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Vancouver's red-hot housing market — which offers the most expensive real estate in Canada — is continuing to drive commercial investment across the board. According to new numbers released by Altus Group, a leading provider of real estate services, software, and data solutions, a total of $2.8 billion CAD worth of asset sale transactions took place in Q3 2016. While that represents a 26 percent drop from the previous record-breaking quarter, it was still the second highest quarter recorded by Altus Group.
The $2.8 billion figure includes 685 sales transactions of over $1 million. The Industrial, Commercial, and Institutional (ICI) Land and Residential Land sectors comprised 65 percent of all investment in the third quarter. The resilient Residential Land market contributed $1.26 billion alone, representing 45 percent of the total quarterly investment volume of $2.8 billion. Residential Land and long-term residential redevelopment sites held seven of the top ten transactions; five of those took place on the intensifying downtown peninsula.
"While transactions of improved assets remain relatively healthy across each sector, the land markets continue to be the key market driver," said Paul Richter, Director at Altus Data Solutions Canada, Altus Group. "The Residential Land market in particular is now into its fourth quarter of exceptional performance, driven by immediate and long-term redevelopment opportunities in high-profile neighbourhoods."
The data for the final quarter would present a fuller picture that reflects the reality of Vancouver's new 15 percent tax on foreign buyers. Vancouver home sales have slumped significantly since the tax took effect in August. September sales were down 33 percent compared to the same month in 2015. The City of Vancouver has also recently approved a one percent tax on the assessed value of empty homes, hoping to curb the number of languishing vacant houses owned by property speculators.
