Vancouver Condo Report
Mid-Year Market Forecast
Latest Update: January 7, 2014
 

 
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Mid-2013 Forecast  - June, 2013

MLS High Rise Forecast
MLS Low Rise Forecast
MLS Townhouse Forecast

The quarterly migration figures for BC released last month show some improvements. Total net migration for the 1st quarter of 2013 was 8,144 persons; up from a loss of 1,504 persons in the 4th quarter of 2012 and up by almost 2,000 from the 1st quarter of 2012. The net interprovincial loss is down and net international migration is up from the same period in 2012. But a closer reading of the numbers shows that the gains in international migration are due to an increase in non permanent residents - students, temporary workers, nannies, maids, etc. The number of immigrants was actually down from previous quarters.

What this means for the Vancouver condo market is a continuation of the "new normal". No quick return to the go-go days of 2005-2007. But the on the bright side of an under performing MLS market is that there should be growing pent-up demand for resale apartment and townhouse condos.

MLS Apt & Townhouse Sales and Pop'n Trend

An analysis of the relationship between population in the prime home buying age group (25 to 64) and MLS condo and townhome sales shows that MLS sales of apartment and townhouse condos fell short of population-based sales estimates by 3,300 units in 2012 and will likely fall short by 4,800 units in 2013. Once the BC and Vancouver economy starts to improve and net interprovincial migration turns positive again, expect to see this pent-up demand released.

MLS High Rise Market Forecast

Mid-2013 high rise forecast

Strategics' previous forecast for the MLS high rise market was in January of this year. At that time it looked as if high rise sales in 2013 would be down by 25% from the previous year. After six months of sales, the sales forecast still shows a 25% drop in sales for 2013. Total high rise sales in 2013 are expected to be close to 2,800 units. MLS sales in April and May were higher than expected but total sales in June were down to 282 units.

The average selling price in June was $557,000 or $605 per square foot. Both figures are up from previous months. The average MLS selling price is expected to remain fairly flat in 2013 at around $518,000 per unit. The average selling price per square foot should slip a bit to around $561 per square foot.

Mid-Year Forecast Change 2012-2013 (Previous Forecast)
  High Rise 
Market Area Sales $/Sq.Ft
Downtown Vancouver -27% (-25%) -2% (-2%)
Westside Vancouver -16% (-28%) -7% (-7%)
Eastside Vancouver -19% (-20%) 0% (2% )
Burnaby -28% (-24%) -1% (0%)
New Westminster -37% (-27%) -7% (-2%)
Coquitlam-Port Moody-PoCo -17% (-23%) -5% (-2%)
Pitt Meadows-Maple Ridge - -
North Vancouver -22% (-17%) -2% (-1%)
Richmond -11% (-47%) -2% (-3%)
North Surrey -17% (-15%) -3% (-3%)
South Surrey-White Rock - -
Langley - -
     
Greater Vancouver -25% (-25%) -2% (-2%)

A comparison of the expected 2012 to 2013 changes in MLS high rise sales made six months ago to the current estimates shows a slight improvement in some markets. Although MLS high rise sales in 2013 are expect to be down from 2012 in all markets, the drop in sales in Westside Vancouver and Richmond are less than previously expected. The Richmond MLS market appears to have finally bottomed out.

Expectations for changes in price per square foot haven't changed much over the past six months. Overall, average MLS selling prices per square foot in 2013 are expected to be down by about 2% compared to 2012. The price decline in Westside Vancouver, New Westminster and Coquitlam-Port Moody-PoCo is expected to around 5% to 7%.

(For specific high rise markets see: Detailed Market Trends)

MLS Low Rise Market Forecast

Mid 2013 low rise forecast

Changes in the MLS low rise market over the past six months have left the mid-year forecast for overall sales and price per square foot pretty much as it was last January. MLS low rise sales in June were close to 370 units which was up slightly from the previous month and up by 27% compared to 12 months ago. Total MLS low rise sales in 2013 are expected to be just over 3,000 units, which is slightly better than the forecast made in January of this year.

Richmond is the only low rise market that is expected to show any positive gains in 2013 when compared to 2012. Richmond MLS low rise sales in 2013 are expect to be up by 21% or close to 400 units in 2013. The sales outlook for low rise condos has also improved in Westside and Eastside Vancouver and Burnaby but total sales in 2013 in these markets are still expected to be less than in 2012.

Mid-Year Forecast Change 2012-2013 (Previous Forecast)
  Low Rise 
Market Area Sales $/Sq.Ft
Downtown Vancouver - -
Westside Vancouver -12% (-31%) -5% (0%)
Eastside Vancouver -11% (-24%) -5% (-5%)
Burnaby -12% (-27%) -1% (-7%)
New Westminster -9% (-14%) -3% (-4%)
Coquitlam-Port Moody-PoCo -23% (-27%) -2% (-3%)
Pitt Meadows-Maple Ridge -14% (2%) 0% (5% )
North Vancouver -32% (-25%) -3% (-7%)
Richmond 21% (-43%) -3% (-5%)
North Surrey -24% (-33%) -1% (-5%)
South Surrey-White Rock -30% (-20%) -4% (-4%)
Langley -19% (-25%) -9% (-4%)
     
Greater Vancouver -24% (-27%) -3% (-3%)

The overall MLS selling price for low rise condos in June was $342,000 or $387 per square foot. This is up slightly from the previous month and up by 6% from 12 months ago. The trend for the overall selling price for low rise condos is still slightly positive but the average MLS price per square foot is expected to soften by about 2% in 2013. Buyer preference for resale low rise condos is shifting toward slightly larger units. The only major change over the past six months is in Langley where the average price per square foot is now expected to be down by 9% compared to the 2012 average price. This may be enough to stimulate MLS low rise sales in this market.

(For specific low rise markets see: Detailed Market Trends)

MLS Townhouse Market Forecast



Over the past six months, the outlook for MLS townhouse sales in 2013 has improved slightly. Overall townhouse sales are expected to be around 2,750; a 22% decline from 2012. The sales outlook has improved in Richmond, Langley, Westside Vancouver and North Vancouver but MLS sales in all townhome markets are still forecast to be less than sales in 2012.

Mid-Year Forecast Change 2012-2013 (Previous Forecast)
  Townhouse 
Market Area Sales $/Sq.Ft
Downtown Vancouver - -
Westside Vancouver -13% (-33%) -6% (-4%)
Eastside Vancouver - -
Burnaby -20% (-31%) 0% (-3%)
New Westminster - -
Coquitlam-Port Moody-PoCo -27% (27%)  -2% (1%) 
Pitt Meadows-Maple Ridge -30% (-46%) -3% (-3%)
North Vancouver -12% (24%) -1% (-2%)
Richmond -12% (-45%) -3% (-1%)
North Surrey -22% (-33%) -2% (0%)
South Surrey-White Rock -27% (-17%) -4% (0%)
Langley -15% (-33%) -2% (-2%)
     
Greater Vancouver -22% (-30%) 0% (1%)

The average MLS selling price for townhouse condos in June was $480,000 or $325 square foot. This is down slightly from the previous month and up by 4% compared to 12 months ago. The forecast change for the selling price per square foot for townhouses has changed little over the past six months. The average price per square foot and the overall average selling price are expected to change very little.