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A local realtor warns against reading too much into figures that show a drop of 25 per cent in year-to-year sales.

According to new figures, the Victoria Real Estate Board recorded 755 sales in May 2018 – 25 per cent fewer than the 1,006 properties sold in May of last year. Compared to April 2018, sales dropped 2.8 per cent. But Cheryl Woolley, president-elect of the Victoria Real Estate Board, said these numbers tell only a part of the story.

While sales might be down, prices and the value of sales have continued to go up, she said. “Is the market going to crash? I don’t think so,” she said, pointing to strong fundamentals such as the desirability of the region at large.

So what accounts for the drop? While the market was bound for a slow down, recent changes in mortgage rules and the introduction of various measures such as the speculation tax have amplified this decline.

“It’s an artificial slow-down,” she said.

Elsewhere, Vancouver recorded a drop of more than 35.1 per cent in recorded sales over the same time last year.

Looking at specific categories of properties, condominium sales dropped 17.4 per cent in May 2018 compared to May 2017. Sales of single family homes dropped 23 per cent.

Local realtor Leo Spalteholz noted on his blog House Hunt Victoria that sales are “down substantially” from last year. He described this drop as “quite unusual” when measured against historical trends. Looking at monthly sales over 10 years, the general trend lines shows that single family homes sales start rising in January, with the general peak of sales happening around May. But this year diverges from this general trend line, with sales actually dropping in May. Sales for this year have also failed to match the average.

Spalteholz said this phenomenon happens in times when the market is slowing quickly enough that it overpowers the normal seasonal increase.

This said, the local real estate market continues to favour sellers with the ratio of sales to active listings hovering around 40 per cent – well into seller’s market territory, which starts above 20 per cent.

While supply is ticking up, inventory is still very low, said Spalteholz. “It is increasing more quickly in recent months but will still take quite a while to get even to the 10-year average, let alone to the highs of [five] years ago when there were nearly twice as many detached homes on the market,” he said.

The low inventory means that about 20 per cent of single family homes are selling over asking price, he said. “It’s like a pot that you’ve turned down from a roiling boil to a simmer,” he said. “Still not a great idea to stick your hand in there but at least the soup isn’t splattering all over the place.”

Source: Wolf Depner, June 7, 2018, Saanich News

Real estate association says prices rose by just 0.2 per cent compared to same time last year 

Home prices across B.C. showed little change in April, according to the BC Real Estate Association.

In figures released Monday, the association said the average home price rose by just 0.2 per cent compared to April of last year, up to $730,507.

Some regions saw bigger increases, with Chilliwack prices going up by 16 per cent, Fraser Valley prices by 10.2 per cent, southern Okanagan prices by 15.9 per cent and Vancouver Island prices by 11.3 per cent.

However, sales were down 17 per cent across the province compared to the same time last year.

BCREA chief economist Cameron Muir said the new mortgage regulations have made buyers wary, but they have been adjusting.

The new rules, known as the “stress test,” mean all borrowers must now qualify for a mortgage based on either the five-year benchmark rate or their lender’s actual rate plus two per cent, whichever is higher. The change will apply to all mortgages, new or renewed, even if the down payment exceeds 20 per cent.

“The impact of more burdensome mortgage qualifications for conventional borrowers is expected to soften over the next several months as potential buyers adjust both their finances and expectations,” he said.

For the first four months of 2018, home sales dropped by 12 per cent, although the average price rose 5.7 per cent to $731,661.

Source: Katya Slepian, BPdigital.ca, May 14, 2018

Tip 1: Get Organized!
Relocating involves many moving parts! From setting up and canceling leases and utilities to hiring movers and finding new medical providers, there can be a lot of information and paperwork to keep track of. So that you have a landing zone for all things move-related, create a moving binder. Place anything into it that you may need during your move, and add to it as you acquire paperwork, receipts and other items along the way! 

