A slight uptick in sales and inventory, but Victoria real estate market still requires commitment to homes
A total of 480 properties sold in the Victoria Real Estate Board region this October, 35.6 per cent fewer than the 745 properties sold in October 2021 but a 17.1 per cent increase from September 2022. Sales of condominiums were down 39 per cent from October 2021 with 152 units sold. Sales of single family homes decreased 32.2 per cent from October 2021 with 230 sold.
“Inventory has remained stable this month and for the first time since May 2022, we see a slight increase in the month over month sales,” says Victoria Real Estate Board President Karen Dinnie-Smyth. “We noted last month that the number of sales for September did not necessarily reflect the on-the-ground activity in the marketplace. October sales have shown what the industry has been experiencing, an increase in activity, more sales and well-priced homes receiving plenty of attention – some receiving multiple offers. If you are considering selling a property, the continually evolving market conditions this month reinforce the need for up-to-date analysis of how to price your home during this type of market. With many micro-markets within the Greater Victoria area conversations with your local REALTOR® on how the housing market is performing in your specific area will be crucial to your success.”
There were 2,192 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of October 2022, a decrease of 4.7 per cent compared to the previous month of September but a 111.6 per cent increase from the 1,036 active listings for sale at the end of October 2021.
“With new mayors and councillors heading to work in several of our municipalities, we hope to see strong commitments to positive ways to manage the current and future housing needs of our communities high on council agendas,” adds President Dinnie-Smyth. “The future cost of housing is at stake. The pressure on pricing and in the market overall will not resolve until we see material improvements in the number and types of properties available in the Greater Victoria area. Rentals, townhouses, duplexes, triplexes and beyond are all needed to help ensure that we do not face another cycle of rapid price increases due to lack of inventory in the future. We hope that all municipalities will be looking at gentle density improvements that will ensure more homes for more people in their community planning.”
The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in October 2021 was $1,216,900. The benchmark value for the same home in October 2022 increased by 10.2 per cent to $1,341,400 but was down 1.7 per cent from September's value of $1,364,200. The MLS® HPI benchmark value for a condominium in the Victoria Core area in October 2021 was $524,500, while the benchmark value for the same condominium in October 2022 increased by 14.9 per cent to $602,700, down by 2.4 per cent from the September value of $617,400.
The release and the full statistics package will be posted to the VREB website at www.vreb.org/current-statistics later this afternoon.
A sandy beach on James Island, near Sidney. The privately-owned island was once again the most valuable piece of private property in the Capital Regional District at $56.47 million.
Property owners on Greater Victoria will find a mixed bag of results when their annual property-assessment notices start landing in mailboxes this week.
In Victoria, owners of single-family homes are likely to see values drop slightly, while condo owners are more likely to see an increase.
Oak Bay saw the greatest decrease in Greater Victoria in the average value of a single-family home, with a six percent drop to $1.14 million.
The Crown corporation says this year’s assessments reflect a slowdown in the Greater Victoria real estate market.
The assessment is an estimate of a property’s market value as of July 1, 2019 and physical condition as of Oct. 31, 2019.
• Assessments, which are used to calculate property-tax bills, are available online at bcassessment.ca.
Most of Greater Victoria’s 13 municipalities saw the typically assessed value of single-family homes either drop or stay the same as last year, according to information released Thursday by B.C. Assessment.
It shows the residential property values for a typical single-family home dropped by as much as six percent in Oak Bay, while homes in Highlands and Central Saanich saw no change.
Only Langford, Sooke and View Royal saw increases in the typical assessment. All other municipalities saw values drop.
That should come as no surprise to property owners after B.C. Assessment warned last month values could drop by as much as 10 percent in some areas of Greater Victoria due to a softening of the real estate market.
The Crown agency said some single-family homeowners could see increases of as much as five percent.
January 2, 2020,
Victoria Real Estate Market wraps up a relatively flat year for home sales A total of 402 properties sold in the Victoria Real Estate Board region this December, 7.2 percent more than the 375 properties sold in December 2018 and a 30.3 percent decrease from November 2019. Sales of condominiums were up 17.5 percent from December 2018 with 121 units sold. Sales of single-family homes increased 13.8 percent from December 2018 with 198 sold.
