Victoria Real Estate Market Report September 1, 2020
Continuing the trend started in June after the “Covid-hobbled” months of April and May, sales were once again brisk in August. Overall, sales of all properties in the Victoria Real Estate Board region were up 48.1% over August 2019. Sales of condominiums and single-family-homes were up 29.1% and 45%, respectively over August 2019.
Given that available inventory (active listings) is down 8.9% compared to August of last year, the pace of sales is not surprising.
Multiple offers are still occurring every day, particularly in single-family-homes under $1 million. However, the higher end of the market has also seen its share of activity. For instance, the sale of our waterfront listing in Oak Bay for $3.8 million received multiple offers and was the highest priced listing sold on Vancouver Island in August.
Prices remain strong for single-family-homes with a bit of a softening in the condo market. The benchmark price for single-family-homes in the Victoria Core was up 4.7% when you compare August 2019 to August 2020. And while there was a 2.3% decrease in the single-family-home benchmark price compared to last month, pricing shifts between July and August are not unusual. The benchmark price for condos was down 0.8% when you compare August 2019 to August 2020.
An August 17th report prepared by Robert Hogue of RBC Economics, confirmed that the extremely active market that we’ve been experiencing since June in Victoria has been echoed across most of Canada. Hogue noted that, “Buyers far exceeded sellers last month. The sales-to-new listings ratio jumped to 0.74 Canada-wide – the highest it’s been in 18 years. If sustained at this level, it would signal intense upward pressure on prices.”
As we noted in our earlier updates, Hogue pointed out that the pandemic has shifted the normal busy spring activity into the summer. He stated, “we expect further unwinding of pent-up demand to keep sales brisk in August and perhaps September before cooling later this year.” He was certainly right about activity in August.
On the subject of prices, Hogue stated “We see little that can stop the appreciation in property values near term. If anything, many markets are likely to experience further acceleration. That said, we continue to believe the eventual shift to a lower demand baseline later this year will have a cooling effect on prices – most likely by the early stages of 2021.” He did note that there could be downward pressure on prices if the pandemic worsens or the economic recovery runs into trouble.
With so many people working from home for the first time because of the pandemic, we’ll be watching to see what effect this will have on the real estate market, both residential and commercial. If companies and governments feel that a significant number of their employees can work efficiently from home, they may conclude that they don’t need as much expensive office space. And from the worker’s side, they may be looking to find homes that are larger or are better suited to doubling as a residence and full-time office.
You can find the full Victoria Real Estate Board report as well as recent reports from the BC Real Estate Association and the Canada Mortgage and Housing Corporation by clicking on the links to the right.
If you have any questions, we’re here to help.
Hal Decter, LLB & Audra Poole