Mikaila Rhodes Victoria Realtor®

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Victoria Housing Market Still Finding Its Balance

August 1, 2018  A total of 651 properties sold in the Victoria Real Estate Board region this July, 17.6 per cent fewer than the 790 properties sold in July of last year, and an 8.1 per cent decrease from June 2018. Sales of condominiums were down 22.6 per cent from last year in July with 188 units sold. Sales of single family homes were down 16.5 per cent from 2017 with 340 sold this July.

"We are in a different market now than what we have seen for the past two years," says Victoria Real Estate Board President Kyle Kerr. "And while we see inventory creeping up after the drought in 2017, especially in the multi-million-dollar range, across our region there are 30 per cent fewer homes listed for sale under $750,000 than this time last year. This means that if you are shopping in the $750,000-or-less bracket, you are in a fast-moving market with low inventory. For example, of the 176 single family detached properties sold in our Core and Malahat regions during the month of July, only 59 (34%) were listed for $750,000 or less. And of those, 28 (47%) sold at or over list price. This illustrates the high demand for homes at or below this price point, and the pressure that is still pushing that segment of our market. If you are looking for a home priced at $1.5 million or above, there is more selection than last year and those homes are sitting on the market longer. For the first seven months of 2017 there were 481 single family detached properties for sale listed at $1.5 million or above. For the same time period in 2018, there were 664 properties for sale in this range, an increase of 27.6 per cent."

There were a total of 2,607 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of July 2018, an increase of 0.5 per cent compared to the month of June and 35.7 per cent more than the 1,921 active listings for sale at the end of July 2017. 

"Each year we tend to see a plateau in inventory over the summer months," adds President Kerr. "It is possible that we will see more inventory come into the market through the fall when there is often a burst of activity in our market, but it's hard to predict how that inventory might be priced. Ideally, we will see more inventory come in at under the $750,000 level to help push our housing market into more balanced territory across all segments." 

The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in July 2017 was $834,200, while the benchmark value for the same home in July 2018 increased by 5.5 per cent to $880,000, slightly lower than June's value of $889,600. The MLS® HPI benchmark value for a condominium in the Victoria Core area in July 2017 was $442,100, while the benchmark value for the same condominium in July 2018 increased by 12.1 per cent to $495,700, slightly higher than June's value of $496,500.

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Continued uncertainty brings predictable results for the Victoria real estate market

July 4, 2018  A total of 708 properties sold in the Victoria Real Estate Board region this June, 29.8 per cent fewer than the 1,008 properties sold in June of last year, and a 6.2 per cent decrease from May 2018. The sales of condominiums were down 25.1 per cent from last year in June with 230 units sold. Sales of single family homes were down 34.7 per cent from 2017 with 357 sold this June.

"June typically signals the conclusion of the busy spring market, and activity lightens into the summer," says Victoria Real Estate Board President Kyle Kerr. "However, because of decelerating growth due to aggressive government implementation of policies to reduce demand, Victoria's real estate market has been hobbled since the start of the year when federal restrictions around mortgage qualifications were rolled out. Even demand side measures that are not yet live, like the Vancouver/Kelowna/Nanaimo/Victoria-specific Speculation Tax, are dragging the market down as many consumers stand aside to watch what happens."

There were a total of 2,595 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of June 2018, an increase of 8.4 per cent compared to the month of May and 35.5 per cent more than the 1,915 active listings for sale at the end of June 2017.

"The good news is that inventory is slowly being added to the market, though we are still very far off from our ten year average inventory level of 4,100 listings" adds President Kerr. "The slower pace of the market has created more time for buyers who may have been hesitant to jump in during the high pressure market conditions of recent years. Homes are spending a bit longer on the market and there are fewer multiple offer situations than in the past, and if we see more listings over the next few months we may be heading back into a more balanced market situation. Every type and location of property is a separate segment of our market, and there are varying pressures and demands, so if you are buying or selling it is wise to take advantage of the services of your local REALTOR® to help navigate this changing market." 

The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in June 2017 was $829,600, while the benchmark value for the same home in June 2018 increased by 7.2 per cent to $889,600, higher than May's value of $878,100. The MLS® HPI benchmark value for a condominium in the Victoria Core area in June 2017 was $430,400, while the benchmark value for the same condominium in June 2018 increased by 15.4 per cent to $496,500, slightly higher than May's value of $493,900.

