Sales of homes are up 21.9 per cent in the Greater Victoria region compared to the same time last year, but the increase – both in sales and in property values – has more to do with supply than demand.
On Monday, the Victoria Real Estate Board released its report on real estate activity, highlighting 29 consecutive months of sales going up. October saw 734 properties sold, up from 602 in the same month last year, despite fewer listings this year than last.
“It’s nothing new,” said Guy Crozier, president of the VREB. “It’s just that after two-and-a-half years, it’s really becoming noticeable.
“The inventory of available homes has dropped, and that’s what’s really affecting the market. Sales are really strong, but the inventory of available houses is getting lower and lower, and it’s starting to have an effect on prices.”
As of Oct. 31, the board surpassed its 2014 sales total of 6,698, having sold 7,257 properties in 10 months. The average price of a single family home in Greater Victoria is $637,853, up from $594,282 in 2014.
The sales to active listings ratio for October sat around 29 per cent. According to the VREB, a ratio above 25 per cent indicates upward pressure on prices, making it a sellers’ market.
“Prices across the region are basically up 9.5 per cent across the board, and higher in some areas, especially the areas that are close to the core where there’s not a lot of developable property and the supply can’t keep up with the demand,” said Crozier.
“Although this has been going on for two-and-a-half years, it’s really now starting to make it difficult for buyers to find the right home in the right neighbourhood because the inventory’s dropped so low.”
For Saanich, Crozier said the district is a good example of what’s typical for home sales in the region, reflecting the steady increase in prices since 2013.
“It’s close to the core, but it’s not Victoria, Oak Bay, Fairfield – but it is also not the West Shore,” he said.
When asked how he thinks the market will look in the near future, Crozier said he’s hopeful that more houses will be listed in the new year, but the supply may still be somewhat constrained.
“I think there will be more houses coming on in the spring,” he said. “But I don’t think you’re going to see inventory back to the levels of 2011 or 2012 any time soon. It’ll be very difficult for the Victoria market to recover to those levels that quickly.”
When buying or selling a home, Crozier said it’s best to consult with a knowledgeable realtor who is familiar with your neighbourhood and how its market has changed recently. He noted a realtor can help you find the best home for your needs or sell your home at a strong but reasonable asking price.
“Small, micro markets in certain neighbourhoods have changed so much, it’s really important that if you’re going to try to sell your home, you need to get a realtor to make sure you have really up-to-date information,” he said. “What information you relied on six months ago versus what you rely on today could be very different.”