Market Insight Series – May 2023 - Tools for Productivity and Success

What does the current Victoria real estate market look like?

As part of our monthly Market Insight Series, I am excited to continue to bring you regular insights into Victoria and Vancouver Island market trends, so you can make better buying and selling decisions. Below I will jump into the most important market numbers to look into, I will provide glossary term definitions, and will conclude with resources if you want to further research current trends and stats. If you want to see what the Market Insight for the previous month was click here.

Hey folks, it’s John here and today we’re talking about changing real estate trends in Victoria. The latest numbers are in and they show that 637 properties were sold in April, which is down 22.7% from the same time last year. However, that’s an 8% increase from March 2023, which is good news.

But let’s take a closer look. Sales of condos are down 21.8% from last year with only 205 units sold, and sales of single-family homes have decreased by 19.4% with only 325 sold. That’s a big drop in sales, but it’s not surprising given the low inventory levels. There were only 2,043 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of April 2023. That’s not a lot of homes to go around for a population of approximately 423,000 in the Greater Victoria Area! However, we are still moving in the right direct, as current listings are up 3.7% from March, and a whopping 49.7% increase from the same time last year.

According to Victoria Real Estate Board Chair Graden Sol, we’re in a familiar market pattern where the majority of sales occur in the spring. But the low inventory levels and a slow pace of new properties coming onto the market means that we need more inventory to balance supply against demand. The good news is that prices have stabilized, for now. But if listings don’t pick up this season, there’s a risk that price stabilization could turn, and we could see prices increase.

Now, let’s talk about what really matters for buyers and sellers. The Multiple Listing Service® Home Price Index benchmark value for a single-family home in the Victoria Core was $1,424,900 in April 2022. However, this April, the benchmark value for the same home decreased by 11.3% to $1,264,200, which is up from March’s value of $1,236,200. And for condominiums, the benchmark value in the Victoria Core area was $630,200 in April 2022, while this April, the benchmark value decreased by 10.3% to $565,000, which is up from March’s value of $560,300.

Now, what does all of this mean? Well, the drop in sales and the increase in inventory mean that buyers have more options and a little more bargaining power compared to before. On the other hand, sellers may have to adjust their expectations and be prepared to wait a little longer for a sale. But overall, consumer confidence in the market has returned, and accurately priced homes are still selling quickly and close to the list price. In fact, in some cases, some strategically priced homes are starting to receive multiple offer competition. Although, the market bottom could be just setting in, if low inventory and growing demand continue to persist prices are likely to start climbing again quickly. We are already starting to see a small bump in price across most property types compared to last month’s data.

As I’ve forecasted for some time now, with the bottom setting in, those who are thinking about buying will probably want to jump in now if possible. However, if you’re thinking about selling, or downsizing then you’re probably better off waiting for the time being.

So, if you’re thinking of buying or selling in the Victoria region this spring, make sure to work with a reputable REALTOR® who can help you navigate the pulse of the market and find the right deal for you. Thanks for tuning in, and until next time, keep your eyes on those real estate numbers.

Below is a table that outlines the current housing benchmark pricing along with a sample calculation that can give you an idea of what it might cost you to own a home.Opportunities for ordinary people looking to get into their first home, or move up into an affordable nicer home are still out there, it just takes a bit of diligence, and ideally the support of a committed agent.

Conclusion

The goal is to give you insight into what the overall market view looks like in Victoria and Vancouver Island. I have included more Resources below so that you can dive in and read more at your leisure. I will also make sure to include a new Glossary Term each month, and define it to add to your knowledge of common industry terms.

Feel free to contact me if you want to learn more or if you have any questions about the broader market trends.

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Glossary Term

Condominium

Typically what most people think of when it comes to a strata property. Condominiums like all other stratas are governed by their own set of bylaws and collect a monthly strata fee to maintain the common property. This includes things exterior to your unit like the building exterior, siding, windows, elevator, parkade, shared amenities, etc. It also includes limited common property such your balcony and railings. Property exterior to your unit that is commonly owned and managed, but that you have exclusive access to. Condominiums are great if want a property that requires minimal time investment to manage and take care of.

https://www.investopedia.com/terms/c/condominium.asp

Resources

1. VREB Insight:

https://www.vreb.org/current-statistics#gsc.tab=0

2. Mortgage Calculator:

https://www.cchwebsites.com/content/calculators/CAMortgageLoan.html

3. Mortgage Rate By Bank:

https://www.rbcroyalbank.com/mortgages/mortgage-rates.html

https://www.td.com/ca/en/personal-banking/products/mortgages/mortgage-rates/

https://www.bmo.com/main/personal/mortgages/mortgage-rates/

https://www.scotiabank.com/ca/en/personal/rates-prices/mortgages-rates.html

https://www.cibc.com/en/interest-rates/mortgage-rates.html