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Cowichan Valley Realtor

Market Information

December 1, 2017

Even with the arrival of all this rain, more winter-like temperatures, new federal qualification rules for conventional mortgages coming, and rising interest rates, the real estate market in the Cowichan Valley is still not showing any signs of cooling down. That’s different from Victoria, where sales volumes registered by the Victoria Real Estate Board have shown a substantial slowdown. 

In my opinion we will start to see sales volume and listing inventories returning to normal levels in the New Year. Cowichan Valley market activity has always lagged behind the statistics for Victoria and Vancouver, whether the market is going up or down.

There were still only 168 active single family home listings on the market at the end of November, compared to 161 on November 30th of 2016. This is the first month in a long time I have seen the active listings higher than the year before.

Actual sales of single family homes in the Valley were up slightly in November to 77, compared to 72 sales in October, and up substantially from the 47 that sold in the same month last year. In the past 12 months, we’ve had 950 sales in the Valley, compared to 1,033 in the year before that; that’s a decrease of about 8%.  But the real story is that the average sale price in the last year has risen dramatically; the increase has been about 16%, to just over $451,000.  

On a personal note, I’ve been back in real estate for 4 years now, and I pride myself on running a smaller, more efficient business model with high quality marketing and service levels that consistently exceed expectations.  One of the ways I’ve done this is to keep my inventory of listed single family homes at 10 or under at all times; in fact, this year the most homes listed I had at any one time was 4. With this client-focussed strategy, I will still manage to sell over 40 homes this year.  This has helped me focus a lot more time on my listings to get them sold, as well as giving me a well-balanced personal life.  Right now, I’m almost sold out again, so your referrals would be greatly appreciated in the New Year. 

In terms of sales numbers, the MLS system has had a record 12 months with the list-to-sell ratio at 79%. That means for every 100 homes listed in the past 12 months, 79 sold. It’s worth noting that in November of 2008, that number was 26%.  In my case, I am at a 95.2% ratio for the last 12 months; I would be 100% but I took a new listing this week.

If you are thinking of selling, I encourage you to list in the early part of the year. The perception is that spring is the best time to sell, but the reality is that the best time to list is when supply is low. And that’s before everyone puts their stuff on the market in the spring. 

From my family to yours we wish you all the best over the holidays. Words cannot say how grateful I am for all the support from my incredible clients, friends, and family. My health is great, my daughters are thriving, Michelle and Andy got engaged and Kari and I are looking forward to celebrating our 30th wedding anniversary in the New Year. 2017 was a great, well-balanced work and play year; I really couldn’t ask for anything more.  I’m so thankful. 

Kari and I wish you and your family all the best in 2018.


Provincial update
  
BC Home Sales Rise Despite Low Level of Supply
Vancouver, BC – November 14, 2017. The British Columbia Real Estate Association (BCREA) reports that a total of 8,677 residential unit sales were recorded by the Multiple Listing Service® (MLS®) in October, an increase of 19.3 per cent from the same period last year. Total sales dollar volume was $6.25 billion, up 41.6 per cent from October 2016. 
The average MLS® residential price in the province was $720,129, up 18.7 per cent from October 2016.
“BC home sales trended higher in October, up 23 per cent from January on a seasonally adjusted basis," said Cameron Muir, BCREA Chief Economist."A lack of supply in the resale market continues to put upward pressure on home prices in most BC regions."
Total active listings were down 5.1 per cent to 27,987 units in October compared to the same month last year, and have declined 49 per cent over the last five years. The ratio of home sales to active listings was up from 24.7 per cent in October 2016 to 31 per cent last month. The BC housing market is considered to be in relative balance when the ratio of home sales to active listings is between 12 and 20 per cent.
Year to date, BC residential sales dollar volume was down 9.4 per cent to $63.8 billion, when compared with the same period in 2016. Residential unit sales declined 10.7 per cent to 90,290 units, while the average MLS® residential price increased 1.4 per cent to $706,881.
Housing Market Facing Headwinds Despite Strong Economy  
BCREA 2017 Fourth Quarter Housing Forecast
Vancouver, BC – November 28, 2017. The British Columbia Real Estate Association (BCREA) released its 2017 Fourth Quarter Housing Forecast today.
Multiple Listing Service® (MLS®) residential sales in the province are forecast to decline 10.4 per cent to 91,700 units in 2018, after an expected 8.8 per cent decrease this year. A record 112,209 unit sales were recorded in 2016. The ten-year average for MLS® residential sales in BC is 84,700 units. Strong economic and demographic fundamentals are supporting elevated housing demand. However, a number of factors are expected to temper home sales in the province next year.
“Housing demand across the province will face increasing headwinds in 2018," said Cameron Muir, BCREA Chief Economist."A rising interest rate environment combined with more stringent mortgage stress tests will reduce household purchasing power and erode housing affordability." The 5-year qualifying rate is forecast to rise 20 basis points to 5.15 per cent by Q4 2018, and the new qualification rules for conventional mortgages will erode purchasing power by up to 20 per cent. "Given the rapid rise in home prices over the past few years, the effect of these factors will likely be magnified."
The supply of homes for sale is now trending at or near decade lows in most BC regions. The imbalance between supply and demand has been largely responsible for rapidly rising home prices. The combination of weakening consumer demand and a surge in new home completions next year is expected to induce more balanced market conditions, producing less upward pressure on home prices. The average MLS® residential price in the province is forecast to increase 3.1 per cent to $712,300 this year, and a further 4.6 per cent to $745,300 in 2018.

Here is a link to this month’s Graph Stats for the Cowichan Valley, courtesy of the Vancouver Island Real Estate Board: Cowichan Valley Graph Stats

I hope you find this current market information informative. If you have any questions about the market please feel free to contact me anytime.

Thinking of selling? Please feel free to contact me for advice on preparing your home for the market. What money should you spend if any? When is the best time to list? I am happy to consult with you anytime even if you are not planning on selling for some time.

I would love to hear from you. Email me at ken@kenneal.com or Like me on Facebook at http://www.facebook.com/kennealduncan.