Where to buy real estate in Canada 2021: Metro Vancouver

Nestled at the foot of the Canadian Rockies and flanked by the Pacific Ocean is one of the most scenic metropolitan areas in the world: Metro Vancouver. With stunning mountain views and enviable beaches, it’s British Columbia’s most populous region and a highly desirable place to put down stakes. Frequently ranked high on global “most liveable” lists, the area also boasts comparatively low crime rates and a strong economy, along with quality healthcare and educational institutions.

Metro Vancouver spans from Horseshoe Bay on the U.S.-Canada border to the south, all the way to the municipality of Hope in the northeast of the Fraser Valley, and is home to 2,436,431 people. For context, this makes up about 60% of British Columbia’s population, spread among 21 municipalities, one electoral area, and one Treaty First Nation. The largest of these municipalities is Vancouver, the area’s major city, and the economic powerhouse for both the region and the province. Metro Vancouver includes:

• City of Vancouver
• Surrey
• Burnaby
• Richmond
• Coquitlam
• Township of Langley
• Delta
• District of North Vancouver
• Maple Ridge
• New Westminster
• Port Coquitlam
• City of North Vancouver
• West Vancouver
• Port Moody
• City of Langley
• White Rock
• Pitt Meadows
• Electoral Area A
• Bowen Island
• Anmore
• Lions Bay
• Tsawwassen
• Belcarra

The area is also Canada’s gateway to the Pacific Rim and trade with Asia, making it a natural hub for immigration. As a result, the region’s population is growing at a rapid pace, projected to reach 3.6 million people by 2050. Currently 43% of the population are immigrants, and foreign students flock to the region for its highly-ranked universities and other post-secondary institutions.

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Why we’re watching Metro Vancouver

Metro Vancouver has the fastest pace of economic growth in the nation, increasing 3.9% between 2013 to 2017, led by the finance, insurance and real estate sectors. In 2017, the area had a GDP of $136.6 billion, accounting for 61% of the entire province, and the third-largest in all of Canada. Unemployment rates vary across Metro Vancouver’s municipalities, but are generally lower than the Canadian average of 8.7%, coming in at 5.6% in the City of Vancouver, and at 5.8% in Victoria.

Retail, healthcare, tech, education, food and manufacturing are the top job sectors in Metro Vancouver, and a number of large companies including Amazon, Telus and Best Buy have their Canadian headquarters there. Tourism also contributes $14 billion annually to the economy, with 11 million people visiting each year to enjoy world-class skiing, oceanfront beaches and rainforests, as well as shopping, dining and entertainment. 

Major institutions in the region include Port of Vancouver, University of British Columbia, Simon Fraser University, British Columbia Institute of Technology and Emily Carr University. It’s also home to Vancouver International Airport, ranked the best airport in North America for 11 years running.

Those looking to call Metro Vancouver home will have a variety of communities to choose from, each suited to a unique lifestyle. Those looking to call Metro Vancouver home will have a variety of communities to choose from, each suited to a unique lifestyle, including the relaxed ocean-side communities of Tsawassen, the ski hills and hiking trails of North Vancouver, and the peaceful suburban enclaves found in Burnaby.

But, as idyllic as Vancouver living is, it comes at a cost: The City of Vancouver has the distinction of being the priciest real estate market in Canada, as well as among global cities. While this is due in part to its high immigration rate, the region faces unique geographical limitations; bordered by both mountains and the ocean, development cannot sprawl out to meet increased demands. The benchmark price for all home types in the region was $1,123,300 in March 2021, according to the Real Estate Board of Greater Vancouver (REBGV), an increase of 9.4% year over year.

Pre-COVID real estate market

Historically, the Metro Vancouver real estate market has grappled with a supply-demand imbalance, putting upward pressure on prices. However, recently the region has put a number of provincial and federal policies in place that have been designed to cool the market, such as a 15% foreign buyers’ tax, out-of-province speculation tax, empty homes tax, and federal mortgage stress test. These measures proved effective: sales were down by 30% in April 2019, while listings rose by more than 45%.

Impact of the COVID-19 pandemic

There’s evidence this correction was starting to unwind just as the first lockdown came into effect. The February 2020 data from the Real Estate Board of Greater Vancouver (REBGV) revealed 2,150 transactions, up 44.9% annually, and up 36.9% from January. New listings were up 2.8% year over year with 4,002 coming to market in anticipation of the upcoming spring selling season; however, total inventory remained 20.7% below the previous year’s levels, indicating supply issues were creeping up yet again.

March 2020 numbers reveal the busiest weeks of the year for the region, with sales up 46%, though REBGV acknowledged activity was concentrated in the first half of the month. By April 2020, both buyers and sellers had shied away with sales and listings plunging 39.4% and 59.7% year over year, respectively. The benchmark price saw modest growth of 2.5%.

As the real estate industry was named as an essential service, agents in Metro Vancouver were quick to adapt to social distancing limitations. The activity was still below year-over-year levels in May, but had bounced back to seasonally-typical levels by June; sales rose 17.6% annually and 64.5% month over month with 2,443 transactions, while new listings rose by 21.8%. The benchmark price rose 3.5% to $1,025,300.

Future outlook

The market has been steadily picking up steam since its June 2020 rebound and is now reaching historically busy levels. The number of sales more than doubled for all home types across the region with 5,703 transactions, an unprecedented increase of 126.1% year over year, and up 53.2% from February. For context, that’s 72.2% above the 10-year March average. The benchmark price is up 9.4% across all home types to $1,123,300.

Double-digit price gains are seen in the single-family and townhouse home types, too. In keeping with other large markets across Canada, suburban and rural markets have seen an enormous increase in interest since more buyers have flexibility when it comes to location. 

“Demand for outdoor space seems to really be driving the market,” says local real estate agent Casey Archibald. “Condos with oversized patios, townhomes with rooftops or yards, and, of course, detached houses with good lots have outperformed the rest of the market.”

“The condo and townhome market really took off in the first quarter, especially in the Tri-Cities [Coquitlam, Port Coquitlam, Port Moody], Maple Ridge, and Langley,” says Archibald. “We saw prices absolutely skyrocket. Ten-plus offers for townhomes in these areas became the norm, hitting record prices every week.”

Supply is growing too, up by a whopping 86.8% with 8,287 homes brought to market from March 2020, and up 64.2% from February. However, even with this increase, there hasn’t been enough to make a dent in the demand, and the market remains as unbalanced as ever. Buyer fatigue from stiff sellers’ market conditions won’t be too far off, Archibald says.

“We’re still seeing some huge sales numbers when listings get multiple offers, but over the past month, we’re seeing the emergence of sellers holding off for offers on a certain day and then be left with nothing,” Archibald says. “This speaks to buyer fatigue, but also that these price increases likely can’t be sustained forever.”

Certain properties have are most desirable than others, too. “Listings that show well are in family-friendly areas and are well-priced are still doing extremely well,” Archibald says. “It’s the listings that are priced slightly high or have a few drawbacks that are not selling like they would have a couple of months ago.”

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