Victoria Real Estate Update – Summer 2016
Greater Victoria Real Estate Summer Outlook
The BC Real Estate market has been extremely busy, and the Victoria market has experienced record sales volumes and record price increases over the last 3 months. Also, the BC Government has stepped in to intervene in the market with a number of measures that they feel will help the consumer, minimize public outcry over unaffordability in the Lower Mainland and help increase their odds of getting re-elected next year. Oh yeah, and they are also taking over the reins of regulating us realtors. We will see on all accounts, if they are successful. At this time, the verdict is still out. To say the least, a lot has transpired since my last update in the spring.
The Victoria real estate market in general, has experienced unprecedented growth in numbers and prices. The monthly sales in July hit 972, which was 22% higher than last year in July. Sale prices also reached a high of $741,100, which is 23.6% higher than 12 months ago. All of this, coupled with the fact that there are only 2100 homes listed for sale today compared to 3942 in August, 2015, can only lead to further price increase over the remainder of the year. This would be the normal prediction based on supply and demand and previous cycles.
However, the BC Government just implemented a 15% property transfer tax on homes bought by foreign buyers in the Greater Vancouver Region. This could result in a combination of effects. 1. The foreign buyers will continue to buy in the Greater Vancouver region, and will just pay the extra tax in Vancouver, which means nothing will change, and the flood of Vancouver buyers will continue to Victoria, and our market will continue to remain red hot. 2. To remain in BC, but avoid the hefty new transfer tax, the foreign buyers could look to purchase in other markets outside of the lower mainland, and choose Victoria as one new location, which would also put an extra burden on our market as we already have too low of an inventory of homes for sale. This would also result in an increase in prices in Victoria. 3. Foreign buyers may slow down their buying in BC altogether, and move to other large markets in the US or across Canada. This could then result in prices dropping in Vancouver, and slow down the number of buyers coming from Vancouver to Victoria, and our prices could as a result, start to go down. The outcome of this tax is really hard to predict, as it was just implemented this week.
Either way, in the next few months, nothing should change significantly with the Victoria real estate market other than continuing to be very busy. The continued lack of inventory and record high sales volumes will remain a factor, and should result in further price increases in most regions and in all types of properties through the fall and into 2017.
Here are a few links to various real estate sources that may be of interest to you:
1. Up-to-date real estate information on my Facebook page: VictoriaBCProperties
2. Latest Website Newsletter: Newsletter
3. Latest historical statistics from the Victoria Real Estate Board: VREBStatistics
4. Search for Victoria Properties at my website: DaleSheppard.com
All the best to you and your family, and enjoy the rest of this great summer!