A promising presale market in Metro Vancouver and the Fraser Valley is sparking optimism among real estate buyers.
Three presale projects launched in January, increasing to six in February for a total of 1,024 units, according to a March 12 report from MLA Canada.
The real estate services firm forecasts 14 projects will launch this month with an estimated total of 2,150 units, making for 23 projects underway since 2024 kicked off.
“Similar to the resale market, the spring is the best time to be selling projects. … Daylight savings comes around, the weather gets better and it gives people a more optimistic outlook. And that's definitely tied to the psychology of housing demand in the spring,” said Garde MacDonald, director of advisory with MLA Canada.
“This is something we actually didn't see last year because of the more depressed market conditions and uncertainty around interest rates.”
Ten projects launched between January and March 2023, totaling about 1,700 units.
“There’s just over double the launch activity when you compare 2024 to 2023. That's quite interesting to me because it signals a bit more optimism,” MacDonald said.
Forty-two per cent of the 590 presale units on sale across Metro Vancouver and the Fraser Valley in February have been sold. Garde said that this percentage will decrease by five to 10 percentage points in March due to the increasing number of units coming onto the market.
“Not to say that the absolute number of sales will be less, but it's the percentage based on how much new supply is coming online,” he said.
While interest rates have a sizable impact on potential homebuyers, the presale buyer is slightly less sensitive, according to Macdonald. This is because a buyer doesn’t have to trigger a mortgage until the project is completed.
“If they're buying a presale project today, the interest rate that actually matters to them is the interest rate that is going to be applicable in 2026 or 2027,” he said.
“You’re buying essentially an idea versus a completed asset.”
When it comes to pricing, Macdonald said the presale market is still recalibrating.
“There's a lot of nervousness from our development partners and our clients around what the market price is,” he said, adding that this can vary depending on where the project is located, whether it’s concrete or wood frame and the number of bedrooms.
“I would say that the presale market in many aspects is in what I would call price discovery mode, where there aren’t enough transactions for people to feel really confident about how much a certain unit type is worth.”
