The Lower Mainland real estate market delivered mixed results in the first quarter of 2023, according to a new update from MLA Canada.
“Compared to [2022], we're definitely still on the lighter side but we're actually at a really solid pace,” said Suzana Goncalves, executive vice-president of sales and marketing at the real estate agency. “What we have right now is a bit more sustainable and it's good, solid activity without as much overheating as we've seen in the past.”
Activity and inventory are on the low side for the region’s real estate markets, with the May 8 report characterizing presale units as having a steadier pace of activity and sales compared with the resale market.
That said, Metro Vancouver and Fraser Valley’s presale market still posted lower sales in the first quarter of the year when compared to 2022’s booming market.
But Burnaby and west Coquitlam were two markets with notable activity, with both areas having multiple projects with a “steady pace of sales month-over-month,” Goncalves said.
“When you've got more than one project selling at a time in a neighborhood, that tends to naturally attract more people and they shop around. We've definitely seen the benefits in those two neighbourhoods of so much activity, people being interested in those markets, doing their due diligence and looking at what's out there. Then we've seen that translate into sales,” Goncalves said.
There were 14 project launches, resulting in the introduction of 1,661 units into the Metro Vancouver and Fraser Valley markets for the first quarter, according to MLA Canada’s May 8 update.
Roughly 43 per cent (711 units) have been sold, representing a year-over-year decline of 83 per cent.
The Alina by Strand development in west Coquitlam is over 90 per cent sold. Other notable projects in the region include Perla by Polygon Realty Ltd. and South Yards by Anthem Property Group in Burnaby.
Burnaby was the most active submarket for released inventory, with both presale programs recording same-quarter sales higher than the 43 per cent market average.
The Bank of Canada paused interest rate hikes at 4.5 per cent in March and forecast in April that inflation would cool to three per cent midway through 2023.
The expectation of lower mortgage rates in the coming year is encouraging buyers to re-enter the presale market and supporting sentiments that the presale market will remain steady for the rest of 2023, according to MLA Canada.
“People believe that in a year, or two or three, when their home is actually ready, that interest rates will be in a different place. So that's allowed us to keep trucking along at a bit more of a steady pace,” Goncalves said.
It is expected that more developers will gain confidence in the market and want to launch projects in the fall, bringing additional supply to the presale market, MLA Canada’s report stated.