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Greater Victoria Summer Market Update

A total of 755 properties sold in the Victoria Real Estate Board region this May, 25% fewer than the 1,006 properties sold in May of last year, and a 2.5% decrease from April 2018. The sales of condominiums were down 17.4% from last year in May with 237 units sold. Sales of single family homes were down 23% from 2017 with 406 sold this May.

"It's no surprise that our current market is very different than it was last year...due to a number of factors that have created hesitation in consumers, including recent heavy measures by the provincial government to reduce the value of home prices and the federal government's new mortgage qualification rules. Combine these factors with rising interest rates and you've got a housing market that is in transition due to outside influences. Every time there is intervention into a market, it takes a few months for the market to rebalance. With the continual changes of late from different levels of government, our market is experiencing a new cycle of ongoing uncertainty...Unfortunately, in our area we have one third fewer single family homes for sale under $750,000 when compared to last year, so we're seeing pressure from increased competition on a smaller number of homes, which is really pushing the under million dollar market. We have a much larger inventory of higher value homes this year. For listings priced at $1.5 million and above, the number of active listings is almost 50% higher than last year at this time. Arguably, many of these properties may be listed due to new and incoming taxes from the provincial government. The Foreign Buyer Property Transfer Tax, the Speculation Tax, and the increased School Tax are putting pressure on those high value home owners. Unfortunately, these taxes are not resulting in what the government said it intends - to increase the availability of affordable housing."

There were a total of 2,394 active listings for sale on the Victoria Real Estate Board MLS® at the end of May 2018, an increase of 19.6% compared to the month of April and 26.3% more than the 1,896 active listings for sale at the end of May 2017.

In March there were important changes made to the B.C. Speculation Tax, you can see the Ministry of Finance's Tax Information Sheet with more details on the proposed tax here. The B.C. Government Residential Tenancy Branch announced changes in May for landlords providing notice to tenants and other updates. For full details and to understand these changes you can view their news update
 
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Price Pressure Continues on Lower-Priced Housing in the Capital Regional District

June 1, 2018  A total of 755 properties sold in the Victoria Real Estate Board region this May, 25 per cent fewer than the 1,006   properties sold in May of last year, and a 2.5 per cent decrease from April 2018. The sales of condominiums were down 17.4 per cent from last year in May with 237 units sold. Sales of single family homes were down 23 per cent from 2017 with 406 sold this May.

"It's no surprise that our current market is very different than it was last year," says Victoria Real Estate Board President Kyle Kerr. "Due to recent changes in mortgage qualification rules, many buyers' purchasing power has been reduced. Unfortunately, in our area we have one third fewer single family homes for sale under $750,000 when compared to last year, so we're seeing pressure from increased competition on a smaller number of homes, which is really pushing the under million dollar market. We have a much larger inventory of higher value homes this year. For listings priced at $1.5 million and above, the number of active listings is almost 50% higher than last year at this time.  Arguably, many of these properties may be listed due to new and incoming taxes from the provincial government. The Foreign Buyer Property Transfer Tax, the Speculation Tax, and the increased School Tax are putting pressure on those high value home owners. Unfortunately, these taxes are not resulting in what the government said it intends - to increase the availability of affordable housing."

There were a total of 2,394 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of May 2018, an increase of 19.6 per cent compared to the month of April and 26.3 per cent more than the 1,896 active listings for sale at the end of May 2017.

"We're in an interesting time here - we are seeing different levels of price pressure and price relief in micro-climates of our area," adds President Kerr. "You may find more flexibility if you are shopping for a multi-million dollar estate in certain areas. You may be in for a competition if you're shopping for a lower priced home or condominium. If you're thinking of buying or selling, it's a good idea to meet with a local REALTOR® to understand how the current environment will affect you."

The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in May 2017 was $820,800, while the benchmark value for the same home in May 2018 increased by 7 per cent to $878,100, higher than April's value of $866,700. The MLS® HPI benchmark value for a condominium in the Victoria Core area in May 2017 was $426,900, while the benchmark value for the same condominium in May 2018 increased by 15.7 per cent to $493,900, slightly lower than April's value of $495,100.

