Prices Continue Rising Despite Moderating Sales

 

NANAIMO, BC – Sales of single-family homes in October were 11 per cent higher than in September but dipped by 16 per cent from October 2017.

Last month, 385 single-family homes sold on the Multiple Listing Service® (MLS®) System compared to 347 in September and 458 one year ago. The number of apartments and townhouses changing hands last month dropped by eight and 21 per cent, respectively.

This year’s housing market is behaving as expected, moderating after the record-setting pace set in 2016 and 2017. Government policy-side measures introduced to cool the market, such as the mortgage stress test (Guideline B-20) and higher interest rates, are taking their toll on housing sales throughout the country.

On the positive side, the provincial economy is still doing well, and the British Columbia Real Estate Association expects housing sales to make a modest recovery during the next couple of quarters. Further, Vancouver Island has so far been somewhat immune to the effects of Guideline B-20 because the broad demographic trend in our area includes baby boomers and retirees who do not typically need mortgages.

However, an additional government policy that could reduce that insulating effect is the future speculation tax. Although it currently applies only to Nanaimo and Lantzville, the tax could discourage some potential buyers from relocating to Vancouver Island, particularly those who purchase a home well ahead of retirement.

Despite lower demand, prices in the VIREB area are still rising year over year. However, the board-wide benchmark price of a single-family home did drop slightly from September, and modest month-over-month price reductions on single-family homes, apartments, and townhouses did occur in several zones.

Decreased demand and stabilizing inventory are helping VIREB’s long-term sellers’ market evolve into one that is more balanced. Inventory of single-family homes in October was up slightly from one year ago (1,175 compared to 1,138) but down eight per cent from September. There were 322 active listings of apartments in October, up seven per cent from 2017 while the supply of townhouses rose by 28 per cent year over year. Multiple offers have slowed, and buyers are taking more of a wait-and-see approach, which means some sellers will have to curb their expectations.

“Realistically pricing your home is important in any market, but when fewer buyers are competing for a property, sellers need to be prudent when determining a sale price,” says Don McClintock, 2018 VIREB President. “Overpriced homes take longer to sell, so it’s a good idea to consult a local REALTOR® who can help determine the optimal price for your property.”

The benchmark price of a single-family home board-wide was $508,200 in October, an 11 per cent increase from one year ago. (Benchmark pricing tracks the value of a typical home in the reported area.) In the apartment category, the benchmark price climbed to $313,500, up 16 per cent from last year. The benchmark price of a townhouse hit $411,800 last month, up 13 per cent over October 2017.

Last month, the benchmark price of a single-family home in the Campbell River area hit $408,100, an increase of 14 per cent over October 2017. In the Comox Valley, the benchmark price reached $501,400, up nine per cent from last year. Duncan reported a benchmark price of $475,700, up 12 per cent from October 2017. Nanaimo’s benchmark price rose nine per cent to $548,000 while the Parksville-Qualicum area saw its benchmark price increase by nine per cent to $570,200. The cost of a single-family home in Port Alberni rech $300,300, up 18 per cent from one year ago.

VIREB Sales Bounce Back Slightly From July But Still Lower Than in 2017

SEPTEMBER, 2018 NANAIMO, BC – Sales of single-family homes in August were seven per cent higher than in July but dipped by 14 per cent from August 2017.

Last month, 467 single-family homes sold on the Multiple Listing Service® (MLS®) System compared to 438 in July and 540 one year ago. The number of apartments changing hands last month dropped by 13 per cent while townhouse sales increased by 16 per cent.

Inventory of single-family homes in August was down slightly from one year ago (1,342 compared to 1,352), dropping five per cent from July but still significantly higher than the 749 properties available in January. The supply of apartments and townhouses dipped 14 per cent and 10 per cent from one year ago, respectively.

The weaker sales seen so far in 2018 were expected because 2016 and 2017 were exceptionally healthy years for real estate, setting record levels that could not be maintained indefinitely. However, VIREB’s housing market is still strong compared to where it sat four years ago.