A grand total of 7,255 properties sold over the course of 2019, 1.47 percent more than the 7,150 that sold in 2018. 2019 sales came in at slightly under the ten-year average of 7,413 properties sold.
“Overall, our market throughout 2019 can be characterized as still active, slow to grow and low in supply,” says 2019 Victoria Real Estate Board President Cheryl Woolley. “Last year we saw many prospective buyers sit on the sidelines waiting for inventory to be added. As a result of this unmet demand, there was and continues to be a push from consumers to create townhomes and condos at accessible price points. We began 2019 discussing the potential impact of various taxes and lending rules introduced by the federal and provincial governments that were designed to calm housing market activity - although this activity had already begun to slow following our hyper-active market in 2016/17. The most impactful government change we saw was the tighter mortgage lending rules, which lowered consumer borrowing power and made many unable to qualify for the value of mortgages they had in the past, therefore compressing more demand into our mid- and lower-priced property market.”
There were 1,952 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of December 2019, a decrease of 18.6 percent compared to the month of November and a 1.8 percent decrease from the 1,988 active listings for sale at the end of December 2018.
“Constant demand on this middle housing segment has put a moderate amount of pressure on pricing,” adds Woolley. “And although we did not see huge price increases through 2019 as we did in the run-up through 2016, we do see buyers entering into multiple offer situations and competing for properties. The high end of the market – over $1.5 million – has been softer, which is nice for a very small percentage of buyers in our area, but difficult on sellers who have seen some equity erode. The theme heading into 2020 does for now appear to be the limited selection of single-family homes and growth in pressure for more condos and townhomes. What remains consistent is that in this complex market, buyers and sellers value the assistance of their REALTOR® to navigate one of the biggest purchases most will make in their lifetime."
The Multiple Listing Service® Home Price Index benchmark value for a single-family home in the Victoria Core in December 2018 was $860,400. The benchmark value for the same home in December 2019 decreased by 0.6 percent to $855,000, slightly less than November’s value of $855,400. The MLS® HPI benchmark value for a condominium in the Victoria Core area in December.
Multiple Listing Service® (MLS®) residential sales in the province are forecast to increase 2 per cent to 80,000 units this year, after recording 78,345 residential sales in 2018. MLS® residential sales are forecast to increase a further 6.9 per cent to 85,500 units in 2020. The 10-year average for MLS® residential sales in the province is 85,800 units.
“The negative shock to affordability and purchasing power created by the B20 stress test on mortgage borrowers is expected to continue constraining housing demand in the province this year,” said Cameron Muir, BCREA Chief Economist. “Favourable demographics along with continuing strong performance of the BC economy is expected to underpin housing demand over the next two years.”
The policy-induced demand shock has contributed to an increase of the inventory of homes for sale in most regions of the province. As a result, market conditions are expected to provide little upward pressure on home prices this year, with the average annual residential price forecast to remain essentially unchanged, albeit up 0.5 per cent to $716,100. Modest improvement in consumer demand is expected to unfold over the next two years as households further adjust to the mortgage stress test.
Having a Starbucks open near a neighbourhood could increase nearby home values, potentially by a few thousand dollars, a new study from Harvard Business School finds. The study’s authors focused on the gentrification of neighbourhoods using Yelp data but discovered the “Starbucks effect” during their research.
lauramusikanski - Morguefile
Using Yelp data to find the entry of each Starbucks in a ZIP code, researchers found a 0.5 percent increase in housing prices within a year after a Starbucks opens.
Harvard economics professor Edward Glaeser says he believes the home price rises are not due to the actual Starbucks opening but may be more of an indicator of affluent customers in the area.
"The presence of a Starbucks is far less important than whether the community has people who consume Starbucks," Glaeser notes in the paper. "Consequently, we think that this variable is likely to be a proxy for gentrification itself. … The most natural hypothesis to us is that restaurants respond to exogenous changes in neighbourhood composition, not that restaurant availability is driving neighbourhood change.”
Overall, gentrification, according to the paper says, is “strongly associated” with increases in the numbers of grocery stores, cafes, restaurants, and bars.