According to new statistics from the Victoria Real Estate Board, supply is dropping while demand grows
Bidding wars, a construction boom, offers above asking price — they’re reminiscent of the real estate market prior to the 2008 housing market crash.
But realtors and industry experts say that we are once again moving toward a seller’s market, where supply is low but demand is on the rise.
The Victoria Real Estate Board has released its statistics for October where the number of active listings dropped 19% over October of last year.
But demand is up, with 734 properties sold in October 2015 compared to 602 the year before, an increase of nearly 22%.
The low supply and high demand is putting pressure on prices, driving the average single family home price to $608,200, up 9% from October 2014.
“That type of scenario leads to a lot of multiple offer situations and it’s really slanted in the seller’s favour or leaning that way now,” said realtor Jordy Harris with Newport Realty.
While the Victoria Real Estate Board doesn’t track the number of foreign buyers, realtors say, unlike Vancouver, they account for a very small percentage of sales here.
“You’ll always see pressure on our market from outside of Victoria, outside B.C., a lot of that is from across Canada. We do see some buyers coming in internationally, but I’m not sure if we see a lot more than ever,” said Guy Crozier, President of the Victoria Real Estate Board.
Construction is booming in several communities as developers try to meet the rising demand.
In areas like the West Shore and the Saanich Peninsula, that boom in construction has kept supply healthy, and prices down, but in other areas like Saanich, Victoria, and Oak Bay, Harris said bidding wars have already started.
“You have to go to the transaction, well prepared like never before.”
The market has been building steadily for more than two years, and experts believe this is only the beginning.
“You see those interest rates stay low, economic activity is really good, the forecast by all accounts is really good for Victoria,” said Crozier.
Industry experts say because its moderate price increases are being supported by population growth, the risk of a market correction in Greater Victoria is low.