“The broad demographic trend for the VIREB area continues to include baby boomers and retirees, who are less affected by stricter mortgage qualification rules because they don’t typically need mortgages,” says Cameron Muir, chief economist for the British Columbia Real Estate Association (BCREA). “As a result, even when sales bottom out, they’re doing so at lower levels on Vancouver Island.”

In its 2018 Second-Quarter Housing Forecast, BCREA anticipates that MLS® residential sales in the province will decline by nine per cent to 94,200 units this year from 103,700 in 2017.

“B.C. housing markets have benefited from the provincial economy expanding well above trend growth over the past four years,” says BCREA chief economist Cameron Muir. “However, economic growth is expected to slow and reflect the long term average this year.”

VIREB’s long-term sellers’ market does appear to be moving towards more balanced conditions. The benchmark price of a single-family home for the overall board area posted its first significant drop this year, with modest price reductions also occurring in Campbell River, Duncan, and Parksville-Qualicum Beach. Multiple offers are not as frequent, but for homes in the $300,000 to $500,000 range, they are still more common than not. That said, sellers still need to price their homes accordingly. Today’s buyers are savvy and well-informed when they arrive at the negotiating table.

“Sellers need to be realistic when it comes to price,” says Don McClintock, 2018 VIREB President. “Not every property is worth a million dollars, and overpriced homes just take longer to sell.”

The benchmark price of a single-family home board-wide was $505,800 in August, a 12 per cent increase from one year ago but down from June’s $510,300 and July’s $510,700. (Benchmark pricing tracks the value of a typical home in the reported area.) The benchmark price of an apartment last month was $317,700, up 20 per cent from one year ago. In the townhouse category, the benchmark price hit $413,600, up 15 per cent over August 2017.

Last month, the benchmark price of a single-family home in the Campbell River area was $404,300, an increase of 12 per cent over August 2017. In the Comox Valley, the benchmark price reached $509,200, up 13 per cent from last year. Duncan reported a benchmark price of $455,100, up eight per cent from August 2017. Nanaimo’s benchmark price rose 10 per cent to $546,200 while the Parksville-Qualicum area saw its benchmark price increase by 13 per cent to $574,200. The cost of a benchmark home in Port Alberni reached $303,600, up 22 per cent from one year ago.

Prices Continue to Sizzle in Summer Housing Market

 

 

NANAIMO, B.C. – family homes, apartments, and townhouses continue to rise in the VIREB area despite cooling sales in some markets.

Last month, 437 single-family homes sold on the Multiple Listing Service® (MLS®) System compared to 438 in June and 556 one year ago, a decrease of 21 per cent. The number of apartments changing hands last month was virtually the same as July 2017 (100 compared to 101), but in the townhouse category, sales dropped by nine per cent.

Housing demand in the VIREB area has shifted lower so far in 2018, likely due to stricter mortgage qualification rules (Guideline B-20) for conventional borrowers and rising interest rates that are taking their toll on household purchasing power and affordability. However, because many of our buyers are retirees, who do not typically need mortgages, the VIREB market has been somewhat sheltered from the effects of Guideline B-20.

In its 2018 Second-Quarter Housing Forecast, the British Columbia Real Estate Association (BCREA) anticipates that MLS® residential sales in the province will decline by nine per cent to 94,200 units this year from 103,700 in 2017.

“B.C. housing markets have benefited from the provincial economy expanding well above trend growth over the past four years,” says BCREA chief economist Cameron Muir. “But economic growth is expected to slow and reflect the long-term average this year.”

On a local level, BCREA predicts that over the next several months, VIREB’s long-term sellers’ market will begin shifting towards a more balanced one. In fact, an interesting development in the VIREB area is that the market seems to be splitting into two in some communities: one that favours sellers for homes $600,000 and under, and a buyers’ market for more expensive properties.

However, even with the high demand for lower-priced properties, sellers still need to price their homes accordingly.

“Sellers need to be realistic when it comes to price,” says Kaye Broens, 2018 President-Elect. “Overpriced homes simply take longer to move.”

Connecting with a local REALTOR is beneficial in both buyers’ and sellers’ markets, adds Broens.