 

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Slower start to spring does not signal lower prices for Victoria real estate market

A total of 774 properties sold in the Victoria Real Estate Board region this April, 12.5 per cent fewer than the 885 properties sold in April last year, but a 12.5 per cent increase from the month previous. The sales of condominiums were down 21.6 per cent from last year in April with 225 units sold. Single family homes were 8.1 per cent down from the year previous with 420 sold this April.

"We're now into the spring real estate market, which is traditionally the busiest time of the year for buying and selling homes," says Victoria Real Estate Board President Kyle Kerr. "Last year, the months of May and June were the busiest, so we may see this pattern again but on a slightly smaller scale than last year, since our sales for the year thus far are down about 18 per cent when compared to 2017. Although January to March was quite far behind last year's pace, we may see that margin get smaller as we progress through the spring months and people adjust to the new mortgage qualifying rules."

There were a total of 2,002 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of April 2018, an increase of 13.4 per cent compared to the month of March and 18.5 per cent more than the 1,690 active listings for sale at the end of April 2017.

"We continue to see low inventory in our market, and good homes in desirable locations are still seeing multiple bids," adds President Kerr. "One interesting development we are tracking is the increase of prices in a market of fewer sales. Part of the reason for this is that there is strong pressure on lower-priced properties. After the new mortgage rule changes this year, many consumers have seen a reduction in their buying power, so more are competing for lower-priced properties and in multiple offer situations, pricing is pushed up. Our area just doesn't have the supply or mix of homes needed to meet the demand. We are working with government at all levels to identify ways to meet this demand in the CRD."

The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in April 2017 was $800,100, while the benchmark value for the same home in April 2018 increased by 8.3 per cent to $866,700, higher than March's value of $859,400. The MLS® HPI benchmark value for a condominium in the Victoria Core area in April 2017 was $418,200, while the benchmark value for the same condominium in April 2018 increased by 18.4 per cent to $495,100, which is higher than March's value of $490,000.
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Outside Influences Impact Spring Real Estate Market in Victoria

April 3, 2018  A total of 688 properties sold in the Victoria Real Estate Board region this March, 25.9 per cent fewer than the 929 properties sold in March last year, but a 26.2 per cent increase from the month previous. The sales of condominiums were down 28.2 per cent from last year in March with 211 units sold. Single family homes were 30.8 per cent down from the year previous, with 337 sold this March.

"As we expected, March sales are tracking lower than in 2017," says Victoria Real Estate Board President Kyle Kerr. "This is likely due to a number of factors that have created hesitation in consumers, including recent heavy measures by the provincial government to reduce the value of home prices and the federal government's new mortgage qualification rules. Combine these factors with rising interest rates and you've got a housing market that is in transition due to outside influences. Every time there is intervention into a market, it takes a few months for the market to rebalance. With the continual changes of late from different levels of government, our market is experiencing a new cycle of ongoing uncertainty."

There were a total of 1,766 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of March 2018, an increase of 14.3 per cent compared to the month of February and 13.5 per cent more than the 1,556 active listings for sale at the end of March 2017. 

"Despite all of the above, we continue to see benchmark price increases across our market and demand persists - partly due to low inventory - but also because of our highly desirable location," adds President Kerr. "Specific areas and price points are experiencing varying pressure on price and demand - which creates micro-markets. We are still seeing multiple offers and above asking price sales in some segments. Active buyers in our market may see some relief as inventory is slowly growing. This showcases why it is important to work with your local REALTOR® in this transitioning market to ensure you have the most up-to-date information to make purchasing and selling decisions."

The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in March 2017 was $785,600, while the benchmark value for the same home in March 2018 increased by 9.4 per cent to $859,400, higher than February's value of $840,300. The MLS® HPI benchmark value for a condominium in the Victoria Core area in March 2017 was $409,700, while the benchmark value for the same condominium in March 2018 increased by 19.6 per cent to $490,000, which is higher than February's value of $472,600.

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Greater Victoria Spring Market Update

A grand total of 8,944 properties sold over the course of 2017, 15.8% fewer than the record breaking 10,622 that sold in 2016, and 2017 sales came in at 21.7% over the ten year average of 7,349 properties sold. There were only 1,384 active listings for sale on the Victoria Real Estate Board MLS® at the end of December 2017, this is the lowest level of inventory for the area in the month of December since the statistic was tracked in 1996. 

