As expected, government influences are impacting our Victoria and BC wide real estate market. The combination of new federal tax strategies, mortgage stress test, increased interest rates, expanded and increased foreign buyer tax and impending speculation tax is starting the push the market balance towards favouring buyers. There is widely varied market activity by price range and area with the lower end in our Victoria market still in very short supply.
Sales of all property types declined in March by 25% from the previous year with just 688 sold down from 929 in march of 2017. Condominium sales were down by 28% with just 211 sold and single family homes were down by 30% with just 337 sold this March.
The Victoria Real Estate Board reported an increase in the number of active listings at the end of March up to 1,766 from 1,566 at the end of March last year. Those numbers include properties of all types including raw land, commercial and recreational. Looking at just “residential”, the trend is definitely increasing inventory and fewer sales. For the first time in more than a year we now have slightly more active residential listings (just over 1,400) than we have licensed Realtors (1,355).
As always, individual market areas, price ranges and property types are experiencing significant differences in the balance of supply and demand. While there continues to be strong interest and activity in the upper end, the proportion of sales to listings of luxury homes has slipped to more than a one year supply. Although the balance is shifting, the lower and mid-range of both condos, attached and detached housing remains significantly undersupplied with only a 6 week supply relative to sales to listings in Victoria under $500,000.
Despite all the intervention and external influences, our economy is still the strongest in Canada, unemployment the lowest, climate and lifestyle the best, so we still have people moving here who need homes! That demand appears to be continuing to drive prices up with new records for Home Price Index Benchmarks last month. Single family homes in Victoria’s core increased 9.4% year over year from $785,600 to $859,400 and the benchmark for condos in the Victoria core increased 19.6% over the past year from $409,700 to $490,700.
Our provincial government has introduced harsh measures with the intention of “reducing home prices in British Columbia”. I understand the intention, based on the desire to make housing more affordable. The trouble with that approach is that it will undermine our economy, lead to job losses, erode equity from the almost 70% of BC residents who own their homes and more. BCREA Economics analysis* shows that even a relatively modest negative price shock will produce significant consequences to the BC economy. The solution we need is not more restrictions and taxes but deregulation and incentives for developers to create more affordable housing.
If you are wondering about taking advantage of this market or you happen to know someone who is, give us a call. For up to date and relevant information for you please call or text us at 250.386.8181 to arrange your free consultation, without obligation of course. We can help you to navigate this year’s spring market, ensuring any purchase and/or sale goes smoothly.
The Neal Estate Team
Victoria’s Real Estate Experts
“Go with those who know!”
Leave a Comment
The Neal Estate Team is your #1 source for all of your Victoria BC real estate needs. Get in touch with us online or by phone at (250) 386-8181 to speak with a Victoria real estate buying or selling expert today. With decades of experience as a top selling Victoria REALTOR® and ranked in top 1% globally with over 4,000 transactions and $1 Billion SOLD, Ron Neal & The Neal Estate Team have the industry experience and market knowledge to help you make smart and informed buying or selling decisions.