As house prices continue to rise on Vancouver Island, a new report has analyzed the latest trends behind the boom in local real estate sales.
The Re/Max Spring Market Trends Report looked at the first quarter of 2016 and noted a 10 per cent increase in the average residential price in Greater Victoria, jumping from $495,137 a year prior to $543,564. In B.C., that increase falls just behind Greater Vancouver (24 per cent) and the Fraser Valley (31 per cent).
While locals still make up about seven out of every 10 buyers on the Island, Re/Max Camosun general manager Ray Blender said they’ve seen a small increase in Lower Mainland homeowners heading to Greater Victoria.
“It’s a limited trend,” said Blender. “Certain people that are being bought out for very high prices in Vancouver and the core area are looking for a place to live. Those people are moving because they have the advantage now of more money being made from their properties in Vancouver.”
Blender also noted the Island is seeing an influx of tech companies – and subsequently, tech professionals – as housing prices on the mainland have made it difficult for workers in the industry.
“The Vancouver market is experiencing difficulty in holding onto tech people because of the cost of housing,” he said. “Some of the firms are looking outside of the Vancouver market to relocate their businesses.”
The report also notes less certainty from prospective buyers in B.C. of ever owning a home they love, compared to buyers in other provinces. Re/Max found 64.9 per cent of British Columbians find that goal attainable, compared to 77 per cent in Ontario, 82.3 per cent in Quebec, 83.2 per cent in Saskatchewan and Manitoba, 87.8 per cent in Alberta and 89.3 per cent in the Atlantic.
That falls in line with their findings from Canadian millennials, 37 per cent of whom are looking to family, friends or a co-buyer for financial help with their down payment. Blender said the issue of first-time home ownership in B.C. isn’t just an issue for millennials, but affects transplants to the area.
“You could also include new recruits in the RCMP and the Navy,” said Blender. “If they’ve been transferred from Halifax to here, it’s a bit of a shock.
“They look farther afield, they move out from the core. That’s why we’re seeing more activity in places like Mill Bay, where the entry levels are lower than they are here.”
Victoria has seen a very active housing market this quarter, with 48 per cent more sales compared to the same time last year. As a result, the Island has continued to be a seller’s market, and Blender said it’s hard to determine if these housing trends will continue to rise or drop off.
“The smart answer is always, ‘It’ll keep going until it stops,’” he said. “We never know when it’s going to stop or whether it will come with a bang or a whimper. Nothing can sustain the level of activity and the price increases on a basis that we’ve now achieved.”