A limited supply of new-build townhome inventory has left Victorians scrambling to secure what has become an in-vogue housing option in the Capital Region.

 

Dominated by high-density condominiums and low-density suburban single-family-dwellings, Victoria’s new-build housing efforts are overwhelmingly focused on supplying opposite ends of the market spectrum, leaving townhomes – a middle ground of the industry with less than 10% of total sales – in short supply.

 

“Over the last two years we’ve seen a real spike in demand for rowhouse-style units,” says Joe Sopp of Le Fevre and Company, the developer of Vic West’s Railyards community.

 

“Couples outgrowning a traditional condo and downsizers eager for more space than what a one or two-bedroom condo may accommodate are increasingly attracted to product like the Railyard’s Sky Homes, and with opportunities to buy this form of housing being as limited as it is, demand is only fuelled.”

 

Sopp says the primary reason for the market’s focus on high-density suites or low-density subdivisions, with relatively few options in between, is a housing market geared towards maximizing density on developable land and supplying the strong desire for a home-and-yard. 

 

“Given today’s high cost of land, developers are working to ensure unit pricing remains attainable for as many buyers as possible, which gives rise to higher density in lieu of lower density projects like townhomes. And in the suburbs you have buyers looking for detached homes and land, so even on the Westshore options remain limited.”

 

The Railyards, situated at the nexus of Tyee Road, Bay Street and Skinner Street along Vic West’s harbourfront, is one of only a handful of new-build housing communities offering the opportunity to purchase an urban townhome. And the market response to the project’s six available “Sky Homes,” priced from $735,000, has been strong, Sopp says.

 

“Buyers recognize the value in both the price-point of an urban townhome and the overall benefit of urban living. Value and location have always been synonymous with The Railyards, and with the market facing an inventory undersupply, coupled with quickly rising prices, we are definitely seeing a trend where would-be detached housing buyers are looking to product like our Sky Homes for their next purchase.”

 

Victoria REALTOR® Mike Janes, a real-estate advisor with Engel & Völkers, confirms that a growing number of Victorians who until recently had their sights set on a detached home are now realizing that townhomes are their only option for a larger residence in the city.

 

“There are a lot of buyers who have been completely pushed out of the single-family-home market and they’re looking at townhomes as their remaining option,” Janes says. “And the fact that these units represent the tightest market within a tight market means prices will continue to face upwards pressure.”

 

According to data compiled by Citified, approximately 100 townhomes are under construction throughout the region. Compared to 1,200 condominiums, 1,600 purpose-built rental homes, and some 1,000 detached homes underway or nearing construction, the share is minute. And their availability in the urban core of the region drops even further with a nearly single-digit available supply, something Janes says speaks to the immediacy he and his colleagues have sensed since the beginning of the year.

 

“The time to buy townhomes, literally, is now. And since we’re not seeing much inventory materializing in or near downtown Victoria, what remains at a porject like The Railyards is that rare opportunity to lock in a purchase at an attainable price.” C