“REALTORS® have specialized knowledge of their communities and can help streamline the buying and selling process to ensure the best possible outcome for our clients,” says Broens.

The benchmark price of a single-family home in the VIREB area reached $510,700 in July, a 12 per cent increase from one year ago. (Benchmark pricing tracks the value of a typical home in the reported area.) The benchmark price of an apartment last month was $315,900, a 22 per cent increase over last July. In the townhouse category, the benchmark price hit $413,100, up 17 per cent over July 2017.

Last month, the benchmark price of a single-family home in the Campbell River area climbed to $426,300, an increase of 18 per cent over July 2017. In the Comox Valley, the benchmark price reached $513,400, up 13 per cent from last year. Duncan reported a benchmark price of $446,700, down slightly from June but up 10 per cent from July 2017. Nanaimo’s benchmark price was $534,300, the same as June but a nine per cent increase from one year ago. The Parksville-Qualicum area saw its benchmark price increase by 14 per cent to $579,500. The cost of a benchmark home in Port Alberni was $289,200, a slight decrease from June but up 16 per cent from one year ago.

VIREB – Home Sales Cooling But Prices Still Rising

 

WELCOME SUMMER!

 

NANAIMO, BC – Last month, 444 single-family homes sold on the Multiple Listing Service® (MLS®) System compared to 518 in May and 617 one year ago. The number of apartments changing hands last month dropped by 21 per cent, but in the townhouse category, sales increased by 26 per cent.

Housing demand in the VIREB area has shifted lower in the first half of 2018 as stricter mortgage qualifications for conventional borrowers and rising interest rates took their toll on household purchasing power and affordability. It is unclear whether the June slowdown is reflective of seasonal summer market conditions or if demand-side policy changes are finally beginning to play a larger role in VIREB’s housing market.

Despite lower sales thus far in 2018, lack of inventory continues to tilt the market in favour of sellers and push prices upwards. The number of single-family homes for sale has been slowly increasing, hitting 1,336 in June, up only three per cent from May but a significant increase from the 893 properties available in January. The supply of townhouses rose by 33 per cent from one year ago, but many of the listings behind these modest inventory gains in both property types are being quickly snapped up by buyers.
In its 2018 Second-Quarter Housing Forecast, the British Columbia Real Estate Association (BCREA) anticipates that MLS® residential sales in the province will decline by nine per cent to 94,200 units this year from 103,700 in 2017.
“B.C. housing markets have benefited from the provincial economy expanding well above trend growth over the past four years,” says BCREA chief economist Cameron Muir. “However, economic growth is expected to slow and reflect the long-term average this year.”
On a local level, BCREA predicts that over the next eight months, VIREB’s long-term sellers’ market will begin shifting towards more balanced conditions. Further, the pace of price increases will slow if demand keeps declining, but it is unlikely that prices will drop until additional inventory enters the market by way of new construction or buyer appetite decreases drastically.
In the meantime, competition for homes – especially in the $300,000 to $500,000 range – is still modus operandi in the VIREB area, with multiple offers a commonplace occurrence on properties in that price range. Despite buyer demand, however, homes at most price points still need to be reasonably priced.
“For sellers, properly pricing your home remains an important factor,” says Don McClintock, 2018 VIREB President. “Buyers are savvy, and overpriced homes take longer to sell.
Connecting with a local REALTOR® is especially crucial in a competitive housing market.
“REALTORS® have specialized knowledge of their communities and can help streamline the buying and selling process to ensure the best possible outcome for our clients,” says McClintock.
The benchmark price of a single-family home in the VIREB area reached $510,300 in June, a 15 per cent increase from one year ago. (Benchmark pricing tracks the value of a typical home in the reported area.) The benchmark price of an apartment last month was $313,300, a slight decrease from May but a 24 per cent increase over last June. In the townhouse category, the benchmark price hit $405,000, up 18 per cent over June 2017.

Last month, the benchmark price of a single-family home in the Campbell River area climbed to $425,800, an increase of 22 per cent over June 2017. In the Comox Valley, the benchmark price reached $510,700, up 17 per cent from last year. Duncan reported a benchmark price of $450,500, up 12 per cent from June 2017. Nanaimo’s benchmark price rose 11 per cent to $534,300, down slightly from May, while the Parksville-Qualicum area saw its benchmark price increase by 16 per cent to $575,800. The cost of a benchmark home in Port Alberni reached $293,800, up 22 per cent from one year ago.

