Red hot real estate markets in Vancouver and Victoria are causing a temperature rise in the Cowichan Valley, too, says the Vancouver Island Real Estate Board (VIREB).
VIREB Past President Jason Finlayson said, “We’re definitely moving into a seller’s market here in the spring.”
A domino effect is taking place, with home buyers looking outside the hyper-expensive Vancouver market to Victoria, then – when they discover housing prices on the tip of the Island on the rise – farther north.
The benchmark price for a single family home in Duncan, at $303,800, compared very favorably to the same house in Victoria at $525,000 in January of this year.
With that kind of a differential “they’ll make the decision to drive over the Malahat,” Finlayson said. “They’ll see the price differential between Victoria and the Cowichan Valley and they will look here and buy.”
Adding to the upward pressure in Cowichan Valley, and elsewhere, is low inventory, and ‘pent up demand.’
Normally home buyers begin their searches in the spring. “That’s when you expect your activity to start happening,” Finlayson said. “This year the buyers came out of the gate right after January.”
Home sales doubled in Ladysmith this January compared to 2015, up from 6 to 13. “You’re probably getting more for you buck in Ladysmith,” he said.
Island-wide February saw a 44 per cent increase in single-family home sales, and VIREB says there are “no signs of the market slowing down.” This February 407 single family homes sold, compared to 258 last February.
Another factor in the brisk market is B.C.’s strong economy, compared to the rest of Canada, said the B.C. Real Estate Association’s chief economist Cameron Muir.
“Some of what we’re seeing is pent-up demand spilling over from 2015, which saw record sales,” says Muir. “We’re anticipating that 2016 will be another busy year, but do expect activity to taper off somewhat in the latter half.”
VIREB President Margo Hoffman said a new trend has been noted, with young buyers migrating to the Island.
“We’re beginning to see some migration from Vancouver that isn’t retirement-focused,” she said. “An interesting development we’re watching is younger professionals who are trading in their homes for a significantly nicer property on Vancouver Island and then commuting to their jobs on the Lower Mainland.”
Hoffman said that the VIREB market is firmly in seller’s territory, with limited inventory continuing to be a challenge. She said savvy sellers may want to take advantage of market conditions.
“We’re seeing multiple offers in many transactions throughout the board area because there are more buyers than sellers,” said Hoffman. “If you’ve been thinking about selling, it’s a perfect time to do so because there are lots of people who will want your home.”
Finlayson concurred, adding that he has experienced multiple sales offers.