Presale launches in Metro Vancouver and the Fraser Valley have seen consecutive increases for three months in a row.
MLA Canada reported that in January, three presale projects were launched, followed by six more in February, totaling 1,024 units. The firm anticipates the introduction of 14 projects this month, with an estimated total of 2,150 units, bringing the total number of projects since the beginning of 2024 to 23.
Source: MLA Canada
Garde MacDonald, Director of Advisory at MLA Canada, highlighted the significance of spring for selling projects, attributing it to better weather and a more positive outlook compared to the previous year’s market conditions.
Between January and March 2023, a total of ten projects were launched, comprising approximately 1,700 units. MacDonald noted that the comparison of launch activities in 2024 and 2023 signals a notable increase in optimism.
In February, 42% of the 590 presale units available in Metro Vancouver and the Fraser Valley were sold. MacDonald expects this percentage to decrease by five to ten points in March due to the increased number of units entering the market.
While interest rates significantly influence potential homebuyers, presale buyers are slightly less sensitive, as they don’t need to secure a mortgage until the project is completed.
Regarding pricing, MacDonald mentioned ongoing recalibration in the presale market, driven by factors such as location, building type, and the number of bedrooms. He described the market as being in a phase of “price discovery,” lacking sufficient transactions for confident valuation.
February witnessed a rebound in real estate markets throughout Greater Vancouver, the Fraser Valley, and Victoria, characterized by consecutive months of sales growth.
Despite challenges in meeting the 10-year seasonal average, signs of a cautious market emerged as sellers became more active, resulting in a transition towards seller’s markets and higher sales-to-listings ratios. While price trends varied, all three regions showed positive momentum, suggesting a more optimistic outlook as they enter the Spring market.
GREATER VANCOUVER SEES CONTINUED SIGNS OF RECOVERY
The sales momentum observed in January extended into February, marking a second consecutive month of growth with a total of 2,070 sales recorded. Despite this positive trend, activity remains 23.3% below the 10-year seasonal average of 2,699 for February.
While sales activity trailed behind the seasonal average, there was a notable increase in new listings, aligning with typical averages and signaling a revival in seller participation. New listings rose by 34.6% month-over-month, totaling 4,560, resulting in 9,634 active listings for February.
With the increase in listings, the market has shifted from balanced to a seller’s market as demand matches supply. The sales-to-listings ratio sits at 22.4% across all product types, further highlighted by ratios of 31.3% for townhomes and 25.9% for condominiums.
The MLS® HPI composite benchmark price for all residential properties in Greater Vancouver is currently at $1,183,000, reflecting a 1.9% month-over-month increase. However, the benchmark price remains 6.3% below peak values observed in April 2022.
Greater Vancouver SALES TO LISTING RATIO. Source: MLA Canada
FRASER VALLEY MARKET SHOWS STEADY GROWTH
February witnessed continued upward momentum in overall sales activity within the Fraser Valley resale market, though still falling below long-term averages. Despite some buyers returning to the market amid promising inflation data and expectations of interest rate cuts, activity remains subdued compared to typical years.
The Fraser Valley recorded a total of 1,235 sales in February, marking a 32% increase from January but remaining 21% below the 10-year average. While this uptick is significant month-over-month, it largely reflects seasonal trends as the Spring market gains traction. Additionally, the region saw 5,561 active listings in February, up 14% from the previous month and 26% from February 2023.
The market has transitioned from a balanced state in winter to a seller’s market, evident in February’s sales-to-listings ratio of 22%. Moreover, average days-on-market (DOM) decreased from 28 days in January to just 13 days in February, indicating growing market optimism as listed properties transact more swiftly.
The MLS® HPI composite benchmark experienced a 0.9% month-to-month increase from January, reaching $994,600, breaking a six-month streak of price declines. Year-over-year values in the region are up by 4.8%, yet they remain 16.9% below the market’s peak in March 2022.
Fraser Valley SALES TO LISTING RATIO. Source: MLA Canada
STABLE HOME VALUES IN VICTORIA AS SPRING APPROACHES
February 2024 saw a notable increase in sales activity for the Victoria Real Estate Board, with a surge of over 38% compared to the previous month. Despite this uptick, activity remained consistent with levels observed a year earlier, totaling 470 transactions. Active listings also experienced a substantial 30.7% rise from February 2023, reaching a total of 2,364. Consequently, the sales-to-listings ratio shifted from a buyer’s market territory of 11% in January to nearing a seller’s market at 20% in February.
In terms of benchmark values, condominiums in the Victoria Core recorded a slight month-over-month decline of 0.4%, with a benchmark value of $557,000 in February 2024. Although condominium values have seen recent declines, they remain up by 1.4% year-over-year. Overall, the Victoria resale market demonstrates relative stability, with positive momentum leading into the Spring market.
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