Tip 2: Do Your Research
Save yourself weeks of stress and chaos by researching as much as you can about your new hometown before moving. Investigate school districts, neighborhoods, public transportation options, access to shopping, the closest grocery store, medical providers, fitness centers and more. Prior research will allow you to hit the ground running once you arrive, smoothing the transition for all.

Tip 3: Prepare Weeks in Advance
Use the weeks leading up to your move to sort, purge and organize. Hold garage sales and use Craigslist to get rid of unwanted items. Organize and group items that should be packed together so they are in the right spot when unpacked in the new home. If packing yourself, scout big-box stores for (free!) empty boxes and collect newspapers from neighbors (always ask first!). Remove light bulbs from lamps, place dry goods (like flour and sugar) into sealed Ziploc bags, and bag up any loose or small items that can make a mess of boxes. Heading into packing day with everything organized will make the experience easier!

Tip 4: Designate “No-Pack” and “First Unpack” Items
Whether or not you are using professional packers, be sure to clearly dedicate zones or items that should not be packed into boxes. No-pack items can include things for the trash, things you will transport personally in your suitcase or vehicle, or things you need to return (like cable boxes and remote controls). Additionally, pack an “Unpack First” box that contains living essentials like sheets, towels, shower curtains, basic cookware, eating utensils and clean sets of clothes. Once you get into your new place, this allows you to easily access your necessities instead of digging through all the boxes!

Tip 5: Take Apart Unstable Furniture
Depending on how far you’re moving and how your stuff is being transported, it may be essential that you disassemble furniture. Keeping furniture in tact makes for less hassle getting setup on the other end. However, keeping things fully assembled can also lead to unnecessary damage! We’ve found it best to take off table and chair legs, shelving units with removable shelves and any awkward or oversized items. If you know your furniture has weak spots or previous damage, alert the movers (or your helpers!) to disassemble and/or wrap it appropriately.

Tip 6: Keep Track of Hardware
One of our best tips is to attach hardware to whatever you are disassembling with Ziploc bags and packing tape. Whether it’s a full piece of furniture or simply the screws that attach a shelf to the wall, keep everything together. This not only keeps you from losing hardware along the way, but it makes putting furniture and the house back together much easier. When it’s time to hang that shelf, everything you need will be there!

Tip 7: Label Boxes
Take the time to label boxes really well. Once things get unloaded on the other side, it can be frustrating when all the dishes get placed into the bedroom because the boxes are poorly labeled. Clearly label every single box with a good description of the contents inside and where it will go in the new place. Use color-coded markers, tape or stickers to sort and organize boxes by room.

Tip 8: Use the Right Materials
Proper packing materials make all the difference in ensuring your items arrive in tact. If you have fragile items (like dishes, china, frames or figurines), invest in special boxes (dish packs) and paper for transporting such things. Wrap furniture, especially painted furniture, in plastic wrap or blankets to prevent nicks and scratches. Use original boxes and packaging (when possible) for electronics such as televisions, speakers and computer devices. Lastly, don’t pack boxes (or the truck or car) too full. Items get broken when you stuff things in. Use an extra box or make an extra trip to ensure everything travels safely.

Tip 9: Bring What You Can
Setting up a new home can be very expensive. From buying furniture to fit your new space to restocking the pantry and cleaning supplies, new home purchases can add up fast. When possible, bring items with you. Professional packers often won’t pack foods, liquids, hazardous materials (like propane or fire extinguishers) or live plants. If possible, bring these things with you so you don’t have to spend the time or money to replace them.

Tip 10: Ask for Help!
Whether you use professional packers or do it yourself, moving is exhausting. From prep work to packing boxes and loading the truck all the way through unloading and getting settled, there is a lot of work to be done. Many hands make light work, and it’s worth calling in favors. If you can, hire movers. If you can’t, enlist the help of friends and family along every step of the way. From packing boxes to loading heavy items to watching the kids while you pack, every little bit of assistance will help you get moved and settled quicker and easier!

