Quick Summary: We are encouraged by the number of showings but sales numbers are lower and prices continue to soften. Spring is always the busiest time in real estate, so we will have to wait to see if things improve when the weather breaks.
Hello everyone, welcome to March and hopefully spring arriving soon! …waiting patiently!! Time again already for my Monthly Market Update, a collection of statistics plus my opinion about the Victoria Real Estate market, which I provide as a courtesy to all my loyal clients and contacts.
Pricing and Activity: The core area (which takes in Victoria, Esquimalt, View Royal, Oak Bay and Saanich) is showing a very slight decrease of less than 1% year over year (.3% to be more precise). The benchmark price of a single family home in the core is $845,900, less than last month’s $847,800 and slightly less than last year’s $848,600. It’s in a declining pattern for several months now and this month barely tipping into the negative. Overall in our entire market area (which takes in the islands, Western communities and over the Malahat) it’s still showing a slight increase of about 1% year over year, standing at $739,500, lower than last month’s $742,000, which shows the declining pattern as well. Activity and pricing vary by area and also by type of property. There are more sales of single family homes than any other class so it best represents the activity.
The month of February came in at a total of 421 sales in Greater Victoria, more than January’s 329 (to be expected). Last year in February there were 545 sales, a significant difference. (Those statistics include all property types and all areas covered by the Victoria Real Estate Board.)
The Market: The many government taxes and policies are having the governments’ desired effect in softening the market, the national mortgage stress test likely having the most significant impact. There are several, including the Foreign Buyer Tax, Vacancy Tax, the Speculation (asset) Tax, and increased interest rates. It benefits some and hurts others, and, according to what I’ve recently read, along with other factors, is having some impact on the economy in the fourth quarter. We will have to wait to see what spring brings. I think we will see signs of the direction shortly, as soon as the weather breaks. Despite the many issues affecting our market, we still have very low inventory historically speaking, which typically should buoy prices. Overall there seems to be demand and interest though buyers are being careful, and some are waiting to see if prices will decrease further. As typically happens when the market softens, higher end homes are hit harder than lower priced ones, and this time with the mortgage stress test affecting mortgage approvals, lower priced homes are seeing decent activity.
Inventory is showing a total of 2,131 properties on the market at month end, a bit more than last month’s 2,057. Last year in February it was 1,545. That all means that inventory is still quite low historically speaking. In the last busy market of around 2006 inventory was in the 3,200 range, and in the slowest period of 2012 and 2013 it was over 5,000.
Interest rates A five year fixed term mortgage can be had for around 3.5% if you qualify, depending on your down payment, term, credit history, institution etc. If you’re thinking of moving, take the time to get preapproved before house hunting to make sure everything goes more smoothly.
About the Attached Graphs: Attached you will find a copy of the Benchmark chart of home prices for Victoria by area and also by municipality. Please don’t try to accurately gauge the selling price of a property from this alone as there are very many variables to consider. The average price graph and inventory & sales graphs are attached as well. In the latter at the bottom of the page, the beige bar represents listings, while the blue dotted line represents the number sold. Our market is small, which means the numbers are a small sampling and the figures can be easily skewed by the sale of many homes in either higher or lower price ranges, so the graphs and statistics are best used as a tool to identify trends only. The townhouse and condo graphs should be taken more lightly, as they have many fewer sales than the single family homes. It’s all about trends.
Million dollar plus sales: In February we saw 48 properties sell for a million dollars or more. That number includes seven properties that sold for over $2 million, and one that sold for over $3 million. The prior month we saw 34 sell in the higher price ranges. RE/MAX consistently has the largest market share of properties that sold over a million!
If you are thinking about making a move, whether buying or selling, please do call me, or any member of the team. We‘d be happy to discuss it, even if you decide not to proceed. There’s lots to consider, such as timing, competition, pricing, what to do (or not do) to your current home, and what’s available to purchase. We’d be happy to chat or drop by. Our team brings with it several experienced agents with decades of experience for your benefit, and rest assured we’ll always give you our best advice and an honest price estimate. And please do pass our names along to anyone you know who is thinking about making a move. Ourbusiness grows through personal referrals and we appreciate your trust in referring us to friends. You may feel reluctant to get involved but it’s better to help your friends by providing them with the name of a trusted and knowledgeable professional than for them to venture out looking on their own.
Click here to view the Official News Release from the Victoria Real Estate Board, along with more information and all sorts of statistics.
You’ll find my web page is now forwarded to www.vpsg.ca. Contact me, or any one of the team members there. My cell number however, will never change.