November 1, 2018
I hope you enjoyed the incredible stretch of sun shine we’ve had to end the summer? Today’s normal seasonal change to cooler temperatures is also being reflected in the Cowichan Real Estate market.
Here’s the #1 Question I receive almost every day. “Is now, a good time to buy or sell?”
Let’s look at the Facts:
Single family home sales in the Cowichan Valley have slowed down slightly, following the provincial trend in October, with 63 units changing hands for the month, compared to 72 in October last year. The number of homes sold over the last 12 months dipped down 4% to 883 compared to 920 in the previous 12 months. In terms of actual units sold, the market has now had 7 consecutive months with the sales volume slower than the same month the year before.
But here’s one of the most important facts that will help you determine whether this is a good time for you to buy or sell:
Although we’ve had a decrease in sales volume from the same month last year, the average sale price has risen by about 13%, to just over $ 500,000.
Another more accurate tool:
The benchmark price from the Vancouver Island Real Estate Board’s Home Price Index, shows that from September 2017 to September 2018, home sale prices in the Cowichan Valley were up 11.3 % to $ 470,400.
The inventory of homes in the Cowichan Valley continues to buck the province wide trend and remains low with197 active single-family home listings on the market yesterday compared to 188 on the same day in 2017.
For context, there were 527 homes on the market in October of 2008. The current inventory represents a 3.13 month supply of homes on the market. Statistically, a 5-6-month supply is considered to be a fairly balanced market. There are substantial variations in the number of listings available for sale and selling by area, property type and price range. The lower end of the market, Condominiums and Town houses remain at very low inventory levels, while the upper price ranges are now offering more homes to choose from.
We have also started to see the time to sell properties increase. Last year for the month, the average was 30 days to sell and this year that number is up to 45. The percentage of list price sellers are achieving is also changing. Last year a seller in October averaged 98% of list price. This October, sellers achieved 95% of list price, that’s a fairly substantial change but it could have been affected by a few sales in a small market. I will be keeping a close eye on this over the coming months.
Your decision to buy or sell, should not be based on “averages.” What counts is the actual dollar value of the buy or sell transaction – and as you read earlier, actual closed transaction value is up 11-13% vs. a year ago.
Buyers are starting to receive more home value for “dollars invested” and sellers over the year benefited from the uptick in what their home actually sold for and cash received.
The timing of the “buy or sell” decision is one of the most important you’ll ever make and should be made on the “facts,” not on “averages.”
Need more “facts?” Then call Ken today and schedule a “conversation” to help you make the decision that’s best for you – there’s no cost, no obligation…just the Facts.
BC Home Sales Continue at Slower Pace in September
Vancouver, BC – October 11, 2018. The British Columbia Real Estate Association (BCREA) reports that a total of 5,573 residential unit sales were recorded by the Multiple Listing Service® (MLS®) across the province in September, a 33.2 per cent decrease from the same month last year. The average MLS® residential price in BC was $685,749, down 1.1 per cent from September 2017. Total sales dollar volume was $3.8 billion, a 34 per cent decline from September 2017.
“BC home sales continue at a slower pace compared to last year,” said Cameron Muir, BCREA Chief Economist. “The impact on affordability and purchasing power caused by the mortgage stress test and moderately higher interest rates are negating the effect of the extraordinarily strong performance of BC’s economy over the last five years.”
Year-to-date, BC residential sales dollar volume was down 21.3 per cent to $45 billion, compared with the same period in 2017. Residential unit sales decreased 22.5 per cent to 63,251 units, while the average MLS® residential price was up 1.5 per cent to $716,096
Bank of Canada Interest Rate Announcement - October 24, 2018
The Bank of Canada raised its target for the overnight rate by 25 basis points to 1.75 per cent this morning. In the statement accompanying the decision, the Bank noted that the Canadian economy is expected to average growth of 2 per cent over the second half of 2018 before slowing to 1.9 per cent next year. The renegotiation of NAFTA is expected to lower uncertainty and boost business investment and exports while households spending and the housing market are stabilizing after the implementation of the B20 mortgage stress test. Inflation is expected to remain close to 2 per cent over the Bank's two year projection horizon.
The resolution of NAFTA negotiations earlier in the fall paved the way for the Bank of Canada to resume its rate tightening this morning. While inflation data came in slightly soft in September, the Canadian economy is still operating above its long-run trend which should keep inflation near the Bank's 2 per cent target. The Bank will meet one final time in 2018 at its December meeting, at which we expect policymakers will maintain the target rate at is current level before raising the target rate to 2 per cent in January 2019. As the target rate continues on its path higher, Canadian mortgage rates will continue to rise, ultimately resulting in a 6 per cent qualifying rate by the end of 2019.
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 firstname.lastname@example.org or Like me on Facebook at http://www.facebook.com/kennealduncan.