Tri-City expected to remain seller’s market in 2021, prices to increase between 0 and 5%
Tri-City real estate is expected to continue as a seller’s market in 2021, with lower supply anticipated as high demand continues to drive market activity. The average selling price in Tri-City increased 6% to $1,079,535 in 2020 (Jan. 1 – Oct. 31) compared to $1,022,790 in 2019 (Jan. 1 – Dec. 31). The RE/MAX Outlook for Tri-City real estate in 2021 is an increase of between 0 and 5% to approximately $1,133,511.11.
Who’s Driving Demand for Tri-City Real Estate?
Move-over buyers are currently driving demand in the Tri-City real estate market, as Vancouver buyers are seeking to leave the downtown core and live in a suburban area. This is expected to continue into 2021. The most sought-after property type in Tri-City are single-family homes.
First-time homebuyers in Tri-City are typically young couples looking for condominiums ranging from approximately $650,000 to $750,000. These price points are not expected to change moving into 2021 as potential first-time homebuyers will have increased problems qualifying for higher purchase price numbers. It is not expected to be easier for first-time homebuyers to enter the market in 2021 due to job stability uncertainties. First-time homebuyers have also shown hesitation in purchasing due to concerns regarding jobs, the economy, and they are hoping that prices will drop.
The move-over buyer market in Tri-City is driven primarily by families. There has been little hesitation in move-over buyers as they are more established in the workplace and have greater job stability. Move-over buyers have been less likely to need to live close to work and they realize that they need more space to work from home.
The condominium market in Tri-City is currently driven mostly by single homebuyers. The average sale price for condominiums in 2020 was $638,972. Condo activity is down due to ongoing issues with strata insurance, increased maintenance fees due to strata insurance and qualifying for financing due to both of these issues. Selling tenant occupied properties during COVID-19 has been an issue due to uncontrollable changes to the Residential Tenancy Act. This is expected to continue through 2021 until COVID-19 passes.
The luxury market in Tri-City has been driven primarily by foreign buyers who have already established themselves in Canada and are moving from other provinces. The typical starting price for a luxury home in Tri-City is $3,000,000. COVID-19 has limited the luxury market due to borders being closed, which has made it difficult for the luxury market money to come in from other countries. The demand for luxury homes has increased as our travel restrictions have adjusted.
Tri-City’s Hottest Neighbourhoods
Tri-City’s top selling neighbourhoods in 2020 were Pitt Meadows, Ladner and Maple Ridge. These neighbourhoods are sought after due to their affordability, suburban location and the fact that they often offer larger properties with more outdoor green spaces. These neighbourhoods are expected to remain popular in 2021.
Tri-City New-Home Construction
Tri-City’s new-home construction market has slowed. It has seen more buyer incentives being offered by the developers and decreases in pricing. The current number of homes being build is sufficient for the current demand, as it is allowing the market to catch up with the previous over supply. The new-home construction prices are typically higher than the prices of resale properties. Many developers have pulled back from starting new projects and are delaying the release of those projects due to COVID-19.
Canadian Housing Market in 2021
Canadians are on the move. RE/MAX isn’t calling this an “exodus,” but the re-location trend across the Canadian housing market is real, and it’s just one focus of the RE/MAX 2021 Housing Market Outlook Report. RE/MAX Canada anticipates healthy housing price growth at the national level, with move-up and move-over buyers continuing to drive activity in many regions across the Canadian housing market. An ongoing and widespread housing supply shortage is likely to continue, presenting challenges for homebuyers and putting upward pressure on prices.
Due to these factors, the 2021 RE/MAX 2021 outlook for average residential prices is an estimate of +4% to +6% nation-wide. Here’s the regional break-down:
Additional report findings include:
- 35% of RE/MAX brokers indicate that “move-over” buyers from other cities and provinces will continue to spark market activity in 2021
- 45% of RE/MAX brokers indicate that move-up buyers will likely be a primary driver of the housing market demand in 2021
- Half of Canadians (53%) are confident that Canada’s housing markets will remain steady in 2021
- 52% of Canadians believe real estate will remain one of the best investment options in 2021
“Despite the tragic impacts of the pandemic, our optimism in the strength of Canada’s housing market has always remained,” says Elton Ash, Regional Executive Vice President, RE/MAX of Western Canada. “While we’ve seen a significant shift in buyer preferences this year, we believe factors such as the supply issue, pent-up demand and historically lower interest rates will continue to fuel activity in 2021.”
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