Source: Forrent.com, July 23, 2015 Edition

A series of new figures show the local housing market in a state of uncertainty.

New figures from Canada Mortgage and Housing Corporation (CMHC) paint a mixed picture when it comes to new housing starts. Housing starts in the category of detached homes dropped by 32 per cent in March 2018 compared to the same period last year. New apartment starts, however, rose 77 per cent, for an overall increase of 31 per cent.

These figures have led CHMC to the conclusion that Metro Victoria appear to be moving in “different directions with single-detached and apartment units diverging.”

Overall, these trend-lines suggest that supply for single detached homes will remain low in the foreseeable future, while apartment units remain popular.

Housing start figures for Victoria appear in line with provincial figures. New housing starts for single-detached homes declined 21 per cent across the province, while all other starts rose 12 per cent, for an overall increase of four per cent, with considerable regional variations. Housing starts in the Greater Vancouver region rose 30 per cent, thanks to strong migration, household formation and employment growth in the region.

Overall, local prices continue to favour sellers. According to the British Columbia Real Estate Association (BCREA), year-to-year prices in Victoria have risen 15 per cent from 2017 to 2018, and nearly 21 per cent across the rest of Vancouver Island.

This said, it is becoming increasingly apparent that market conditions are starting to change.  While the market remains a seller’s market favouring current home owners, figures form the BCREA show the overall market shifting towards a more balanced state, as new mortgage rules are starting to show their effect. 

“More burdensome mortgage qualifications are having the predictable effect of swiftly curbing housing,” said Cameron Muir, BCREA’s chief economist in his April market update, which shows provincial sales declined nearly 25 per cent compared to the same period last year. “You simply cannot pull as much as 20 per cent of purchasing power away from conventional mortgage borrowers and not create a downturn in consumer demand.”

These provincial figures align with local figures that show sales dropped 25.9 per cent year-to-year.

Source: Wolf Depner, Oak Bay News, April 18, 2018 

Greater Victoria real estate prices chart., Photograph By SOURCE: Victoria Real Estate Board

Greater Victoria home prices hit record levels last month as demand stayed strong and inventory remained tight.

Benchmark price for a single-family house in Greater Victoria reached $710,500 in February, up by 10.6 per cent from the same month a year ago.

Benchmark price for a single-family house in the core area — which includes Victoria, Oak Bay, Saanich, View Royal and Esquimalt — was higher, at $840,300. That’s an increase of nine per cent from February 2017.

The Victoria Real Estate Board uses benchmark price an indicator of cost for a typical house in a particular area.

Condominium prices also set a record, with the benchmark price in the region at $463,100, up 20.3 per cent from a year earlier.

Climbing prices are good news for sellers, but first-time buyers are increasingly turning to the condo market as a way to afford a home.

B.C. Finance Minister Carole James unveiled a new budget last month filled with measures aimed at opening the housing market to more people. The government vowed to help build 114,000 units and to spend $7 billion on new housing over the next 10 years. But real estate representatives cautioned that the market can be slow to change.

Last month, the lowest benchmark value in the capital region for a single-family home was in the West Shore at $605,100. Lower land values and developers building on smaller lots have fuelled strong construction in the West Shore, especially in Langford.

A total of 545 properties sold through the Multiple Listing Service of the Victoria Real Estate Board last month. That’s down from 675 in February 2017.

Buyers face hurdles, said Kyle Kerr, Victoria board president. “They’re in a market that has experienced long-term low inventory which means more price pressure and competition on homes.”

A total of 1,545 properties were for sale last month, up slightly from February of last year with an inventory of 1,537.

Demand is outpacing supply, he said. He called on the province to work with municipalities to reduce the time it takes to add new housing.

The Vancouver Island Real Estate Board, which covers the area north of the Malahat, said buyer demand and limited supply have created a sellers’ market. Multiple offers are common, especially for properties between $400,000 and $500,000.

