Finally, some real summer weather.
The weather isn’t the only thing that’s been “hot”; the Cowichan Valley Real Estate market can also be described that way. There were 102 single family homes sold in the Valley for the month of July, up just slightly from the 99 sold during the same period last year.
The annual rolling sales numbers are also still historically very strong. The 918 sales in our Valley in the past 12 months represented a 7% decrease from the 982 home sold in the 12 months ending on July 31st of last year. But it was only down due to the low supply of homes on the market. At the end of last July, there were 263 homes for sale in the Valley. Yesterday, that number was 203, which represents less than 2 months’ worth of supply in our marketplace. (It’s worth keeping in mind that a “balanced market” has about a 5 to 6 month supply.)
With that kind of tight supply in the market, the percentage of homes that are actually selling is up dramatically. In July of 2008, the “list-to-sell” ratio was just 39%. That means that out of 100 single family listings on the MLS system, 39 would sell. Last month, that number was 74%, and for the calendar year that ended yesterday, it was at 81%. It's also worth noting that I have personally continued the trend; so far this year, I've had a 100% list-to-sell ratio once the subjects come off my current deals.
As to prices, the average sale price for single family homes in the Valley over the last 12 months was $422,275, up 10% from the $385,015 at the end of July of 2016. I would say that realistically, overall prices have increased by 12-18% over the last year depending on the product and location.
So where is the market going? That's the million dollar question I get asked every day. It is really going to come down to government policies. Interest rates are on the move, and we have a new provincial government. If we look at history, the last time we had this combination in BC, things slowed down considerably. But this time, there are additional factors at play: record low inventory, almost zero vacancy rates, very slow new development activity due to so many layers of government red tape, affordability, immigration, and good paying jobs to name just a few.
I don't have a crystal ball, but I am still firmly convinced that in the big picture, the Cowichan Valley remains an undiscovered real estate gem. And when it does get “discovered”, look out! It's simply not going to be the same. At this point - until the inventory of homes increases - there will still be tremendous upward pressure on prices. The next number of months should be very interesting.
I hope you have a great safe hot long weekend, and that you take every opportunity to truly enjoy the rest of the fabulous summer weather that has now arrived.