THE FIFTH DIMENSION WINTER 2022 EDITION

We are pleased to present this Winter edition of the Fifth Dimension. This edition highlights the all-time record-setting Fourth Quarter and overall year that was 2021.

Fifth Avenue Real Estate Marketing Limited and Vancouver-based Baker West Real Estate Incorporated, are an integral part of an ever-growing ecosystem of premium real estate services companies operating throughout North America. Our related entities in BC include Okanagan-based EPIC Real Estate Solutions Incorporated and Vancouver Island’s The Condo Group Limited. Together in 2021, over 2,000 homes were sold and approximately $1,500,000,000 in sales revenue was generated for our developer partner clients.

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.

Stop the digital presses! 2021 was a record year for the new multifamily development industry in Metro Vancouver. It is safe to say that one year ago, few in our collective fold would have projected an all-time record high for sales. In 2021, 26,291 new multifamily homes were absorbed with a history setting quarterly sales mark of 7,655 in the Fourth Quarter driving the overall above the previous all-time high by 10+ percent.

Metro Vancouver development sales have accelerated, however, it is still not enough supply. Rising demand in Metro Vancouver is guiding developers to continue to market new multifamily projects at an accelerated pace heading into 2022. This continues to give prospective buyers who continue to be priced out of the re-sale and single-family home market, an opportunity to buy a home.

It is of interest to note, that there are an expected 23,000 new homes set to start construction in 2022 however, most of these are sold already. Furthermore, the BC Real Estate Association reports that 2022 started with the lowest number of homes for sale in the market.

Local appetite plus projected rising immigration levels means the demand for homes in Metro Vancouver are certain to once again outweigh the supply in the region for both pre-sale and pre-owned markets. Given strong demand and very low active listings, prices are also forecasted to rise about three percent in 2022. 

On the heels of record levels of new and pre-owned housing sales last year, BC’s residential real estate market is poised for more of the same in 2022. While not likely as astounding as 2021, this year will prove to be a strong year for home sales in BC.

In Metro Vancouver and other communities around the province, demand to buy a home remains at a record high. Meanwhile, inventory and listings available are low. If we add rising construction prices and supply-chain challenges, signs are pointing to higher housing prices in 2022. Therefore, in the coming months, one can expect exacerbated affordability challenges brought on by inflation and continued escalating prices in the face of constrained multifamily supply. Recent BC Assessment figures show that Condominium home valuations on Vancouver Island, Kamloops and other secondary markets, are rising quickly while remaining a value play for post-urban buyers. Clearly, there are shifts taking place in BC’s housing market that are influencing where people are purchasing homes as well as the types of homes they need and want. These changes are guided and complicated by the ongoing pandemic and we will increasingly see demand rise for new multifamily projects in emerging centres such as Kelowna, Kamloops, Langford and Penticton. The effects will also be felt in smaller or suburban Metro Vancouver communities as buyers embrace remote working and opt to leave behind bid frenzies in the expensive central urban re-sale markets.

Given this reality, more British Columbians are projected to continue to abandon the big city life in favour of more affordable locales while maintaining their big-city jobs. Smaller cities throughout BC, are certainly capitalizing on shifting buying habits. Therefore, heading into 2022 we can expect more investors and developers of new multifamily projects to secure sites and projects in these areas, bringing newfound growth and economic vitality.

As young people continue this regional shift and seek to put down roots in communities outside of Metro Vancouver, we will also see those communities benefit from new spending, creativity, investment, and business creation in the coming months and years.

Despite the obstacles presented by the ongoing saga of the pandemic, and in concert with the lack of supply combined with rising costs, further upward pricing pressure is to be expected. Meanwhile, there is a continuing desire for young professionals and young families to put down roots outside of Metro Vancouver, and those communities are eager to meet their needs. That is not necessarily a bad thing given the chronic lack of supply and cost escalation in Metro Vancouver amplified by projected population growth.

Click here to Download the Fifth Dimension Report, a Comprehensive Analysis of the Multi-Family New Home Market throughout Metro Vancouver & the Fraser Valley