A total of 316 single-family homes sold through that board last month, slightly below the 345 sold a year earlier. However, the number of condos sold climbed by 28 per cent. Benchmark price for a single-family home in the region was $483,400, an increase of 19 per cent from a year ago. Benchmark price for a condo was $293,900, a boost of 29 per cent year-over-year.

Source: Victoria Times Colonist, March 2, 2018, cjwilson@timescolonist.com

B.C.’s new package of tough measures takes aim at tax evaders who stash money in real estate, hide their ownership and speculate in the increasingly pricey market.

The foreign buyers tax is coming to Greater Victoria and Nanaimo and is being increased to 20 per cent on the purchase price from 15 per cent in markets where it is applied. New taxes are coming in for speculators and buyers of luxury properties will pay more.

These moves are underway as capital region citizens watched home prices become unaffordable to many amid a tight rental market with a vacancy rate of just 0.7 per cent.

Finance Minister Carole James said in her Tuesday budget speech that B.C. is facing a housing crisis. She predicted the new measures “will return a sense of fairness.”

“What we are looking to do is to moderate the market,” she said.

B.C. will monitor impacts and make adjustments if needed as measures are rolled out, she said.

Jock Finlayson, executive vice-president of the Business Council of B.C., said: “It’s quite unprecedented in the housing market to have several measures like that brought forward so we will see how it filters through and affects the market. We don’t know at this point.

“It could be disruptive. It may be nothing more than a hiccup.”

Government initiatives will impact the upper end of the market, Finlayson said.

About half a billion dollars of additional revenue generated from the various housing-related announcements will go to support government afforable housing efforts and other government programs, he said.

New reporting rules for buyers, a public registry to reveal who actually owns a property, and sharing new information with the federal government to fight tax evaders will all be required by the province.

“Countering tax fraud starts with better information sharing,” James said.

B.C. is aiming to end murky home ownership.

“Numbered companies, offshore and domestic trusts, and stand-in owners hide the true source of the capital that is flowing into our real estate market,” James said.

“We are going to change that.”

Lack of information is a “real gap” and the first step in auditing and enforcement, she said.

James referred to condo-flipping, which sees units being sold multiple times before they are even lived in.

“We wonder if those people have paid their fair share of taxes,” she said.

Developers will be required to collect and provide comprehensive information about pre-sales. Condominium are frequently marketed through pre-sales agreements before construction is finished.

Foreign buyers are expected to deliver $35 million in taxes in the 2018-2019 year, and $40 million the next year.

The majority of buyers in the Victoria area are domestic.

Between April and the end of December last year, foreign buyers bought 343 properties in the capital region, representing 4.1 per cent of all sales.

They spent $261 million, of 4.8 per cent of value, out of $5.4 billion.

B.C. will be requiring more disclosure by foreign buyers including: information on worldwide income, household information, and social insurance numbers. Relevant information will be shared with Canada Revenue Agency.

The new speculation tax applies to international and domestic buyers who do not pay income tax in B.C and might leave their homes vacant.

“B.C.’s real estate market should not be used as a stock market,” James said.

The measure “will penalize people parking their capital in our housing market simply to speculate, driving up prices and removing rental stock,” she said.

The speculation tax is expected to bring in $87 million in the 2018-2019 tax year and $200 million in the next year.

Luxury home buyers will pay more.

A new property transfer tax on homes worth more than $3 million will bring in $81 million more in each of the coming three years. The tax is rising to five per cent of a property’s value from three per cent.

The capital region is home to many luxury properties valued at $3 million and more. These homes are often along the waterfront in municipalities such as Oak Bay and North Saanich. Some are occupied only part time.

It remains unclear how the speculation tax will affect people who have more than one home or hold a vacation property in B.C.

Source: Carla Wilson, Victoria Times Colonist, Feb 20, 2018

New figures that show lower real estate sales could be a sign of things to come.

That is the message from local industry leaders after the release of figures that show real estate sales dropped nearly 10 per cent.

