2016 Was a Banner Year for Real Estate

2016 Was a Banner Year for Real Estate

NANAIMO, BC – Sales of single-family homes in December were lower than the previous month, reflecting seasonal market conditions and inventory challenges, but annual sales volume rose 24 per cent over 2015.

A total of 6,063 single-family homes sold on the Multiple Listing Service® (MLS®) in 2016, an increase of 24 per cent over the 4,885 sales recorded the previous year. VIREB’s housing market hit its peak in May, which saw 771 sales. The average sale price of a single-family home board wide increased by 13 per cent in 2016 to reach $404,695.

Inventory of single-family homes dipped to 859 in December, a historic low, down 17 per cent from November and 37 per cent from one year ago. This figure is the lowest recorded in the VIREB area since the board began tracking inventory in 1999.

The British Columbia Real Estate Association (BCREA) notes that housing demand throughout 2016 was driven by a provincial economy that outperformed the rest of the country. However, BCREA does expect the housing market to weaken somewhat this year.

“Although BCREA anticipates that less robust economic conditions combined with government policy constraints will slow housing demand by more than 15 per cent in 2017, unit sales should remain well above the 10-year average of 85,000,” says Cameron Muir, BCREA Chief Economist. “Sales in the VIREB area this year will likely trend lower than in 2016, but this is merely the market returning to more normal levels from last year’s unprecedented sales activity.”

As she has stated in previous media releases, Margo Hoffman, 2016 VIREB President, reaffirms that housing sales in the VIREB area would be higher if there were more homes available. Seasonal market conditions can account for some of December’s decreased sales, but there are still plenty of buyers, and multiple offers are the norm when listings hit the market. “We’ve been in a sellers’ market for several months now, and buyers are snapping up available properties,” says Hoffman. “But homeowners need to realize these market conditions won’t last forever, so if you’ve been thinking of selling, it’s a perfect time to do so.”

Hoffman adds that connecting with a local REALTOR® is especially crucial in a competitive housing market. REALTORS® have specialized knowledge of their communities and are equipped with sales tools, such as custom analytics, to help you develop a winning strategy for buying or selling a home.

In December 2016, the benchmark price of a single-family home in the VIREB area was $396,100, up 17 per cent from one year ago. Prices increased in every zone, ranging from nine per cent in Port Alberni to 20 per cent in Nanaimo.

The benchmark price of an apartment rose 20 per cent board-wide from the previous year, but the highest increases were posted in Parksville-Qualicum (25 per cent), the Comox Valley (26 per cent), and Campbell River (31 per cent).

The townhouse market also strengthened in December, posting high double-digit increases in every zone, from 16 per cent in Port Alberni to 20 per cent in Campbell River. The December 2016 benchmark price of a single-family home in the Campbell River area was $311,500, an increase of 17 per cent over December 2015. In the Comox Valley, the benchmark price was $396,000, up 19 per cent from 2015. Duncan reported a benchmark price of $345,000, an increase of 14 per cent compared to December 2015. Nanaimo’s benchmark price rose 20 per cent to $429,200 while the Parksville-Qualicum area saw its benchmark price rise by 18 per cent to $453,800. The price of a benchmark home in Port Alberni hit $214,700, up nine per cent from one year ago.

Inventory Dips Yet Again to Reach New Historic Low in November

FOR IMMEDIATE RELEASE December 1, 2016

Merry Christmas Everyone!

 

NANAIMO, BC – Inventory of single-family homes in the VIREB area dropped yet again in November 2016 to reach a new historic low of 1,034, a 37 per cent decrease from one year ago and dipping below October’s 1,158 available listings.

Sales of single-family homes in November decreased by 13 per cent from October 2016, but remained flat year over year, with 347 homes selling last month compared to 349 in November 2015.

The lack of sales movement can be attributed to low inventory and seasonal market conditions, not reduced buyer demand. Active listings of apartments and townhouses also dipped in November, down 45 per cent and 47 per cent respectively, an indication that consumers may be turning to alternative property types due to the lack of single-family inventory.

The British Columbia Real Estate Association (BCREA) notes that robust housing demand continues to be driven by a provincial economy underpinned by consumer confidence, surging retail sales, population growth, and a strong GDP. In its 2016 FourthQuarter Housing Forecast, BCREA reports that MLS® residential sales in the province are forecast to climb 11 per cent to a record 113,800 units this year, eclipsing the previous record of 106,310 units in 2005.

