Fast forward, skip ahead, or see into the future. If we could do this in business or real estate investing, all of us would be highly successful in timing the market and we would be winning big!
Let me give you a peek into the future when it comes to investing in real estate. Canada’s three largest cities, Montreal, Toronto, and Vancouver, will be seeing a great opportunity in 2023. In 2023, we expect that our borders will open to a record number of permanent residents. At this time, the pandemic would have shut down immigration for approximately 3 years, and the flood gates—the borders—appear to be ready to open.
The real estate market thrives on immigration, and it is seen as a safe haven or a sound investment for the financially strong immigrants. However, international buyers are mostly attracted to Canada for its lifestyle and culture. For example, Vancouver’s appeal is that it is surrounded by nature, Toronto is known for its diversity and culture, and Montreal attracts interest from French-speaking countries. People want to purchase property that is a sound investment, but also rivals the lifestyle they are familiar with in their home countries.
What about the immigrants that cannot afford real estate? They need a place to call home and this is where the Canadian investor wins. Here is your cue to prepare and invest in properties that will accommodate these new Canadian tenants. Not an investor? Well, you will win as well! All property owners will win, even in cities outside of the big three. This huge push of immigrants could be north of 600,000-750,000 people. Imagine having this many people landing in the big three cities and how it will cause a ripple effect to the surrounding cities and towns.
The pandemic has taught us the importance of home and space. During this time, many sought to improve their lifestyles, and Canadians have been the driving force behind the increase in most markets across the country. People have been willing to pay more to increase and elevate their living spaces, whether that is by upsizing, or by moving to a home that offers higher-quality design, finishes, and amenities. The low-interest rates and the extra savings that many Canadians were able to put away also fueled the market.
Fast forward, skip ahead, or see into the future. The best way to understand and put the future into perspective is to look back at the Fraser Valley numbers from a decade ago. The average sale price of all property types was roughly $500,000 and today it is north of a $1,000,000. A decade ago, the average sale price of a detached home in Abbotsford was roughly $425,000 and today it is more than $1,100,000. The average price of a townhome in Langley was approximately $320,000 and today it is $725,000. The average price of a condominium in Surrey Central was approximately $205,000 and today it is more than $425,000. The future real estate market is not crystal clear to me, but it is clear enough for me to encourage you to fast-forward your investment decisions when it comes to real estate.
It is more of the same when looking at the stats for the Fraser Valley and Vancouver real estate market. Depending on which side of the fence you are on, Seller or Buyer fence that is. The low inventory and extremely strong sales volume makes you smile as a seller or cringe as a buyer. Reviewing the STR (Sell Through Rate) numbers continue to show how strong the market is in most areas. The ultra-luxury market continues to struggle, but this is the norm for this sector of the market no matter what the balance of the market is doing. The cool morning air lets you know that fall is just around the corner, which means regular schedules of work and school are set to kick in. This also means I expect the fall real estate market to ramp up as well.
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