VIREB – Single-Family Benchmark Price Surpasses $500,000 in May

 

NANAIMO, BC – The benchmark price of a single-family home in the VIREB area broke the $500,000 mark in May, rising to $507,700, a 17 per cent increase from one year ago. Sales of single-family homes were down 17 per cent from last year but posted a month-over-month increase of nine per cent.

Last month, 520 single-family homes sold on the Multiple Listing Service® (MLS®) System compared to 476 in April and 630 one year ago. The number of apartments and townhouses changing hands in May dropped by six per cent and 11 per cent, respectively.

VIREB’s inventory of single-family homes continues to climb, rising from 749 in January 2018 to 1,215 in May. The supply of apartments dropped slightly last month, down six per cent from one year ago, but townhouse inventory rose significantly.

In its 2018 Second-Quarter Housing Forecast, the British Columbia Real Estate Association (BCREA) anticipates that MLS® residential sales in the province will decline by nine per cent to 94,200 units this year from 103,700 in 2017.

“B.C. housing markets have benefited from the provincial economy expanding well above trend growth over the past four years,” says BCREA chief economist Cameron Muir. “However, economic growth is expected to slow and reflect the longterm average this year.”

Housing demand in the VIREB area shifted lower in the first four months of 2018 as stricter mortgage qualifications for conventional borrowers took their toll on household purchasing power and affordability. Other economic headwinds that could dampen demand include higher interest rates and new provincial taxes. However, the attractiveness of Vancouver Island to retirees and millennials is expected to mitigate their impact somewhat.

Despite lower sales thus far in 2018, lack of inventory continues to tilt the market in favour of sellers and push prices upwards. The pace of these increases could slow somewhat if demand keeps declining, but it is unlikely that prices will drop until additional inventory enters the market by way of new construction.

“Housing starts are up on Vancouver Island, particularly in Nanaimo, so there is some relief on the horizon,” says Janice Stromar, 2018 Past President. “However, in the multi-family category, the time between conception and completion can take several years, which doesn’t help people looking to buy now.”

Since limited inventory is keeping the VIREB area in a sellers’ market, competition for homes – especially in the $300,000 to $500,000 range – means buyers and sellers should strongly consider using a REALTOR®, says Stromar.

“As experienced professionals, we can help streamline the buying and selling process to ensure the best possible outcome while reducing associated risks,” says Stromar.

As noted above, the benchmark price of a single-family home in the VIREB area reached $507,700 in May, a 17 per cent increase from one year ago. (Benchmark pricing tracks the value of a typical home in the reported area.) The benchmark price of an apartment last month rose to $314,000, up 25 per cent board-wide from the previous year, while the benchmark price of a townhouse hit $397,100, an 18 per cent increase from May 2017. Last month, the benchmark price of a single-family home in the Campbell River area climbed to $417,500, an increase of 20 per cent over May 2017.

In the Comox Valley, the benchmark price reached $500,500, up 17 per cent from last year. Duncan reported a benchmark price of $450,700, an increase of 15 per cent compared to May 2017. Nanaimo’s benchmark price rose 14 per cent to $538,500 while the Parksville-Qualicum area saw its benchmark price increase by 17 per cent to $575,000. The cost of a benchmark home in Port Alberni reached $294,900, up 27 per cent from one year ago.

VIREB – Sales Holding Steady Amid Rising House Prices

 – Sales of single-family homes in the VIREB area rose by 20 per cent month over month in April but remained static from one year ago. Last month, 476 single-family homes sold on the Multiple Listing Service® (MLS®) System compared to 398 in March and 476 one year ago.

The number of apartments changing hands in April decreased by six per cent year over year while townhouse sales rose by 26 per cent.

VIREB’s inventory of single-family homes climbed by eight per cent from March 2018 but decreased by six per cent from one year ago. The supply of apartments dropped in April, down 12 per cent from one year ago, but townhouse inventory rose by 30 per cent.

