- What Vancouver apartment transactions are on track to surpass last year’s total as volume edged up last quarter
- Why Changes to the capital gains tax and provincial housing incentives contributed to the increase
- What next The trend, plus lowered interest rates, hints at confidence returning to the market
Multifamily property sales in Metro Vancouver and Greater Victoria edged up last quarter, with volume totaling $830m via 61 deals year to date, according to a mid-year market report from CBRE.
Transaction activity is on pace to surpass 2023, which tallied $1.24bn of sales through 87 deals.
The figures indicate increased confidence in the market, said Greg Ambrose, vice president of CBRE Vancouver. He predicts the trend will continue.
“Multifamily fundamentals aren’t going anywhere,” Ambrose told Green Street News. “We’ve got huge immigration numbers. We have a housing crisis. We’re not fixing that anytime soon.”
CBRE said the strong start to the year comes amid political changes at the federal and provincial levels, highlighting the BC Rental Protection Fund.
The vehicle aims to acquire more than 2,000 homes in the coming year and, according to the brokerage, has closed on nearly 700 units so far. Those transactions represented $233m of activity in the region.
Changes to the capital gains tax also help push sales figures up, as sellers rushed to close deals before the effective date of June 25. The changes increased the inclusion rate to two thirds from one half for corporations, trusts and individual gains.
Of the 61 apartment-property sales so far this year, 29 closed in June, CBRE said.
Meanwhile, even as capitalization rates have inched higher recently, reduced inflation and interest rates have spurred the recent confidence in the market.
“Investment activity is expected to increase in Vancouver and Victoria where asset class fundamentals lead the country and sidelined Capital is expected to target the resilient landscape of Western Canada’s multi-family sector,” CBRE said.
CBRE said apartment rental rates across Canada have increased, hitting a new high of $2,202 average in May.
Rates in Vancouver are the highest in the country at $3,008.
