Mid-Year Condo Market Forecast

There have been a few surprises in the MLS condo market over the past six months. For Greater Vancouver as a whole, MLS high rise sales and prices, as measured by changes in price per square foot, are higher than forecast six months ago and MLS low rise prices increased more than previously forecast. Overall townhouse sales and price expectations for the next six months are unchanged from six months ago although there are changes in individual markets.

None of the MLS condo markets are showing signs of over heating during the next six months. MLS figures are not showing any signs of a bubble in the condo market. It is more likely that any derailment of the condo market will be because of external shocks rather than unsustainable price increases or over production of new product.


High Rise Market Forecast 

 

First quarter MLS high rise sales were better than expected. As a result, total MLS high rise sales in 2011 are now expected to be 3% higher than in 2010. Six months ago, the forecast was for a 3% decline in sales.

The biggest percentage increases in MLS high rise sales are now forecast to be in Westside Vancouver and New Westminster. Westside Vancouver is forecast to increase by 10% and New Westminster by 12%. The biggest declines in MLS high rise sales are forecast to be in North Surrey - down 11%, and in the Coquitlam-Port Moody-PoCo market - down 8%.




The increase in first quarter MLS high rise sales was also accompanied by an increase in average selling price per square foot. The net effect is that the forecast price change in 2011 for MLS high rise condos is up from 1% to 5%. The only MLS high rise markets that are forecast to decline in price are Coquitlam-Port Moody-PoCo and North Vancouver. The average price per square foot is forecast to decline by 4% in the Tri-Cities area and by 1% in North Vancouver.

Forecast Change 2010-2011
	High Rise
Market Area	Sales	$/Sq.Ft
Downtown Vancouver	3%	6%
Westside Vancouver	10%	8%
Eastside Vancouver	-3%	3%
Burnaby	2%	4%
New Westminster	12%	5%
Coquitlam-Port Moody-PoCo	-8%	-4%
Pitt Meadows-Maple Ridge	-	-
North Vancouver	5%	-1%
Richmond	-2%	5%
North Surrey	-11%	5%
South Surrey-White Rock	-	-
Langley	-	-
Greater Vancouver	3%	5%

Low Rise Market Forecast



MLS low rise prices have done better than expected over the past six months, pushing the forecast change in average price per square foot from -1% to 4% for 2011. However, MLS low rise sales have not improved at all. The January forecast for 2011 was a 6% decline in overall sales. The mid-year forecast for 2011 is for a 5% decline.

MLS low rise sales in 2011 in North Surrey, a major low rise market, are forecast to decline by 11% when compared to 2010 sales. Low rise sales in Coquitlam-Port Moody-PoCo, another major low rise market, are forecast to decline by 7%. The only markets now forecast to have a modest increase in MLS low rise sales are Burnaby, Eastside Vancouver and North Vancouver.



The average price per square foot for MLS low rise sales in 2011 is expected to be about 4% higher than in 2010. The biggest increases are forecast to be in Eastside Vancouver (8%) and in Burnaby (7%). Westside Vancouver is expected to be down by about 1%; Pitt Meadows-Maple Ridge, down by 6%.

Forecast Change 2010-2011
	Low Rise
Market Area	Sales	$/Sq.Ft
Downtown Vancouver	-	-
Westside Vancouver	-4%	-1%
Eastside Vancouver	1%	8%
Burnaby	2%	7%
New Westminster	-16%	2%
Coquitlam-Port Moody-PoCo	-7%	4%
Pitt Meadows-Maple Ridge	-11%	-6%
North Vancouver	1%	2%
Richmond	-7%	4%
North Surrey	-7%	1%
South Surrey-White Rock	-11%	4%
Langley	-6%	3%
Greater Vancouver	-5%	4%

Townhouse Market Forecast



MLS sales of townhouse condos appears to have hit bottom this year. First quarter sales were up but total sales for 2011 are still expected to be 9% below 2010 figures. The mid-year MLS townhouse sales forecast is essentially unchanged from six months ago. A major drag on MLS townhouse sales is the North Surrey market. Sales in 2011 are expected to be 24% below 2010 sales.



An almost continuous increase in price per square foot since 2009 has also been a drag on sales. Over the past six months, the rate of increase has levelled off but the average price per square foot in 2011 is still forecast to be 4% higher than in 2010. The increases in Richmond and Westside Vancouver are expected to be well above average; 9% in Richmond and 7% in Westside Vancouver.

Forecast Change 2010-2011
	Townhouse
Market Area	Sales	$/Sq.Ft
Downtown Vancouver	-	-
Westside Vancouver	2%	7%
Eastside Vancouver	-	-
Burnaby	-10%	3%
New Westminster	-	-
Coquitlam-Port Moody-PoCo	-3%	5%
Pitt Meadows-Maple Ridge	-4%	3%
North Vancouver	-7%	1%
Richmond	-13%	9%
North Surrey	-24%	2%
South Surrey-White Rock	-2%	1%
Langley	-6%	-1%
Greater Vancouver	-9%	4%

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Detailed Market Trends

[Downtown High Rise    [Westside High Rise   [Eastside High Rise

[Burnaby High Rise      [New West High Rise    [Tri-Cities High Rise

[North Van High Rise    [Richmond High Rise     [North Surrey High Rise

[Westside Low Rise      [Eastside Low Rise       [Burnaby Low Rise

[New West Low Rise     [Tri-Cities Low Rise       [Maple Meadows Low Rise

[North Van Low Rise     [Richmond Low Rise     [North Surrey Low Rise

[South Surrey Low Rise     [Langley Low Rise     [Westside Townhouse

[Burnaby Townhouse     [Tri-Cities Townhouse     [Maple Meadows Townhouse

[North Van Townhouse     [Richmond Townhouse     [North Surrey Townhouse

[South Surrey Townhouse    [Langley Townhouse

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More detailed information on sales and price trends is available from Strategics for individual markets and sub-markets.  Contact Strategics for more information.

phone/fax  +1-604-608-3192 (voice mail)
email         strategics@vancouvercondoreport.ca
skype        frank.schliewinsky
mobile       +60-17-429-7064 /+66-81-080-5717