This February 545 properties sold in the Victoria Real Estate Board region, 19.3% fewer than the 675 properties sold in February last year. "We certainly anticipated that we would see some lower numbers this year compared to last. Right now prospective home buyers are met with many hurdles as they start shopping for their new home. They're in a market that's experienced long-term low inventory, which means more price pressure and competition on homes. Buyers are navigating increasing interest rates and the new mortgage stress test. These factors all combine to constrain our market. Like any changes to consumer experience, there is a period of response before consumers adapt to the new rules. We saw an increase in buyers in November and December who bought early to avoid the mortgage stress test, and this likely means less buyers in the current market. However, with continued historical low inventory levels, demand is still outpacing supply." There were a total of 1,545 active listings for sale on the Victoria Real Estate Board MLS® at the end of February 2018, an increase of 3.6% compared to the month of January and 0.5% more than the 1,537 active listings for sale at the end of February 2017. 

The Provincial Government announced big changes to our housing and real estate industry in the BC Budget for 2018, introducing new tax legislation. The first is an annual speculation tax in the Victoria, Nanaimo, Vancouver, Fraser Valley, Kelowna and West Kelowna regions that will be levied against foreign and domestic owners, the tax rate will be 0.5% of the home's value in 2018 and increase to 2% in 2019 and following years. There are some exemptions for principal residences and qualifying long term rental properties, and the tax will be in addition to property taxes. There is still some uncertainty as to how the speculation tax will apply to domestic owners that do not reside in BC full time, or pay taxes in our province. The new tax legislation will be rolled out in the coming months with more details. Also included in the new tax legislation was a 20% foreign buyer tax for purchasers in Victoria, Nanaimo, Vancouver and other BC regions, and changes to the property transfer tax and school tax for properties over $3,000,000. 

The B.C. Government Residential Tenancy Branch announced changes to fixed term tenancies and rent increases effective December 11, 2017. The following information is from the Residential Tenancy Branch news items, for full details you can go to their news update: Landlords will no longer be able to include a “vacate” clause in a fixed-term tenancy agreement except in certain circumstances. These new rules will apply to both new and existing tenancy agreements. Unless the landlord and tenant agree to another fixed term, the tenancy will automatically continue as a month-to-month tenancy under the same terms as the original agreement. A rent increase for a tenant remaining in a rental unit is limited to the maximum annual allowable amount and can only be increased once every 12 months. Rent can no longer be increased above that amount between tenancy agreements with the same tenant. 


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Victoria Real Estate Market Adapts to Changing Policy Landscape

March 1, 2018  A total of 545 properties sold in the Victoria Real Estate Board region this February, 19.3 per cent fewer than the 675 properties sold in February last year. The sales of condominiums were down 15.5 per cent from last year in February with 174 units sold. Single family homes were 24.4 per cent down from the year previous, with 260 sold this February.

"We certainly anticipated that we would see some lower numbers this year compared to last," says Victoria Real Estate Board President Kyle Kerr. "Right now prospective home buyers are met with many hurdles as they start shopping for their new home. They're in a market that's experienced long-term low inventory, which means more price pressure and competition on homes. Buyers are navigating increasing interest rates and the new mortgage stress test. These factors all combine to constrain our market. Like any changes to consumer experience, there is a period of response before consumers adapt to the new rules. We saw an increase in buyers in November and December who bought early to avoid the mortgage stress test, and this likely means less buyers in the current market. However, with continued historical low inventory levels, demand is still outpacing supply."

There were a total of 1,545 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of February 2018, an increase of 3.6 per cent compared to the month of January and 0.5 per cent more than the 1,537 active listings for sale at the end of February 2017. 

"The provincial government recently rolled out its budget, which includes an admirable commitment to spend six billion dollars to build 114,000 units in ten years," adds President Kerr. "These units will take years to come to market, and it is difficult to predict how many we will see in Victoria. The government needs a long-term approach to supply needs in our area, and that initial commitment is a good start. A reasonable way to bolster their commitment and improve current conditions is for the province to work with our municipalities to reduce the timelines and costs associated with bringing new housing to our market."

The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in February 2017 was $771,100, while the benchmark value for the same home in February 2018 increased by 9 per cent to $840,300, slightly higher than January's value of $831,900. The MLS® HPI benchmark value for a condominium in the Victoria Core area in February 2017 was $394,400, while the benchmark value for the same condominium in February 2018 increased by 19.85 per cent to $472,600, which is slightly higher than January's value of $460,500.

