A lack of housing inventory, which has been a problem for Greater Victoria for years, will continue to shape the real estate market through 2021 according to the departing president of the Victoria Real Estate Board.
In delivering her year-end summary of 2020 on Monday, Sandi-Jo Ayers noted the lack of available homes could continue to drive prices up as the region’s economy starts to recover from the economic disaster dished out by the COVID-19 pandemic.
“Inventory continues to be the story. We just don’t have enough,” said Ayers, noting the board recorded 1,279 homes available on its listing service at the end of December, the smallest year-end number in 25 years.
That lack of supply coupled with low interest rates and sustained, strong demand in the region led to brisk sales in 2020 and some home prices soaring.
The region saw 8,497 properties change hands in 2020, eclipsing the 7,255 that sold in 2019 and the 10-year average of 7,329 annual property sales.
There were 631 sales recorded in December alone, up from 402 at the same time in 2019.
Ayers said other than a slowdown in March and April, the real estate market was strong through the entire year.
“Typically, we would see a slowdown around Dec. 15 or so and see it start to pick up again in the first week or so of January, but that just didn’t happen,” she said.
“The onset of the COVID-19 pandemic in March and April quickly swept away any illusions that our normal seasonal market patterns would persist. Equally surprising was the resurgence of our market in early summer when restrictions lightened and pent-up demand began pushing sales beyond expectations,” said Ayers. “The combination of the ongoing pandemic, historically low interest rates and a shift in consumer priorities towards properties that cater to a more home-based work/life/retirement balance resulted in record setting sales for the last several months of 2020.”
Pricing reflected the resilience. The benchmark value for a single-family home in the Victoria core (Victoria, Saanich, Oak Bay, Esquimalt, View Royal) was $915,100 in December, a significant jump from $857,200 in December 2019. The benchmark sale price of a condominium in the core on the other hand dropped slightly to $515,600 last month from $520,100 in December 2019.
Ayers noted even in areas that have traditionally offered more affordable housing like the West Shore there has been sustained price pressure.
The benchmark price of a single-family West Shore home last month was $728,900, up from $643,700 at the same time in 2019.
Ayers said the board has pushed municipalities to reduce red tape and streamline the development process to encourage more building to deal with demand, but she concedes it will take years before the industry catches up.
“The pandemic did not help inventory levels,” she said, noting many people may have been unwilling to put their homes on the market realizing they may not be guaranteed a place to move to. “We’re hopeful vaccines will make a difference there and that some new projects will be coming online soon.”
Canadian Real Estate Agent Rankings: RE/MAX Captures 33 of Top 100 – RE/MAX News
In a recent ranking of Canadian real estate agents by Rate-My-Agent.com Inc, 33 RE/MAX agents were named in the Top 100 list for 2020, claiming the most of any other brokerage. The review site compiled its list of top-rated Canadian real estate agents based on ratings and reviews received during 2020.
Congratulations to the RE/MAX agents from coast to coast made the list!
#4 – Jennifer Queen – RE/MAX Professionals (Winnipeg, MB)
#6 – Jamie Swaile – RE/MAX Performance Realty (Winnipeg, MB)
#8 – Ben Sweet & Meredith Miller – RE/MAX iRealty Innovations (Calgary, AB)
#11 – Patrick Fields – RE/MAX Select (Edmonton, AB)
#14 – Erin Hayes – RE/MAX Edge Realty Inc. (Burlington, ON)
#15 – Amber Van Den Broek – RE/MAX Executives Realty (Winnipeg, MB)
#17 – Evelyn Lacerda – RE/MAX Realty Specialists Inc. (Mississauga, ON)
#19 – Andy Kloppenborg – RE/MAX Performance Realty (Winnipeg, MB)
#20 – Seth Allred – RE/MAX House of Real Estate (Calgary, AB)
#21 – Anurag Sharma – RE/MAX Twin City Sharma Realty (Kitchener, ON)
#23 – Mira Marion – RE/MAX Performance Realty (Winnipeg, MB)
#26 – Marcel Gladu – RE/MAX Crown Realty (1989) Inc. (Sudbury, ON)
#32 – Meagan McKillop – RE/MAX Professionals (Winnipeg, MB)
#35 – Shawn Hinchey – RE/MAX Jazz Inc. (Oshawa, ON)
#36 – Marc Parenteau – RE/MAX Affiliates Realty LTD. (Ottawa, ON)