Although BCREA anticipates that less robust economic conditions combined with government policy constraints will slow housing demand by more than 15 per cent in 2017, unit sales should remain well above the 10-year average of 85,000. While the Foreign Buyer Tax imposed at the beginning of August has adversely affected the Vancouver market, there appears to be no negative fallout thus far in the VIREB area.

Foreign buyers are not turning to Vancouver Island instead of the Lower Mainland and are not the impetus driving buyer demand in the VIREB housing market, nor are the new housing rules introduced by the Government of Canada in October. The latter restrictions, intended to standardize eligibility criteria for high-ratio and lowratio insured mortgages, will have a greater impact on buyers purchasing homes in the $500,000-plus range.

VIREB’s benchmark prices on all property types are below that mark. Housing sales in the VIREB area would likely be considerably higher if there were more homes available, and buyers are frustrated by the lack of inventory.

Margo Hoffman, 2016 VIREB President, is encouraging potential home sellers to take advantage of these market conditions. “Sellers are in the driver’s seat right now, but consumers need to realize that sellers’ markets don’t last forever,” says Hoffman. “The real estate market always experiences ebbs and flows, so if you’re thinking of putting your home on the market, now is the time.” Hoffman notes that connecting with a local REALTOR® is especially crucial in a competitive market, particularly when multiple offers are the norm. REALTORS® have specialized knowledge of their communities and are equipped with sales tools, such as custom analytics, to help you develop a winning strategy for buying or selling a home.

In November 2016, the benchmark price of a single-family home in the VIREB area was $395,300, up 17 per cent from one year ago. Prices increased in every zone, ranging from 13 per cent in Port Alberni to 22 per cent in Nanaimo. The benchmark price of an apartment rose approximately 21 per cent board-wide from the previous year, but the highest increases were posted in the Comox Valley (23 per cent), Campbell River (28 per cent), and Parksville-Qualicum (31 per cent). The townhouse market also strengthened in November, posting a 15 per cent increase board-wide and ranging from 11 per cent in Port Alberni to nearly 20 per cent in Campbell River.

Nanaimo B.C. – Makes Top 5 List for Real Estate Investors

 

Along with Kamloops, Coquitlam, St. Albert, and Terrace, Nanaimo has been picked by Western Investor  as one of the top five centres in Western Canada they believe hold the most potential for real estate returns through 2017.

 

An oceanfront port city, Nanaimo has the potential to become the pressure valve for Lower Mainland housing and export growth.

Building permit values, averaging $30 million per month this year already eclipse those of larger Lower Mainland suburbs.

House prices, are a third that of those in Metro Vancouver, and fat-passenger ferry service is on the horizon to augment BC Ferries and air links to the big city.

Tourism is a growing force, with BC Ferries traffic up 6 per cent this year to 4.4 million passengers and Nanaimo air passengers up nearly 12 per cent. In August, hotel occupancy rates topped 90 per cent..

With research from Jacob Parry

Home Sales Cool in October & Inventor Dips Again

FOR IMMEDIATE RELEASE November 1, 2016 Home Sales Cool in October and Inventory Dips Again

NANAIMO, BC – In October 2016, 399 single-family homes sold on the MLS® System compared to 368 last October, an increase of eight per cent.Month over month, sales decreased by 24 per cent from September, which saw 528 unit sales. Reduced sales activity in October is likely caused by typical late-summer cooling and continuing inventory challenges.Active listings of single family homes dropped once again in October, dipping to 1,158, the lowest VIREB has seen since the board began tracking inventory levels in 1999.

Robust sales in the VIREB area and throughout much of B.C. continue to be driven by a combination of economic factors that are creating a sound foundation for housing sales.

“British Columbia’s GDP and employment growth have been above three per cent for three years now, and GDP is currently tracking at 3.5 per cent,” says Cameron Muir, BCREA Chief Economist. “Population growth is also a significant factor, with over 8,000 people migrating to B.C. from other parts of Canada in the second quarter of 2016.”

There has been a moderating trend in activity and prices occurring in Vancouver and on the Lower Mainland, with Vancouver experiencing three consecutive months of flat sales in August, September, and October. Yet Vancouver’s housing prices are still high, so many of B.C.’s new residents are settling down in the Fraser Valley or on Vancouver Island.