The British Columbia Real Estate Association (BCREA) reports that housing sales in many B.C. jurisdictions are down compared to last year. Guideline B-20 and uncertainty surrounding new provincial taxes appear to be taking their toll on sales in some markets.

Broadening the scope of the Foreign Buyer Tax to include the Regional District of Nanaimo (RDN) should not have a significant impact on the VIREB housing market. Only 4.4 per cent of RDN residential real estate transactions in 2017 involved foreign buyers. More troubling is the new speculation tax, which is supposed to be implemented later this year. The tax will apply to Nanaimo and Lantzville, but it will take a few months to see whether it has a detrimental impact on sales.

BCREA also expects the Bank of Canada to increase interest rates in the next couple of months, which introduces another risk factor into the housing market.

For now, however, demand is still outpacing supply in the VIREB area, particularly in some price ranges. Properties in the $300,000 to $500,000 range generate multiple offers and sell quickly.However, higher-priced homes are taking longer to sell.

Janice Stromar, 2018 Past President, encourages sellers to take advantage of our current market conditions before any economic headwinds weaken demand.

“Our market has favoured sellers for a long time now, but it won’t last forever,” says Stromar. “However, even in a sellers’ market, you need to price your home correctly because overpriced homes take longer to sell.”

In a competitive housing market, using a REALTOR® can help streamline the buying and selling process to ensure the best possible outcome while mitigating associated risks, adds Stromar.

“REALTORS® are equipped with sales tools, such as custom analytics, to help buyers prepare winning offers and ensure sellers receive the best price for their home,” says Stromar.

In April 2018, the benchmark price of a single-family home in the VIREB area reached $499,600, up 18 per cent from one year ago. (Benchmark pricing tracks the value of a typical home in the reported area.) The benchmark price of an apartment last month rose to $305,300, up 25 per cent board-wide from the previous year, while the benchmark price of a townhouse hit $393,200, a 22 per cent increase from April 2017.

Last month, the benchmark price of a single-family home in the Campbell River area climbed to $410,000, an increase of 22 per cent over April 2017. In the Comox Valley, the benchmark price reached $487,100, up 17 per cent from last year. Duncan reported a benchmark price of $444,700, an increase of 17 per cent compared to April 2017. Nanaimo’s benchmark price rose 16 per cent to $537,800 while the Parksville-Qualicum area saw its benchmark price increase by 18 per cent to $562,800. The cost of a benchmark home in Port Alberni reached $282,000, up 24 per cent from one year ago.

Such Kind Words

March 18, 2017

Hello Ron and Peggy,

Now that we have happily moved into our new home we’d be remiss in not thanking you for the way you helped us make our dream come true.  We were impressed by your professionalism in all your dealings with us, starting from the thorough introduction to selling a house, the research of current market values, and the expertly done picture gallery and brochure which attracted many potential buyers.  But above all, we appreciated Ron’s quiet and reassuring demeanor in the somewhat stressful situation of selling our beloved property.  And we were equally appreciative of Peggy’s never failing accessibility for any queries we had and her prompt follow-up.  It doesn’t take you long to realize that Ron and Peggy work hand-in-glove and make a very successful team in helping their clients achieve their goals.

Lastly, we are still in awe, and thankful, at how quickly you were able to secure our new home in a highly competitive situation.  Ron and Peggy, you stopped at nothing and dedicated extra hours to see us through the process.  And if that were not enough, you helped us get started on the move.  All in all, we couldn’t be happier with the service you have given us and we would certainly recommend you to any potential clients. 

Yours gratefully, Richard and Marlies Newton

VIREB 2017 REALTORS Care® Award

It was with great honour and pride that Ron accepted the Vancouver Island Real Estate Board’s 2017 REALTORS Care® Award yesterday. One of the highest honours VIREB can bestow upon its members, a REALTORS Care® Award recognizes REALTORS® who give back and improve the quality of life in their communities. We’re all so proud of you Ron. 