#37 – Pierre & Cynthia Charron – RE/MAX Professionals Saint John INC. (Saint John, NB)
#40 – Rie Takahashi Zhou – RE/MAX Real Estate (Kamloops, BC)
#42 – Mary Ann Schiralli – RE/MAX Aboutowne Realty Corp. (Oakville, ON)
#43 – Laura Schewchenko – RE/MAX Real Estate (Central) (Calgary, AB)
#45 – Michael Pavone – RE/MAX Elite (North) (Edmonton, AB)
#49 – Lorin McLachlan – RE/MAX Executives Realty (Winnipeg, MB)
#54 – Brent Miller – RE/MAX Real Estate (Kamloops, BC)
#62 – Marcus Power – RE/MAX Professionals Saint John INC. (Saint John, NB)
#63 – Colton Davidson – RE/MAX Real Estate Centre INC. (Kitchener, ON)
#65 – Bill Papaioannou – RE/MAX Escarpment Realty INC. (Hamilton, ON)
#69 – Scott Glover – RE/MAX Treeland Realty (Langley, BC)
#73 – Reisha Dass – RE/MAX Real Estate Centre INC. (Burlington, ON)
#77 – Connor Honey – RE/MAX Excellence (Edmonton, AB)
#81 – Ed Dale Jr. – RE/MAX Professionals (Winnipeg, MB)
#90 – Darren Yee – RE/MAX iRealty Innovations (Calgary, AB)
#91 – Larry Paletta – RE/MAX Escarpment Realty INC. (Stoney Creek, ON)
#98 – Carol Cohen – RE/MAX Elk Valley Realty (Fernie, BC)
Benefits of Working With a Professional Real Estate Agent:
Selling your home can be an emotional experience. In fact, RE/MAX research reveals that a real estate transaction is one of life’s top stressors, second only to divorce (ouch!). Under some circumstances, sellers may wish to handle the sale of their home on their own. As a consumer, you have the option to handle the transaction on your own, or work with a Realtor. While an FSBO may have some pros, it also has its cons. Click here to check out eight very valid reasons to have a real estate agent on speed dial.
Canadian Real Estate is Competitive. How do you Choose the Right Agent?
According to research by the National Association of Realtors, there are huge benefits to working with a real estate agent, including higher sale prices. However, every homebuyer and seller would be wise to do some “home work” to find a real estate agent who knows his or her market and who has a proven track record. Treat your vetting process like you would a job interview: ask lots of questions, and don’t settle until you’re satisfied with the answers. Click here for seven starter questions that should be on your list.
Canada’s Real Estate Market Is The Fastest Growing In The G7, And The Most Inflated – Better Dwelling
Canadian real estate prices aren’t just fast growing by local standards. They’re growing fast by any standard. US Federal Reserve data shows real home prices advanced in most of the G7 in Q3 2020. Canada topped the list of advanced countries for annual price gains. This isn’t a new trend though. Canadian real estate prices have become such a focus of speculation, they’ve grown almost 3x faster than the second fastest growing G7 country.
Canadian Prices Are The Fastest Growing In The G7
Canadian real estate prices are still growing at a breakneck speed. Real prices increased 2.93% in Q3 2020, bringing them 8.27% higher than the same quarter a year before. The annual growth is now the biggest of the G7 countries. Since the beginning of the Great Recession, Canadian real estate prices have outperformed every G7 market… by a wide margin.
G7 Real Estate Prices Change
The inflation adjusted change in G7 real estate prices in Q3 2020, compared to a year before. Source: US Federal Reserve, Better Dwelling.
Canadian Prices Grew 45% Faster Than Germany, The Second Best Performing Country
Germany’s real estate prices are the best performing in the past quarter, and just behind Canada annually. Germany’s real home prices increased 3.09% in Q3 2020, bringing real prices 6.99% higher than a year before. Despite being the second best performing country in the group, prices are only 38.5% higher than they were in 2005. That means Canadian prices grew 45.2% faster over that period – leading to a massive gap.
G7 Real Estate Price Index
An inflation adjusted index of G7 real estate prices. Source: US Federal Reserve, Better Dwelling.
Japanese Real Estate Is The Only Market To Fall
Japan, the negative rate marvel most countries are using as a successful model, is the only country that’s negative. Real home prices in the country were down a fairly flat 0.01% in Q3, bringing prices 1.15% lower than a year before. Real home prices in the country are 11.4% lower than they were in 2005, meaning home prices failed to even keep inline with inflation.