BCREA cannot yet determine whether the Foreign Buyer Tax imposed at the beginning of August has adversely affected the Vancouver market, nor whether the new housing rules introduced by the Government of Canada in October will have an impact. Thus far, however, there appears to be no negative fallout from any of these factors in the VIREB market. Foreign buyers are not turning to Vancouver Island instead of the Lower Mainland and are not the impetus behind VIREB’s robust housing market. As well, the federal government’s new rules that standardize eligibility criteria for high-ratio and low-ratio insured mortgages will have a greater impact on buyers purchasing homes in the $500,000-plus range. VIREB’s benchmark prices on all property types are below that mark.

Rather, the biggest challenge for the VIREB area continues to be a lack of inventory. Sales would be higher if there were were homes available, and buyer frustration is growing. Jason Finlayson, 2016 VIREB Past President, is encouraging potential home sellers to take advantage of these market conditions.

“Sellers are in the driver’s seat right now, but consumers need to realize that sellers’ markets don’t last forever,” says Finlayson. “If you’re thinking of putting your home on the market, now is the time.”

Finlayson adds that in a competitive housing market, connecting with a local REALTOR® is crucial. They have specialized knowledge of their communities and are equipped with sales tools, such as custom analytics, to help you develop a winning strategy for buying or selling a home.

In October 2016, the benchmark price of a single-family home in the VIREB area was $393,700, up 16 per cent from one year ago. Prices increased in every zone, ranging from around 13 per cent in Campbell River and Port Alberni to 19 per cent in Nanaimo and the Parksville-Qualicum area. The benchmark price of an apartment rose approximately 18 per cent board-wide, with ParksvilleQualicum reporting an increase of 33 per cent. The townhouse market also strengthened, posting a 12 per cent increase boardwide.

The October 2016 benchmark price of a single-family home in the Campbell River area was $308,900, an increase of 13 per cent over October 2015. In the Comox Valley, the benchmark price was $398,500, up 17 per cent from 2015. Duncan reported a benchmark price of $342,100, an increase of 13 per cent compared to October 2015. Nanaimo’s benchmark price rose 19 per cent to $428,500 while the Parksville-Qualicum area saw its benchmark price rise by 19 per cent as well to $449,400. The price of a benchmark home in Port Alberni hit $215,700, up 13 per cent from one year ago. 

Would you like to know if  YOUR HOME falls into these categories? Give us a call and we’ll provide you with a no obligation consultation and a FREE evaluation.

Finance Minister Announces New Mortgage Regulations

 

The Government of Canada introduced new mortgage regulations this week. These changes will make it more difficult for homebuyers to qualify for a mortgage in today’s real estate market.

Here are the new policies:

- Effective October 17, 2016 all new insured mortgages (CMHC/Genworth) must undergo a “stress Test” that will ensure a borrower has the ability to make their mortgage payments at a higher interest rate. Before these changes if you chose a fixed rate mortgage 5 years or grater the mortgage is qualified at the contract rate. Now the mortgage must qualify based on the Bank of Canada benchmark rate of 4.65%. this will lower the amount of money a client can qualify for on high ratio purchases.

Assuming an income of $40K per year and 95% financing, the maximum purchase price before October 17th is $420K and aftger October 17th is $335K.

Effective November 30, 2016, mortgages insured by lenders through portfolio insurance and other low loan-to-value ratio mortgage insurance must meet the same loan eligibility criteria as high loan-to-value insured mortgages. This affects clients who might be looking to refinance and already have equity in their homes. 

- Proposed changes to tax rules will ensure that the principal residence capital gains exemption is not abused, including by non-residents buying and selling a property in the same year.

VIREB – Inventory Levels Drop to Historic Low

FOR IMMEDIATE RELEASE September 1, 2016 Inventory Levels Drop to Historic Low in August

NANAIMO, BC – Inventory levels of single-family homes in the VIREB area dropped to a historic low in August, dipping to 1,394, a 38 per cent decrease from one year ago and down from July’s 1,577 available listings. The last time inventory was this low occurred in 2005 when the supply of single-family homes for sale dropped to 1,629 units. VIREB began tracking inventory levels in 1999.

