Quick Summary: Inventory continues to increase, sales volume improved year over year, and prices remain fairly constant.
Bring on summer! Time for some fun in the sun! It’s that time again for our Monthly Market Update, a service which we provide as a courtesy to our loyal clients and contacts.
Pricing and Activity: For May the core area (which takes in Victoria, Esquimalt, View Royal, Oak Bay and Saanich) is showing a price decrease of about 2.9% year over year. Thebenchmark price of a single family home in the core is $860,800, more than last month’s $843,500 but less than last year’s $886,200. Overall in our entire market area (which also takes in the islands, Western communities and over the Malahat) it’s also negative year over year but just very slightly (less than 1%), standing at $756,000, and higher than last month’s $742,400. 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 May came in at a total of 848 sales in Greater Victoria, more than April’s 696. Last year in May there were 755 sales so it’s a good improvement year over year. (Thosestatistics include all property types and all areas covered by the Victoria Real Estate Board.)
The Market: The lower price ranges are seeing activity mostly due to the government taxes and policies which have been mentioned numerous times, of which the national mortgage stress test is likely having the most significant impact. And, sorry to be repetitive, but in BC we also have the Foreign Buyer Tax, Vacancy Tax and the Speculation (asset) Tax. Some price ranges and areas are affected more than others, and affordable homes and homes priced well see more activity. The mortgage stress test affects the amount of mortgage people can qualify for by approximately 20%, helping activity in lower priced properties.
Inventory is showing a total of 3,019 properties on the market at month end, which is the most in many years but still considered low. It’s higher than last month’s 2,751, and also higher than May of last year which was 2,394. Low inventory continues to limit choices. For perspective, in the last busy market cycle around 2006 we saw inventory in the 3,200 range. Through the last few years it’s been below or just above 2,000 a good part of the time and recently risen. 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 3.04% if you qualify, depending on your down payment, term, credit history, institution etc. This has been coming down and is now back to where it was roughly a year ago. That’s a very good rate, historically speaking. If you’re thinking of moving, take the time to get preapproved 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 May we saw 99 properties sell for a million dollars or more. That number includes eight properties that sold for over $2 million, and two that sold in Oak Bay for over $4 million. The prior month we saw 94 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 us! 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. Our business 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.
Have lots of fun this summer!
Cheers, Ronan, Brenda, Jenny, and Vince.