 

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Victoria Real Estate Market Begins The New Year With Low Inventory And High Demand

February 1, 2018  A total of 431 properties sold in the Victoria Real Estate Board region this January, 9.8 per cent fewer than the 478 properties sold in January last year. The sales of condominiums were down 30.6 per cent from last year in January - with 118 sold. Single family homes were 4 per cent down from the previous year, with 215 selling in the first month of 2018.

"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," says 2018 Victoria Real Estate Board President Kyle Kerr. "We have yet to see the full effect of the stress test, as many people attained a 90 -120 day pre-approval before the test became required January 1. 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." 

There were a total of 1,491 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of January 2018, an increase of 7.7 per cent compared to the month of December and 1.6 per cent fewer than the 1,516 active listings for sale at the end of January 2017. 

"2017 concluded with very constrained inventory levels, which hit record lows early in January. The lack of inventory in our market is maintaining pressure on pricing, especially as high demand continues in many areas of Victoria," adds President Kerr. "We can also see the effects of headwinds influencing our market in 2018, including attempts to curb demand at all levels of government. 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. We hope the government takes a balanced approach to our housing market in their budget and offsets any further demand-side measures with initiatives aimed at addressing the ongoing supply shortages for both home buyers and renters.  We also encourage our local governments to take some time to assess the effects of demand-side measures like the mortgage stress test and recent interest rate hikes before introducing further restraints on our market." 

The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in January 2017 was $761,100. The benchmark value for the same home in January 2018 increased by 9.3 per cent to $831,900, slightly higher than December’s value of $823,800. HPI benchmark value for a condominium in the Victoria area in January 2017 was $375,300. The benchmark value for the same condo in January 2018 increased by 20.1 per cent to $450,600, which is slightly higher than December’s value of $445,000.

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Victoria Real Estate Market Strong to the End of 2017

January 2, 2018  A total of 462 properties sold in the Victoria Real Estate Board region this December, 1.9 per cent fewer than the 471 properties sold in December last year.

A grand total of 8,944 properties sold over the course of 2017, 15.8 percent fewer than the record breaking 10,622 that sold in 2016. 2017 sales came in at 21.7 per cent over the ten year average of 7,349 properties sold.

"Early in 2017 we discussed how the Victoria area housing market would be different than the record breaking year we had in 2016 and that over the course of the year we'd probably see a gradual return to a more balanced market. We did see evidence of this change come early in the year, as multiple offers and rapid price increases leveled out," says Victoria Real Estate Board President Ara Balabanian. "However, the ongoing low inventory of properties for sale meant that buyers continued to experience competitive situations in high demand areas, and multiple offers were still a common occurrence as buyers negotiated in a tighter market. What we couldn't anticipate were outside factors such as changes to mortgage qualifying rules that may have pushed people into the market early. The pending mortgage stress test in particular is likely to have caused much of the increased activity we've seen in November and December."

There were 1,384 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of December 2017, a decrease of 21.5 per cent compared to the month of November and 7.3 per cent fewer than the 1,493 active listings for sale at the end of December 2016. This is the lowest level of inventory for the area in the month of December since the statistic was tracked in 1996.

The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in December 2016 was $753,900. The benchmark value for the same home in December 2017 has increased by 9.3 per cent to $823,800, and is slightly lower than November's value of $824,600.

"Overall, the low inventory and the continued interest in Victoria real estate meant that well-priced homes were quick to sell in 2017. Moving forward, we expect to see more inventory come into the market, which will continue to move us toward a more balanced state," adds President Balabanian. "We also expect housing prices to remain stable, without the increases we tracked in 2016, and anticipate steady slow growth. In markets like these, it's important to enlist the services of a REALTOR® to help you navigate what may be your largest transaction ever."