Other market segments are also seeing reduced inventory. Active listings of apartments dropped to 391 last month from 641 in August 2015, a decrease of 39 per cent. Townhouse inventory declined by 32 per cent from one year ago.

In August 2016, 624 single-family homes sold on the MLS® System compared to 439 last August, an increase of 42 per cent. Month over month, sales of single-family homes rose slightly from July, which saw 605 unit sales. Apartment sales also increased significantly from one year ago, with 118 units selling last month, an 87 per cent increase from the 63 units sold in August 2015. More townhouses sold last month as well: 63 compared to 54 in August 2015, an increase of 17 per cent.

Robust housing sales throughout the province, particularly in the southern half, continue to be driven by a solid economic foundation consisting of consumer confidence, strong retail sales, and employment growth of three per cent. With GDP sitting at 3.5 per cent, British Columbia’s economy is leading the country.

Although a moderating trend in activity and prices is occurring in the Vancouver market, that slowdown is not affecting the VIREB area thus far. Market conditions in Vancouver and throughout the Lower Mainland appear to be experiencing some backlash from the Foreign Buyer Tax introduced at the beginning of August, although prices have not dropped significantly. Sales have taken a hit, yet it is too early to determine whether this is a temporary cooling in sales activity or indicative of a larger trend.

“Sales are beginning to normalize in the Vancouver marketplace, but we don’t anticipate a significant correction any time soon,” says Cameron Muir, BCREA Chief Economist. “The typical moderating trend seen after months of hectic activity might have been accelerated slightly by the Foreign Buyer Tax, but we just don’t know yet. We can predict many things, but not the psychology of consumers.”

Limited inventory continues to be a challenge for buyers and REALTORS® in the VIREB area, with multiple offers on accurately priced homes continuing to be the norm rather than the exception. Margo Hoffman, 2016 VIREB President, is encouraging potential home sellers to take advantage of these market conditions.

“With the number of single-family homes for sale dropping to 1,394 last month, a historic low, it’s clear that home sellers are in the driver’s seat,” says Hoffman. “But sellers’ markets don’t last forever, so if you’re thinking of selling your home, now is the time.”

Hoffman adds that in a competitive housing market, connecting with a local REALTOR® is crucial to ensure you develop a winning strategy for buying or selling your home.

In August 2016, the benchmark price of a single-family home in the VIREB area was $384,000, up 13.23 per cent from one year ago. Prices increased in every zone, ranging from nine per cent in Port Alberni to 16 per cent in Nanaimo and 17 per cent in the Parksville-Qualicum area. The benchmark price of an apartment rose approximately 15 per cent board-wide, with Duncan and Parksville-Qualicum reporting 25 and 23 per cent increases, respectively. The townhouse market also strengthened, as seen in the benchmark price increasing by 10.63 per cent.

The August 2016 benchmark price of a single-family home in the Campbell River area was $304,200, an increase of 10.41 per cent over August 2015. In the Comox Valley, the benchmark price was $380,200, up 12 per cent from 2015. Duncan reported a benchmark price of $333,800, an increase of 11.30 per cent compared to August 2015. Nanaimo’s benchmark price rose 15.80 per cent to $413,500 while the Parksville-Qualicum area saw its benchmark price rise by 17 per cent to $443,500. The price of a benchmark home in Port Alberni was $209,500, up nine per cent from one year ag

VIREB Market Update August 2016

August 2, 2016 Home Sales a Bit Cooler in July But Significantly Higher Than Last Year

NANAIMO, BC – Home sales in the VIREB area cooled somewhat last month but posted a 19 per cent increase over July 2015.

In July 2016, 608 single-family homes sold on the MLS® System compared to 512 last July. Month over month, sales decreased by 15 per cent from the 712 sales processed in June 2016. Last month’s active listings for single-family homes totalled 1,577, down 34 per cent from the 2,391 reported in July 2015 and beating June’s figure of 1,621.

This is a historic low for VIREB, which began tracking inventory levels in 1999. The last time inventory was this low occurred in 2005 when the number of single-family homes for sale dropped to 1,629.

Economic factors fueling the provincial housing market are strong consumer confidence, robust retail sales, and high employment growth. With GDP sitting at 3.5 per cent, British Columbia’s economy continues to lead the country. Concerning the new Foreign Buyer Tax that takes effect today, Muir says it is too early to know whether it will affect home prices on the Lower Mainland or spill over into other parts of the province.

