The Fifth Dimension Report - Summer 2023 Edition - Fifth Avenue REM mediaiqdigital tracking pixel
Market Intelligence, Peerage Partners, Real Estate News | August 25, 2023

With the summer season in full swing, it’s time to take a closer look at the data from the second quarter of 2023, alongside a concise summary of the completed second quarter in our Fifth Dimension Metro Vancouver & Fraser Valley report.

We start this summer edition of the Fifth Dimension grateful to those who courageously have been battling wildfires throughout BC and Canada. Our hearts ache for those who suffered a loss of home. Thank goodness there has been no loss of life in BC. We are also grateful that as of this week and based on discussions with our related Okanagan based company, EPIC Real Estate Solutions Inc., the situation is improving.

The dog days of summer are certainly upon us as consumers, realtors, and the industry as a whole continue to navigate the current rapids of one interest rate increase after another. Despite the expected rise in late summer, there is much discourse as to when this trend will begin to subside. At the same time, supply remains a recurrent theme falling on selectively muted ears. That being said, the Provincial Government has amped up an offence unveiling it’s ‘naughty’ cities list  thereby adding heat at the municipal level of government with respect to the inadvertent constraint of housing. More specifically, BC’s leadership has spotlighted 47 cities, however, the specifics of the spotlighting remain a mystery. Such vagueness underscores the view that the overall market roadmap is still strewn with uncertainties and challenges. It would appear that without advanced targeted action vs. policy, and given cost inflation, supply will remain restricted this fall and into 2024 compounding affordability challenges.

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.

 

Amidst this backdrop, the remaining chapters of the 2023 market story will soon be revealed.

In the 14 years we have been involved in this reporting exercise, the intricacies of these market shifts and the evolving definition of ‘affordability’ are noteworthy. It seems that affordability is at a cross road. The story seems less about what the average person can afford and how to deliver lower cost product. Instead, it is more increasingly about what added taxes and charges governments pile onto developers leaving the consumers facing added inflationary pressures across the province.

The specter of inflation casts a long shadow and as of this report, the recent rate hike has tempered inflation to 2.8 percent, a significant retreat from the 5 percent reported in our previous edition of the Fifth Dimension. The Bank of Canada (BOC) has it’s eyes set on a 2 percent inflation benchmark for 2024. Should they opt for another rate hike come September, this target might be within closer grasp than anticipated. By the close of the Fourth Quarter, we remain hopeful for a cessation in rate hikes and actual declines at some point in 2024.

As the summer passes and we head into the busy back to school season we wish everyone a healthy and happy conclusion to the year that is 2023.

Please feel free to reach out with any questions you may have or to discuss potential sites you may be considering preparing for the market. The earlier marketing is introduced into the project development process, the more we can help guide and ensure the correct overall unit mix to achieve maximum sales and revenue results for each pocket of the Fraser Valley.

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

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