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Greater Victoria Holiday Market Update

Our November sales count last month was the highest the Victoria Real Estate Board has tracked since 1996. A total of 671 properties sold in the Victoria Real Estate Board region this November, 12% more than the 599 properties sold in November last year, and 664 properties sold this October, 9.7% fewer than the 735 properties sold in October last year. It is rare that we see November numbers beat October numbers, but we thought some buyers may accelerate their purchase timeline to buy a new home in anticipation of the mortgage stress test on uninsured buyers. The fact that we've had an unusual month does not necessarily mean that this is the start of a new trend, it is however, a good example of how outside forces can impact a housing market. Sales in October were 17.1% above the ten year average of 567 properties for October, the market is still very active here in Victoria, and this is in spite of the ongoing low inventory levels. There were 1,764 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of November 2017, a decrease of 7.4% compared to the month of October and 2.8% fewer than the 1,815 active listings for sale at the end of November 2016. The fact that we've seen such a controlled levelling off in the market directly following a year which felt so uncontrollable in terms of demand and pressure on prices illustrates the depth and stability of the Victoria market.

Effective January 1st, 2018 mortgage borrowers with a 20% or more downpayment will have to qualify at the GREATER of the Bank of Canada posted rate (currently 4.89%) or the contract rate +2%. This decreases buying power by about 15-20% for those purchasers. The goal of OSFI is to ensure that Canadians can absorb higher payments for potential interest rate increases. Insured mortgages were hit with the stress test in the Fall of 2016. There is still one lender that will honour pre-approvals submitted before year end, these pre-approvals will allow you to qualify under the old rules for up to 8 months, so long as there’s an accepted offer in place during the pre-approved period of 120 days. An example of how stress testing will affect purchasers is if a Buyer qualifies for a mortgage of $500,000 today, with a purchase price of $625,000 and a 20% downpayment, on January 1, 2018 the same buyer will qualify for a mortgage of about $425,000, with a purchase price of about $535,000, and a 20% downpayment. 

There are some big changes coming for short term vacation rentals in Victoria, many of the details are still being fine tuned but we should know more in the new year. If you are currently operating a short term rental or planning to purchase an investment property, it is important to be aware of the cities proposed regulation changes. The proposed changes include a $2,500 annual licence fee, and although short term rentals will no longer be allowed, transient zoned buildings with units currently being operated on platforms such as Airbnb will be grandfathered in, but will lose that status if they are not operated as a short-term rental for a six-month period.

There are still places available at Chard Developments new building the Vivid on Johnson, with prices 8% under market value! If you are looking to purchase in a new development Downtown, this building is a great opportunity for purchasers with a current income of less than $150,000 and who would like to live in the home for two years after move in. Prices have now been released, contact me for more information!
  
Want to know what your home is worth? What are the new and upcoming developments around Victoria? What did that house sell for down the street? I'm always available and happy to answer your questions! 

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Victoria Real Estate Market Experiences a Burst of Activity

December 1, 2017 

A total of 671 properties sold in the Victoria Real Estate Board region this November, 12 per cent more than the 599 properties sold in November last year. 

"We suggested last month that some buyers may accelerate their purchase timeline to buy a new home in anticipation of the mortgage stress test on uninsured buyers - those with a down payment of 20 per cent or more - that will come into effect on January 1," says Victoria Real Estate Board President Ara Balabanian. "Judging by the sales we saw in November and what I have heard from our REALTOR® members, some buyers have indeed accelerated their purchasing plans to avoid the stress test. This may change the numbers we see in the early months of 2018, as some buyers who had planned to buy next year have bought a bit earlier."

There were 1,764 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of November 2017, a decrease of 7.4 per cent compared to the month of October and 2.8 per cent fewer than the 1,815 active listings for sale at the end of November 2016. 

The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in November 2016 was $748,500. The benchmark value for the same home in November 2017 has increased by 10.2 per cent to $824,600, which is slightly higher than October's value of $821,900. 

"So was this November a record breaker?" asks President Balabanian. "While not a record, it is the highest November sales count we've tracked since 1996. It is also rare that we see November numbers beat October numbers. The fact that we've had an unusual month does not necessarily mean that this is the start of a new trend, it is however, a good example of how outside forces can impact a housing market. It's likely there will be more government-led change in the new year and we'll report on the effects of those changes on the market. Our hope is that the different levels of government coordinate their efforts to avoid a negative compounding effect on the market."

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Victoria Real Estate Market Slowly Stabilizing after a Record Breaking 2016

November 1, 2017 A total of 664 properties sold in the Victoria Real Estate Board region this October, 9.7 per cent fewer than the 735 properties sold in October last year.

"As expected, we saw fewer sales than this time last year," notes Victoria Real Estate Board President Ara Balabanian. "Looking at the longer term picture however, sales last month were 17.1 per cent above the ten year average of 567 properties for the month of October, so the market is still very active here in Victoria, and this is in spite of the ongoing low inventory levels."