“The housing market is usually slower in the summer months, but we believe that sales might be beginning to normalize,” says Cameron Muir, BCREA Chief Economist. “If so, that would allow inventory to build up and ease pricing pressure a bit.”

Margo Hoffman, 2016 VIREB President, agrees that the housing market typically cools during the summer, and this trend likely accounts for July’s lower sales figures. However, limited inventory continues to be a challenge for buyers and REALTORS®.

“Although we’re in a seller’s market, homeowners are holding back because they’re worried they won’t find another home to purchase,” says Hoffman. “We’re beginning to see more inventory, but buyers snap up available properties quickly.”

Low inventory is also contributing to rising benchmark prices for single-family homes, townhouses, and apartments. Despite those increases, however, the Vancouver Island housing market continues to be affordable compared to the Lower Mainland and Victoria.

“Home buyers in the VIREB area have a variety of price points as options,” adds Hoffman. “The benchmark price of a singlefamily home ranges from a low of $209,600 in Port Alberni to a high of $443,800 in the Parksville-Qualicum area, so there is a price to suit almost everyone.”

Hoffman agrees that at the moment, there is no way to say whether the Foreign Buyer Tax will affect home prices in the VIREB area. For now, the housing market remains competitive, so connecting with a local REALTOR® is crucial to ensure you develop a winning strategy for buying or selling your home.

In July 2016, the benchmark price of a single-family home in the VIREB area was $379,900, up just under 12 per cent from one year ago. The benchmark price of an apartment rose by 9.77 per cent to hit $207,900 while the benchmark price of a townhouse increased to $277,900, up just over 10 per cent from one year ago. Benchmark pricing tracks the value of a typical home in the reported area. The average price of a single-family home last month was $409,816, an increase of 12 per cent over July 2015.

The July 2016 benchmark price of a single-family home in the Campbell River area was $301,400, an increase of 5.57 per cent over July 2015. In the Comox Valley, the benchmark price was $371,000, up 10.68 per cent from 2015. Duncan reported a benchmark price of $326,700, an increase of just over nine per cent compared to July 2015. Nanaimo’s benchmark price rose 15.46 per cent to $409,700 while the Parksville-Qualicum area saw its benchmark price rise by 17 per cent to $443,800. The price of a benchmark home in Port Alberni was $209,600, up 7.86 per cent from one year ago.

Hot Housing Market Puts Sellers in Driver’s Seat

VIREB – FOR IMMEDIATE RELEASE June 1, 2016 Hot Housing Market Puts Home Sellers in Driver’s Seat

 

NANAIMO, BC – Home sellers are in the driver’s seat throughout the VIREB area as buyers compete for available listings.

In May 2016, 771 single-family homes sold on the MLS® System compared to 527 last May, an increase of 46 per cent. Month over month, sales were up by 17 per cent from the 660 sales processed in April 2016. Last month’s active listings totalled 1,684, down 32 per cent from the 2,507 reported in May 2015.

Cameron Muir, BCREA Chief Economist, states that retail sales growth in the double digits reflects high levels of consumer confidence, which is spilling over into real estate. Tourism on Vancouver Island also posted a huge spike recently, which aids local economic conditions. However, although housing demand is extraordinarily high, its foundation is solidly based on a healthy GDP and rising population growth.

“British Columbia’s GDP is at three per cent, and employment growth rose around 3.5 per cent in the first four months of 2016,” says Muir. “Real estate is benefiting from that growth, with sales in the entire southern half of the province at record or near-record levels.”

Janice Stromar, VIREB 2016 President-Elect, confirms that the VIREB housing market is recording record sales in many areas. Multiple offers, particularly on single-family homes, are the norm rather than the exception. Low inventory levels are still a major challenge for REALTORS® and buyers for a variety of reasons.

“This is a fantastic time to sell, but some homeowners have been holding back because they love their home or are worried they won’t find another property to buy,” says Stromar. “More houses are now coming onto the market, but buyers snap them up so quickly, we still don’t have enough inventory to satisfy the demand.”

Despite increases in both the benchmark and average prices over the past year, the Vancouver Island housing market is still an affordable alternative to Victoria and Lower Mainland communities.

