Inventory continued to decrease in November 2021 continuing a trend of historic under-supply in the Vancouver Island housing stock. Condo listings topped the drop with a 69% year-over-year decrease and a 23% decrease from October. Single family homes dropped 44% year-over-year and 24% from the previous month.
Sales volume, both due to seasonal factors and the highly restricted inventory, also decreased in November. Single-family homes specifically had 353 sales which was 16% fewer than last year. The condo segment saw 110 units change hands in November which was three units more than November 2020 and 12 sales less than October.
While demand is still relatively red hot in comparison to the amount of available listings, there may be some early
Historically low inventory continues to angle property sales in a downward direction in the Victoria real estate market. The region only saw 653 total property sales (17.9% less than November last year) and it is still clear that demand is at least greater than inventory if not still red hot.
While it is typical for this time of year for the market to slow down a bit we are still seeing frequent if not commonplace multiple-offer situations which indicates that buyers are less deterred by typical seasonal factors. There are also other indicators that the drop in sales is not purely seasonal.
Single family homes, for example, sold 18.6% less than the previous month with a total of 276 sales, but total listings decreased a whole 149 available units
Canadian Employment (November 2021) - December 3, 2021
Canadian employment grew for the sixth consecutive month in November according to Statistics Canada, rising by 154,000 to 19.316 million (0.8%, m/m). Canadian employment had recovered to its pre-pandemic level in September and is now roughly 1% above that level. Since the prior survey period, public health measures were largely unchanged except for some capacity limits and distancing requirements being further eased in Ontario and Quebec.
Employment gains in November were quite widely distributed across sectors of the economy. Employment increased in both the services-producing sector (+127,000) and the goods-producing sector (+26,000), while the employment rate for women aged
Commercial Leading Indicator Dips in Third Quarter 2021
The BCREA Commercial Leading Indicator (CLI) fell from 155.4 to 150.9 in the third quarter of 2021, representing the first decline since the economy began recovering from the COVID-19-induced recession. Compared to the same time last year, the index was up by 9 percent.
It is important to note that while the economy generally continues recovering strongly, we are still in a very abnormal and uncertain environment for commercial real estate. Therefore, the strong economic and employment growth we have seen in previous quarters may not translate directly to improved conditions in the commercial real estate market.
The CLI declined in the third quarter due to a drop in the economic
Canadian Retail Sales (September 2021) - November 19, 2021
Canadian seasonally-adjusted retail sales fell 0.6% to $56.6 billion in September. The decline was driven by sales at motor vehicle and parts dealers (-1.6%) as new car sales continued to be impacted by semiconductor chip supply shortages. According to Statistics Canada's survey, just 0.5% of retailers were closed at some point in September. Preliminary estimates, based on roughly 50% of respondents reporting so far to the agency, indicate that retail sales rose 1% in October.
In BC, sales rose 1.1% to a fresh record in September, erasing declines in July and August. Compared to the same month last year, retail sales were up 6.7% in the province. Only electronics and
Canadian Inflation (October 2021) - November 17, 2021
Canadian prices, as measured by the Consumer Price Index (CPI), rose 4.7% on a year-over-year basis in October, rising at the fastest rate since 2003. On a month-over-month basis, the CPI was up 0.7% in October. The Bank of Canada's preferred measures of core inflation (which use techniques to strip out volatile elements) rose an average of 2.7% year-over-year in October.Major drivers of the year-over-year price increase included transportation prices (+10.1%), shelter (+4.8%), and food prices (+3.8%) partly on continuing supply-chain difficulties. In BC, consumer prices were up 0.43% month-over-month, and up 3.8% on a year-over-year basis.
Canadian Housing Starts (October 2021) - November 16, 2021
Canadian housing starts declined for the fifth consecutive month in October, but remain somewhat strong compared to typical pre-pandemic activity. Housing starts decreased by 13.4k to 236.6k units (-5.3% m/m) in October at a seasonally-adjusted annual rate (SAAR). Comparing year-over-year, starts were up modestly from October of 2020 (4.1% y/y). Single-detached housing starts dipped 3.7% in October to 73.4k, while multi-family and others declined 6% to 163.2k (SAAR).
In British Columbia, starts were essentially unchanged in October, maintaining the level of 35.9k units SAAR in all areas of the province.Single-detached starts dropped 5.6% m/m to 7.5k units while multi-family
There was half the number of actively listed homes this October in Victoria compared to last year and the shortage of options for buyers has had strong effects on sales volume and price. While this time of year is traditionally slower, the decreasing amount of inventory (7.8% down from September) has only marginally dampened the persistent demand and it is clear we are still in a hot market with high sales volume relative to the number of available listings. The combination of the two factors is keeping upward pressure on prices and we are seeing significant increases in Benchmark prices (Benchmark prices being the “average” price of a home in a given area).
The Vancouver Island Real Estate Market continues to struggle with frustration stemming from low inventory pressures. As a result of how few homes are available, the number of sales continues to decrease as well, although not enough to give reprieve on the inventory side of the ledger.
Single family home sales were down 23% in October compared to October the previous year with 398 sales. Condos were down 6% in the same time period with 122 sales and townhomes were down 10% with 88 unit sales. It is fairly safe to assume those numbers would increase if there were simply more options for buyers.
Listings of single family homes were down 46% from last year and 18% from September 2021. This segment has been hit particularly hard as buyers are
BC Housing Market at Historically Low Level of Supply
Vancouver, BC – November 10, 2021. The British Columbia Real Estate Association (BCREA) reports that a total 9,593 residential unit sales were recorded by the Multiple Listing Service® (MLS®) in October 2021, a decrease of 13.7 per cent from October 2020. The average MLS® residential price in BC was $964,777, an 18.9 per cent increase from $811,307 recorded in October 2020. Total sales dollar volume was $9.3 billion, a 2.6 per cent decline from the same time last year. “The story across the province continues to be the record low number of listings,” said BCREA Chief Economist Brendon Ogmundson. “Rising mortgage rates should start to temper sales activity next year, but even with a