Italy Was The Only Other Market To Have A Slow Q3
Italy made the biggest quarterly drop in the most recent numbers, but still managed to squeeze out a gain. Real prices fell 2.14% in Q3 2020, bringing them 2.17% higher than last year. Since 2005, real home prices are up 30.1% – which is huge, it just doesn’t seem big against Canada’s movement.
Cheap money is a global trend, inflating almost every real estate market. Canada’s economy is unusually dependent on real estate though. The country’s residential investment is nearly double that of the US currently. It’s also almost 50% higher than the US was during their housing bubble. Somehow, the country’s central bank thinks growing at 25x the rate of US real estate is normal.
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Barrie is the New Investment Hotspot in Ontario Real Estate – RE/MAX News
For years, the Ontario real estate market had been dominated by a few key regions: Toronto, Ottawa and Hamilton. The rest of the province has generally garnered less attention compared to these booming housing markets. Yet, the coronavirus public health crisis changed everything, and now it is the suburbs and rural communities that are experiencing exponential growth and attracting people from these major urban centres.
Barrie has turned into one of the most sought-after real estate markets in the province, appealing to families who want to plant new roots, and real estate investors who want to profit on the investment buzz emanating from Central Ontario. Many industry observers had foreshadowed for years that Barrie was going to experience skyrocketing activity. Still, it was not until the COVID-19 pandemic and a change in real estate consumer behaviours that led to the city’s incredible success this year.
What was once a buyer’s market has quickly transitioned into a seller’s market, thanks to “strong growth” in sales activity and home valuations. But what does the latest data show? The growing real estate market in Barrie is not slowing down.
Barrie is the New Investment Hotspot in Ontario Real Estate
According to the Barrie & District Association of REALTORS® Inc. (BDAR), residential retail sales advanced 51.5 per cent in December from the same time a year ago, totalling 344 units in just one month. On an annual basis, home sales totalled 5,718 units in 2020, rising 23.6 per cent year-over-year.
According to BDAR, composite benchmark price rose 23.3 per cent to $613,200 in December 2020 compared to December 2019. All types of properties witnessed incredible growth at an annualized rate:
- Single-family: $644,000 | +24 per cent
- Townhouse: $440,600 | +28.8 per cent
- Apartments: $372,800 | +11.3 per cent
Overall, the average price of homes that exchanged hands in December soared 34.7 per cent year-over-year, to $744,835.
And these figures are anticipated to grow due to a lack of new supply coming to market, says Robin Jones, President of the Barrie & District Association of REALTORS®.
“Even with the recent influx of new listings overall inventories continue dropping to new record lows. With demand far outpacing supply we’re likely to continue seeing double-digit price growth through early 2021.”
Indeed, BDAR figures show that there were only 276 new residential listings in December 2020, which is up 39.4 per cent from the same time a year ago. Meanwhile, active residential listings plummeted 65.6 per cent from December 2019 to December 2020. Moreover, months of inventory fell to 0.6 at the end of December, down from 2.8 months at the same time last year. This is an important metric because it shows the number of months it would take to sell today’s stocks at the current rate of activity.
Real Estate Investors or Family Homebuyers?
The question that is now being entertained in the broader housing industry is whether Barrie is attracting real estate investors or family homebuyers.
While Barrie has become one of the go-to places for households looking to exit the big cities for quieter lifestyles in rural communities, Barrie also has various factors working in its favour to suggest this could be an investor’s dream. Here are some of the factors currently at play in the Barrie real estate market:
- Rental rates have been climbing due to a shortage of rental units. The city has attempted to rectify the situation by allowing homes to be converted into duplexes, raising the possibility of greater income generated from one house.
- Are bidding wars prevalent throughout Barrie? It is inevitable due to a short inventory list, and this is bullish for investors because it results in fast turnover.
- The Bank of Canada (BoC) has made borrowing cheaper and investing more rewarding. At the onset of the coronavirus pandemic, the central bank slashed interest rates. The result has been more borrowing and a transition away from safe-haven assets, such as guaranteed-investment certificates (GICs) and bonds. With rates expected to remain low (at least for now), it can be more affordable to borrow from mortgage lenders, giving you greater options in the housing market.
A Look at Barrie’s Real Estate Market in 2021
Can Barrie maintain this momentum heading into 2021? According to RE/MAX’s Housing Market Outlook (2021) report, Barrie real estate is expected to jump four per cent to an average price of $569,525 across all property types. Tightening housing inventories and strengthening demand are the city’s two primary factors driving its real estate boom in 2020, 2021 – and beyond.
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