“Although retirees frequently choose to migrate to Vancouver Island, we are seeing younger professionals trading in their homes on the Lower Mainland for a significantly nicer property here,” says Stromar. “I wouldn’t call it a trend, but it’s becoming more common if people can find jobs on the Island or telecommute to jobs on the Lower Mainland all or part of the time.”

Stromar adds that in a competitive housing market, connecting with a local REALTOR® is crucial to ensure you develop a winning strategy for buying or selling your home.

In May 2016, the benchmark price of a single-family home in the VIREB area was $364,500, up 9.36 per cent from one year ago. Benchmark pricing tracks the value of a typical home in the reported area. The benchmark price of townhouses and apartments also increased in nearly every market. The average MLS® price of a single-family home in May was $411,458, a 13 per cent increase from May 2015.

The May 2016 benchmark price of a single-family home in the Campbell River area was $287,500, a 3.27 per cent increase over 2015. In the Comox Valley, the benchmark price was $360,400, up 11.32 per cent from 2015. Duncan reported a benchmark price of $317,300, an increase of 6.71 per cent over the same month in 2015. Nanaimo’s benchmark price rose 10.82 per cent to $389,800 while the Parksville-Qualicum area saw its benchmark price rise by 14.31 per cent to $417,900. The price for a benchmark home in Port Alberni was $197,300, unchanged from one year ago.

 

Buyer Demand Continues to Outpace Supply in the VIREB Area

May 2, 2016 Buyer Demand Continues to Outpace Supply in the VIREB Area

NANAIMO, BC – The VIREB housing market is firmly in seller’s territory, with buyer demand continuing to outpace supply in most areas.

 

In April 2016, 662 single-family homes sold on the MLS® System compared to 449 last April, an increase of 47 per cent. Month over month, sales were up by 27 per cent from the 520 sales processed in March 2016. Last month’s active listings totalled 1,697, down 26 per cent from the 2,305 reported in April 2015.

Cameron Muir, BCREA Chief Economist, states that the hot housing market continues to be fuelled by strong consumer demand. Buyers are aggressively pursuing home purchases, with multiple offers the norm rather than the exception throughout British Columbia.

Real estate boards in the Lower Mainland, Chilliwack, Kamloops, the Okanagan, Victoria, and Vancouver Island are all reporting robust market conditions, with some areas posting record-breaking sales. Underpinning B.C.’s vibrant economy and strong demand for housing is employment growth of three per cent, the highest in Canada.

“Although these market conditions cannot continue indefinitely, there is just no sign of any slowdown,” says Muir. “Whether we’ll be reporting the same level of housing activity come September remains to be seen.”

VIREB President Margo Hoffman says that REALTORS® are busier than they have been in years, and multiple offers – particularly on single-family homes – are everyday occurrences. As stated in previous media releases, lack of inventory continues to be the major challenge for REALTORS® and buyers.

“The thing to remember about busy markets like we’re seeing is that they never last forever,” says Hoffman. “If homeowners are thinking of selling, this is an ideal time to do so.

” Although the benchmark and average prices have risen over the past year, Hoffman notes that the VIREB market is still very affordable compared to Victoria and Lower Mainland communities. Whether you are a buyer or seller, Hoffman also adds that a REALTOR® is a vital partner in the sales process to ensure you price your home appropriately for selling and pay the right price when buying.

In April 2016, the benchmark price of a single-family home in the VIREB area was $356,700, up 8.36 per cent from one year ago. Benchmark pricing tracks the value of a typical home in the reported area. The benchmark price of townhouses and apartments also increased in nearly every market. The average MLS® price of a single-family home in April was $396,165, a nine per cent increase from April 2015.

The April 2016 benchmark price of a single-family home in the Campbell River area was $284,600, a 4.09 per cent increase over 2015. In the Comox Valley, the benchmark price was $357,700, up 10.34 per cent from 2015. Duncan reported a benchmark price of $313,400, an increase of 6.65 per cent over the same month in 2015. Nanaimo’s benchmark price rose 9.08 per cent to $379,300 while the Parksville-Qualicum area saw its benchmark price rise by 10.69 per cent to $399,500. The price for a benchmark home in Port Alberni was $191,600, an increase of 1.42 per cent over April 2015