Kyle Kerr, president of the Victoria Real Estate Board (VREB), said the figures met expectations.

“We expected January to be a bit slower after the increase in activity we saw in November and December, which was likely due in part to buyers entering the market early to avoid the new mortgage stress test,” he said.

The full effect of the new rules designed to curb real estate speculation will not fully appear later, he added. “We won’t know how much that stress test will affect the spring market until we see the numbers, and spring is also the time when sales traditionally pick up.

Looking closer, statistics show rising prices against the backdrop of low inventory. Figures show 1,491 active listings in the Greater Victoria region — up 7.7 per cent from December 2017, but close to two recent historic low points in December 2016 and January 2017.

This “lack of inventory” as described by VREB has in turned maintained pressure on prices. The benchmark value for a single family home in the Victoria Core (which includes Saanich) was $831,900 in January 2018 — up 9.3 per cent from $761,100 in January 2017.

“We can also see the effects of headwinds influencing our market in 2018, including attempts to curb demand at all levels of government,” said Kerr. “The mortgage stress test is the latest to be introduced, and we may learn of further measures later this month when the provincial budget is released.”

January’s numbers have received a good deal of scrutiny and commentary, as a would-be seismograph of the new mortgage rules and other potential political developments that might impact the real estate industry, an important sector of not just Victoria’s economy, but also the provincial economy-at-large. Ottawa, for example, has expressed concerns about Canadians’ debt-load, while the provincial government has been considering various measures to improve housing affordability, as well as curb illegal activities involving real estate.

Sales through the first two weeks of 2018 were down significantly compared to the same period the year before with commentators such as Leo Spalteholtz of househuntvictoria.ca pointing to the new mortgage rules. Then sales took off through the third week of January in leading towards the final figures, which Spalteholtz says actually reflect a market of “contradictions.”

“There are just as many single family homes selling now as last year, but they are taking nearly twice as long to sell (31 days). Meanwhile condo sales are down by a quarter, inventory is up, but they are selling twice as fast as last year (8 days),” he said.

Speaking with the Saanich News just days before the end of the month, Kimberly Legeard of New Port Realty, meanwhile, thinks that the stress test has had a negative effect.

“What we are seeing is a lot of challenge around the mortgage test,” she said. With prices high already, it has impacted people’s purchasing power, she said. Meanwhile, would-be sellers in Victoria might be hesitating to put their properties on the market because they might not find another place to live, she said. 

Source: Wold Depner, Oak Bay News, Feb 5, 2018

About 5,700 sales were recorded in December, up 21.5 per cent over same period last year 

The B.C. Real Estate Association says fewer homes were sold across the province in 2017 compared with the year earlier, but it says prices were up and sales remained above 100,000 for the third straight year.

The association’s snapshot of 2017 residential sales shows 103,763 properties changed hands, down 7.5 per cent from the 2016 record of 112,211.

The total dollar value of all sales also slipped 5.1 per cent to $73.63 billion but the association says the average price of a home nudged up 2.7 per cent to $709,579.

READ MORE: Greater Vancouver condo prices jumped 20 per cent in 2017

READ MORE: New mortgage rules to take effect in 2018

December was also a strong month for sales, as seasonally adjusted purchases jumped four per cent from November, although the association says year-end results may reflect buyers hurrying to avoid tougher mortgage qualification rules in January.

A total of 5,738 sales were recorded across B.C. in December, an increase of 21.5 per cent over the same period last year, with the average residential price province-wide set at $734,108, a leap of 12.1 per cent from December 2016.

Association chief economist Cameron Muir says B.C.’s strong economy, employment growth and rising wages supported the healthy demand for housing in 2017.

“Above trend migration, both international and interprovincial, also bolstered housing demand,” he says.

Condominium sales in urban centres and sales of all types of properties in retirement-oriented communities were also fuelled by B.C.’s changing and aging population, the association says.

Source: The Canadian Press, January 12, 2018