Buoyant Sellers’ Market Continues

VIREB – Vancouver Island Real Estate Board

FOR IMMEDIATE RELEASE March 1, 2018

WELCOME MARCH!

NANAIMO, BC – Last month, 316 single-family homes sold on the Multiple Listing Service® (MLS®) System compared to 288 in January and 345 one year ago. The number of apartments changing hands in February rose by 28 per cent while townhouse sales decreased by four per cent.

There were 812 single-family homes for sale in February compared to 749 in January and 947 one year ago. The supply of apartments and townhouses also rose slightly from 2017, up three per cent and five per cent, respectively. These modest inventory increases are welcome, but since new listings are snapped up so quickly, this additional supply will not move the VIREB market out of sellers’ territory.

The British Columbia Real Estate Association (BCREA) notes that the housing market in B.C. is still thriving due to the province’s strong economy. However, BCREA forecasts some economic headwinds for 2018. It appears that Guideline B-20 – also known as the mortgage stress test – lay behind December’s uptick in sales as buyers scrambled to purchase before its January 1 implementation. Other risk factors include rising interest rates and new taxes introduced by the provincial government in the latest B.C. budget.

Broadening the scope of the Foreign Buyer Tax to include the Regional District of Nanaimo (RDN) will not have a significant impact on the VIREB housing market. Only 4.4 per cent of RDN residential real estate transactions in 2017 involved foreign buyers. More troubling is the new speculation tax, which targets homeowners who do not pay income tax in B.C., including those who leave their homes empty but still contribute heftily to the economy.

Kaye Broens, VIREB President-Elect, believes the speculation tax is well-intended, but the government is focusing on the wrong side of the housing equation.

“Instead of increasing supply, the B.C. government is concentrating on dampening demand,” says Broens. “Vancouver Island is a popular destination for retirees, many of whom come from Alberta, and the speculation tax could discourage many of those buyers.”

A more effective solution for combatting rising house prices is to increase supply, which includes streamlining the approval process for developers, adds Broens.

On a local level, buyer demand and limited supply have created a buoyant sellers’ market in the VIREB area. Multiple offers are commonplace, especially for properties in the $400,000 to $500,000 range. She stresses that it is a great time to sell.

“My advice to prospective sellers is to contact a REALTOR® to list their home now and not wait until spring,” says Broens. “Prices are still rising, but that cannot continue indefinitely. At some point, buyers will begin bowing out of the market due to affordability issues.”

In February 2018, the benchmark price of a single-family home in the VIREB area reached $483,400, up 19 per cent from one year ago. (Benchmark pricing tracks the value of a typical home in the reported area.) The benchmark price of an apartment last month rose to $293,900, up 29 per cent board-wide from the previous year, while the benchmark price of a townhouse hit $376,900, a 22 per cent increase from February 2017.

Last month, the benchmark price of a single-family home in the Campbell River area hit $392,700, an increase of 23 per cent over February 2017. In the Comox Valley, the benchmark price was $476,700, up 18 per cent from last year. Duncan reported a benchmark price of $419,000, an increase of 15 per cent compared to February 2017. Nanaimo’s benchmark price rose 18 per cent to $524,400 while the Parksville-Qualicum area saw its benchmark price increase by 19 per cent to $540,400. The cost of a benchmark home in Port Alberni reached $270,500, up 25 per cent from one year ago.

VIREB www.vireb.com

Ron Mehan, RE/MAX First Realty, Parksville, B.C.

 

RE/MAX #1 6 Years Running

 

RE/MAX continues to shine in the annual Entrepreneur Franchise 500 ranking of top franchises.

In addition to being the No. 1 ranked real estate franchise for the 15th time, RE/MAX climbed into the survey’s Top 5 for the very first time. It joined McDonald’s, 7-11, Dunkin’ Donuts and The UPS store in the elite five of household brand names.

More than 115,000 agents enjoy the competitive advantages of being with the industry’s top franchise brand. And who benefits from the skills of those agents? Homebuyers and sellers in countries around the globe.

Nobody in the world sells more real estate than RE/MAX, as measured by residential transactions. There’s a reason for that. And it starts with productive, hustling, all-in agents who strive to be the best at what they do.