A shrinking number of properties for sale in Greater Victoria is translating into fewer sales, despite strong demand.
“The real estate story right now continues to be inventory,” David Langlois, president of the Victoria Real Estate Board, said Tuesday as July sales statistics were released.
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At the end of July, there were just 1,270 listings — down by 52.1 per cent from the 2,653 properties on the market at the same time a year ago.
Inventory dropped by 7.6 per cent, or 1,375 listings, last month from the previous month.
“The market is driven by inventory and fewer home listings lead to fewer home sales,” Langlois said. “In that context, these numbers do not reflect a downturn in our market but reveal sales falling due to this continued trend of low inventory.”
A total of 835 properties sold last month, down by 14.7 per cent from the 979 sales in July 2020, the board’s report said.
Elton Ash, regional executive vice-president for RE/MAX western Canada, said the real estate market is returning to normal patterns, as sale are typically lower in July and August after a stronger spring.
He predicts inventories will rise in the capital region because that’s what happening in major markets across the country. “We are seeing inventory levels starting to increase. I’m confident we will see it higher in Victoria as well.”
Prices in the capital region have remained strong so far this year.
The benchmark price for a single-family home in the core was $1.082 million in July, up by 1.7 per cent from June.
A year ago, that benchmark was at $909,900.
Benchmark refers to the value of a home in a particular area over time, a method the real estate industry says more accurately reflects the market than average prices.
In May, the benchmark price for a single-family house in the core topped $1 million for the first time, although the average price had surpassed $1 million previously. The core consists of Victoria, Esquimalt, Oak Bay, Saanich and View Royal.
For many people, a single-family house in the core area is financially out of reach, a factor driving condominium construction and sales. Condos are typically less costly than a single-family house.
The benchmark value for a condominium in the core in July was $535,100, an 8.1 per cent increase from $494,900 in July 2020, the board said.
Langlois said it’s important for the long-term health of the housing market that the region maintains a “strong focus” on developing new homes to meet growing demand.
For the Vancouver Island Real Estate Board, north of the Malahat, where inventory is also tight, 450 single-family homes were sold, down 15 per cent from 531 in June. In the condo apartment category, sales dropped by seven per cent from June. However, row/townhouse sales rose by 29 per cent from the previous month.
TORONTO – One expert predicts Ottawa‘s changes to mortgage rules will help spur demand among potential homebuyers but says policies aimed at driving new supply are needed to address the “core issues” facing the market.
The federal government’s changes, set to come into force mid-December, include a higher price cap for insured mortgages to allow more people to qualify for a mortgage with less than a 20 per cent down payment.
The government will also expand its 30-year mortgage amortization to include first-time homebuyers buying any type of home, as well as anybody buying a newly built home.
CIBC Capital Markets deputy chief economist Benjamin Tal calls it a “significant” move likely to accelerate the recovery of the housing market, a process already underway as interest rates have begun to fall.
However, he says in a note that policymakers should aim to “prevent that from becoming too much of a good thing” through policies geared toward the supply side.
Tal says the main issue is the lack of supply available to respond to Canada’s rapidly increasing population, particularly in major cities.
This report by The Canadian Press was first published Sept. 17,2024.
OTTAWA – The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely stuck in a holding pattern despite borrowing costs beginning to come down.
The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.
On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.
CREA senior economist Shaun Cathcart says that with forecasts of lower interest rates throughout the rest of this year and into 2025, “it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well behaved in most of the country.”
The national average sale price for August amounted to $649,100, a 0.1 per cent increase compared with a year earlier.
The number of newly listed properties was up 1.1 per cent month-over-month.
This report by The Canadian Press was first published Sept. 16, 2024.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
