Real estate market makes gains in 2023, from slump to slow recovery

Real estate market makes gains in 2023, from slump to slow recovery

One year ago, with interest rates at rock bottom, the sky was the limit for the real estate market, but fast forward 12 months, with jacked-up interest rates, it’s a much different picture.

According to the Victoria Real Estate Board, February 2022 was a record with 718 home sales in Greater Victoria.

A year later, it’s a different picture with a 36 per cent drop – only 460 homes were sold in February 2023.

In spite of those grim numbers, there is optimism.

Brendon Ogmundson, chief economist with the BC Real Estate Association, said there are signs of a recovery.

“There is some encouraging signs that sales have bottomed out, and we could see a gradual recovery from here,” Ogmundson said.

Leo Spalteholz is an independent real estate analyst and maintains the HouseHuntVictoria blog, and he says prices have stabilized.

“It’s definitely picked up a bit from where it was in the fall. And we see that in market conditions. and we see that in prices. Last year when rates started going up, we saw prices fall quite rapidly. That’s no longer happening. Prices have stabilized for the last few months,” Spalteholz said.

As the third priciest city in Canada, Victoria’s housing prices are still close to their peak but they are lower.

From a high of more than $1.3 million on average last year, prices for single-family homes dropped 5.6 per cent in 2023.

And those looking to buy have fewer options.

“I think it’s a stalemate, between buyers that are fairly picky, and many are at the absolute limit of their affordability. That’s what is leaving many on the sidelines. And then sellers that are not wanting to take any kind of lower offer right now,” Spalteholz said.

The Canadian Real Estate Association says it expects more properties to be ready for the market in the spring.

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Mary GriffinMary Griffin

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