There were 1,905 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of October 2017, a decrease of 3.6 per cent compared to the month of September and 1.7 per cent fewer than the 1,938 active listings for sale at the end of October 2016.

The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in October 2016 was $752,000. The benchmark value for the same home in October 2017 has increased by 9.3 per cent to $821,900, but is lower than July's value of $834,200.

"The fact that we've seen such a controlled levelling off in the market directly following a year which felt so uncontrollable in terms of demand and pressure on prices illustrates the depth and stability of the Victoria market. An unstable market may have experienced a heavy correction or shift, whereas in our market sales are moderating at a reasonable rate." adds President Balabanian. "In the coming months we expect to see less inventory on the market, because the year end changes buyer and seller behaviours, their focus shifts to holidays and winter weather. One unknown influence that may play on the winter market is the upcoming mortgage stress test. Some buyers may move their purchasing timelines forward to make their home purchases before the stress test on uninsured buyers (those with a downpayment of 20 per cent or more) becomes required January 1."

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In the Fall of 2016 insured mortgages (less than a 20% down payment) were hit with the stress test, it was announced last week that conventional mortgages (20% or more down payment) will now be stress tested as well!

 

What is the mortgage stress test? 

 

It means that those mortgage borrowers with a 20% or more downpayment will have to qualify at the GREATER of the Bank of Canada posted rate (currently 4.89%) or the contract rate +2%. This decreases buying power by about 15-20% for those purchasers. The goal of OSFI is to ensure that Canadians can absorb higher payments for potential interest rate increases. 

 

Example:
Today if a client qualified for a mortgage of $500,000, that would be a purchase of $625,000 with a 20% downpayment.
On January 1, 2018 the same client would qualify for a mortgage of about $425,000, which would be a purchase price of about $535,000, with a 20% downpayment.

 

Stress testing for conventional mortgages will come into effect on January 1st, 2018, however there is still some ambiguity around exact details for dates. As it stands right now if you enter into a deal and have the lender approval prior to January 1st, 2018 you will qualify under the existing rules, even if the deal is completing in 2018. Some of these details are subject to change as more guildelines and regulations are rolled out. 

 

For more details on the impacts this could have on you and our market see the post from Spin Mortgage Here!

 

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My Greater Victoria Real Estate Market Update for the Fall is now available! 

 

As we enter Fall, Greater Victoria is seeing a consistently active real estate market, but we are very slowly inching towards more balanced conditions. A total of 640 properties sold in the Victoria Real Estate Board region this September, 18.1% fewer than the 781 properties sold in September last year. The ten year average for sales in September is 573 properties and the month still exceeded that average by more than 10%. Recently we’ve seen overall price increases level out, which can indicate slightly less demand, and inventory is building. After a small decrease and a consistent number of active listings over the Summer, there were 1,976 active listings for sale on the Victoria Real Estate Board MLS® at the end of September 2017, an increase of 3.1% compared to the month of August and 4.1% fewer than the 2,061 active listings for sale at the end of September 2016. August was the first month we've noted a decrease in HPI values since August 2015, the August HPI benchmark value for single family homes in the Victoria Core area decreased by 1.3% when compared to July, however other product such as condominiums in the Victoria Core has seen HPI values continuing to increase. We have also seen a strong focus on the lower priced end of the market, with condos, townhomes and single family homes listed for under $700,000 in high demand. Many of those properties saw multiple offer situations.

The Bank of Canada raised their interest rates for the second time in just a couple months by another 0.25% to 1%, the banks have now raised their prime lending rates to 3.20%. We could be seeing another increase this Fall, if you are thinking of buying and get a pre-approval the rates available for you at that time will be held for 90 days as you search for your new home. Last October the Canadian Government introduced "stress testing" to high ratio mortgages, less than a 20% down payment, meaning you are qualified for a mortgage at the Bank of Canada posted rate and the purchase price you qualify for is about 20% less than at our current interest rate. This may be introduced to conventional mortgages, more than a 20% down payment, in the new year, if you have any questions about how this could affect you feel free to contact me at mikaila@mikailarhodes.com or 778-679-1028.

