily 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 multifamily 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.

Anyone who knows us knows we love to talk real estate. Let’s chat about how we can help you with your project or set you up with a subscription to NHSLive.

Michael Ferreira

Principal, Advisory Zonda Urban michael@urbananalytics.ca

Jon Bennest

Vice President, Product Development

Zonda Urban jon@urbananalytics.ca

Zonda Urban (Formerly Urban Analytics) (604) 569-3535 zondaurban.com

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. © 2022. All rights reserved.