Sales absorptions for pre-sales in Greater Vancouver are expected to slow slightly over the next quarter compared to record sales rates in the past 18 months, but demand for new homes is still high, according to MLA Canada.
“Vancouver’s pre-sale market over the last 18 months has been extremely active with heightened interest in new projects that have seen high absorption rates,” explains Cameron McNeill, executive director of MLA Canada. “With ongoing housing policy changes from government along with stricter borrowing regulations and two Bank of Canada rate increases last year, home seekers are reviewing their homebuying plan more closely. In the next few months, we expect steady interest in the pre-sale market, just at a less frenzied pace.”
Strong demand for pre-sale
According to a new report by MLA Canada, approximately 70 per cent of new condominiums and townhomes that launched in February sold (about 1,280 homes out of 1,826 pre-sale units), and in March 60 per cent of the 1,572 new units sold. The April forecast called for 1,099 new pre-sale units, which is trending lower than this past February and March.
But don’t let the numbers cause confusion – there is still a strong demand for pre-sale, just at a steadier pace. “Pre-sale will continue to have a strong demand, especially for entry-level homes from both homebuyers and investors,” says McNeill. “Typical peaks in the real estate market for transactions are in the spring and fall as people prefer moving in before the summer/holidays. We are anticipating more units to be released in the upcoming months.”
McNeill says that appealing projects in key communities with easy access to transit and nearby amenities will continue to be popular spots for homebuyers. “Developers and architects are designing more efficient floorplans to accommodate various buyers, including downsizers, families and first-time homebuyers,” McNeill says. “We’re seeing an increase in home options for one, two-, three- and even four-bedroom plans.”
As for single-family homes, McNeill says prices have increased significantly. And although sales for single-family homes in west Vancouver have slowed slightly, McNeill says detached homes are still desirable. He adds that it may take longer to sell but “this is a more normal and expected pace for detached homes sales.”
What does this mean for homebuyers?
• Register early to receive the latest project information. “You may also have the advantage of finding out about events and early previews at the presentation centres,” McNeill points out.
• Research neighbourhoods and home amenities to find a community that fits your lifestyle. McNeill says, “Home prices for multi-family developments in Vancouver and the surrounding regions are seeing record price per sq. ft., leading some home seekers to re-evaluate their neighbourhood choices to meet their budget yet secure their investment.”
• Consider working with a realtor. McNeill explains, “It’s a great idea to work with a realtor to walk you through the homebuying process.”
• Have financing ready. “New developments continue to gain in popularity and homebuyers should have financing in place so they can act quickly when a pre-sale opportunity arises,” McNeill suggests.
To see the full report, visit bit.ly/MLA_april2018report