There is an exciting new development coming to the market this Fall for home buyers that are looking to purchase in a new building Downtown. Chard Developments has announced their new building Vivid on the 800 block of Johnson St. will be priced at 8% under market value! There will be qualifications to purchase in the building such as an income of less than $150,000 and living in the home for two years after move in, they anticipate prices will be in the range of $275,000-$550,000. This is a great opportunity for first time home buyers to purchase in a quality development at a great price point!  

 

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Fall on Vancouver Island is so beautiful, and one of my favourite weekend getaways lately has been Salt Spring Island! With so much to do including local cideries, wineries, breweries, Salt Spring Island Cheese, galleries, the amazing Saturday market, exploring Ganges, and a wide variety of hikes, lakes and beaches it is the perfect place to enjoy a couple days with your favourite person!

 

To celebrate Thanksgiving and the beginning of Fall I am giving away a ONE NIGHT STAY at the Salt Spring Inn located in the Heart of Ganges, with a $40 Gift Card for Brunch! The Saturday market is even running until the last Saturday of October 

 

LIKE, SHARE & POST (for a bonus entry)

 

*Contest Rules*

 

1. “LIKE” my Facebook page Mikaila Rhodes - Real Estate Professional in Victoria
2. “SHARE” and “LIKE” the Facebook post
3. OPTIONAL for a bonus entry: “TAG” a friend you would like to spend the weekend with on Salt Spring!

 

Good luck and WINNER will be dawn October 16th!

#Giveway #RhodesRealty #ExploreVancouverIsland #yyjrealtor

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Victoria Real Estate Market Changes Tempo for Autumn

October 2, 2017  A total of 640 properties sold in the Victoria Real Estate Board region this September, 18.1 per cent fewer than the 781 properties sold in September last year.

 

“We can certainly feel the difference in the current market when we compare to last year’s record breaking numbers. Last year the pace of the market was intense, there was a lot of pressure on pricing and demand,” notes Victoria Real Estate Board President Ara Balabanian. “Now the tempo of the market is trending slowly – very slowly – towards more balanced conditions. Recently we’ve seen overall price increases level out, which can indicate slightly less demand, and inventory is building.”

 

There were 1,976 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of September 2017, an increase of 3.1 per cent compared to the month of August and 4.1 per cent fewer than the 2,061 active listings for sale at the end of September 2016.

 

The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in September 2016 was $742,200. The benchmark value for the same home in September 2017 has increased by 10.9 per cent to $823,100.

 

“Simply because we’ve seen sales drop from last year is not dire or unexpected news for our local real estate market.” adds President Balabanian. “The ten year average for sales in September is 573 properties and the month exceeded that average by more than ten per cent, which indicates we’re still in an active market. And of course there are neighbourhoods that are still tracking up in terms of value from last year. It’s for reasons like these that now more than ever it makes sense to seek the assistance of a local REALTOR® to sell or buy your home.”

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Victoria Real Estate Market Statistics for August 2017

Sept 1, 2017 - A total of 736 properties sold in the Victoria Real Estate Board region this August, 16.6 per cent fewer than the 883 properties sold in August last year. 

"I admit to being a little surprised by the August numbers," notes Victoria Real Estate Board President Ara Balabanian. "I expected inventory numbers to be climbing by now, but instead we've seen even lower numbers of listings on the market. This is likely leading to some buyer fatigue along with pressure on pricing in high demand areas."

There were 1,917 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of August 2017, a decrease of four properties compared to the month of July, and 8.5 per cent fewer than the 2,094 active listings for sale at the end of August 2016. 

The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in August 2016 was $743,200. The benchmark value for the same home in August 2017 has increased by 10.8 per cent to $823,100. 

"Though much too early to call a trend, we do see that the August HPI benchmark value for single family homes in the Victoria Core area has decreased by 1.3 per cent when compared to July. This is the first time we've noted a decrease in HPI values since August 2015." adds President Balabanian.  "That said, this is not an indicator of a huge change in property values across our region. We've seen a phenomenally busy two years in real estate for our area and we are likely heading towards a period of more balanced activity. Note too, that though the overall HPI value shows a small month over month decrease - specific areas and specific types of product have seen increases. For example, condominiums across the entire region are up by half a percent compared to the previous month and single family homes in North Saanich have increased in benchmark value by almost one per cent. It's for reasons like these that now more than ever it makes sense to seek the assistance of a local REALTOR®  to sell or buy your home."

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