Metro Vancouver’s housing market is keeping up its momentum, despite a slight slowdown from last year’s unprecedented pace.

According to The Fifth Dimension Spring Edition 2022 report, sales activity in Q1 2022 was down from the same quarter last year, but still relatively high compared to historical trends, with a total of 6,323 homes sold in Q1 2022.

This is the second-highest Q1 sales volume ever recorded by Zonda Urban, an analytics firm that has been tracking home sales data for over a decade. 

Jamie Squires, President of Fifth Avenue Real Estate Marketing Ltd., helped put things into perspective. As quoted in the report, Squires explains, “what we are experiencing is comparable to driving at 140 km/hour and then slowing down for a curve in the road to 80 km/hour.” 

READ: The Fraser Valley Real Estate Market is Cooling, Here’s Why That’s Normal

Offering further context, Squires adds: “suddenly everything feels very slow even though you are still moving very fast.” 

Q1 sales were largely driven by high rise units, which saw a 35% increase in sales activity compared to the same quarter last year. In fact, high rise units accounted for 65% of overall sales in Q1 2022. 

According to Squires, this uptick in high rise sales was driven by two main factors. For starters, last quarter saw a surge in the category's inventory. Squires says, “when COVID-19 first came on in 2020, [developers] put their projects on hold while they figured out what the market was going to do.” 

“High rise supply that would have been there in late 2020 didn’t come to market until 2021, which gave the market more supply of high rise units.” 

The second reason for last quarter’s influx of high rise sales, according to Squires? Affordability. 

She explained, despite an overall slowdown in sales activity, home prices remained high because of rising inflation, coupled with increasing construction costs. 

This meant that many people were priced out of the single-family and townhome markets, which ultimately drove up demand for high rise units. 

When asked whether she predicts a price drop in the near future, Squires shares that she isn’t holding her breath. “I don’t think we’re going to see real price drops,” she explains. “Costs are escalating, inflation is rampant, and there’s nowhere for developers to cut costs.”

As prices remain steady, and with at least two more interest rate hikes expected by the end of the year, high rises are likely to remain the strongest of all home types sales throughout the rest of 2022.

Read The Fifth Dimension Spring Edition 2022 report in full here.

This article was produced in partnership with STOREYS Custom Studio.