September 2022 Pre-Sale Real Estate Market Insights
THIS EPISODE IS NOW AVAILABLE IN AUDIO
In our October 2022 episode of the Fraser Valley Presale Pulse, President of MLA Canada, Ryan Lalonde, and Managing Director for the Fraser Valley, Brittany Reimer dive into the latest pre-sale and resale data that are affecting the real estate market today.
DEMAND FOR QUALITY HOMES REMAINS STRONG IN THE FRASER VALLEY
There has been a slowdown in activity in the presale market, but like what we’ve seen in the resale market, there is still demand for quality homes. Buyers have become more selective, prioritizing homes with great location, good specs, and a price point that fits their current capabilities with the rising interest rates. The projects that have launched and been successful are the ones that have been able to create added value for home buyers through both the product and/or incentives offered.
It has been quite some time since buyers could weigh their options without the fear of losing out on a potential home. It is important to note that although we have seen softening in the market, it is magnified due to the blazing hot market we were experiencing leading up to our current conditions. Value seems to be a hot topic these days, we’re seeing White Rock’s best value, Coquitlam’s best value, Surrey’s best value, all meaning very different things in terms of the definition of value. Of course the point is what buyers are making purchase decisions on.
There were a few notable projects creating buzz in the Fraser Valley in September. Core by Westland Living will be erecting a 49-storey tower just steps away from Surrey Central Sky Train station. With a total of 429 units, Core will be comprised of units ranging from studios- to 4- bedrooms and will include over 150,000 sq ft of prime commercial space. The program is actively marketing and is preparing for an October launch.
Additionally, Piano by Concord Pacific and Parkway by BlueSky Properties have sparked buyer interest in the Surrey City Centre area. The market has been patiently waiting for Piano to be released, especially given the amount of marketing, realtor previews, and suite requests they have made over the months. We anticipate a Fall launch but it would be pushed into early Spring. Parkway by BlueSky Properties has had great success since releasing earlier this year – with almost 90% of released inventory spoken for. Building two has yet to officially announce when sales will begin.
SALES TO LISTING RATIOS
Resale activity in September compressed from the summer months – declining 12% from where we were in August. This primarily came from detached and townhome products which declined between 10-16%. Investors, who were primary purchasers in 2021, have mostly taken pause in Fraser Valley’s resale market leading to declining sales demand across the whole. Realistically, we’re not likely to see resale activity boom again until Spring 2023.
Since September 2020 benchmark pricing has increased 38% and resales in 2021 were 16% above the previous all-time-high in 2016. Given the growth we’ve seen over this period, it makes sense that, with headwinds now testing the market, buyers are choosing to ‘wait and see’ how the market will level out. While rising rates will impact resale product in the Fraser Valley over the near-term, increasing connectivity to transit, immigration, and relative affordability will continue to support values within the market over the long run. Touching on supply, active listings have increased 52.3% year-over year and stayed relatively level month-over-month. Over the long run, this supply is going to help support balanced, less volatile market activity.
For the latest real estate market data on Greater Vancouver, watch the latest video featuring Ryan Lalonde and Suzana Goncalves.
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