While many business sectors are slowing down or stopping amid the COVID-19 pandemic, the world of real estate in Victoria is continuing to soar.
In March, a total of 1,173 properties sold in Greater Victoria. That’s a 92.9 per cent increase over last year’s 608 sold properties, according to the Victoria Real Estate Board (VREB).
Sales of condominiums have more than doubled since last year, seeing an increase of 111.8 per cent with 377 units sold. Sales of single-family homes were up 88.2 per cent from March 2020 with 574 sold.
“Limited supply with overwhelming demand has been the story for the first quarter of 2021,” said VREB President David Langlois. “Numbers from last month are close to the market trends we saw in 2016, but with an even greater imbalance in inventory due to a surge in consumer demand for homes in the Victoria area.”
Langlois says comparing March 2021 to March 2020 isn’t really fair, as sales were down that month due to the beginning of the pandemic. Even so, he said, this year’s numbers are still staggering.
“This time last year was the beginning of the pandemic and most everything was shut down – so we cannot compare year over year numbers – but if we look at longer-term trends, the average number of sales from the month of March in the past ten years before 2020 was 715 properties,” said the VREB president.
He says the underlying issue is a deficit in supply. There simply aren’t enough properties to fill the demand in Greater Victoria.
Langlois says the solution is to push the government to increase supply and implement sensible policies in housing around land-use and development processes.
“These sorts of measures raise the overall cost of housing and add even more challenges for first-time buyers,” said Langlois.
The overall price of a single-family home has also increased since last year.
In March 2020, the Multiple Listing Service Home Price Index (MLS HPI) benchmark value for a single-family home in the Victoria Core was $879,600.
Now, the benchmark value for the same home in March 2021 has increased by 10.1 per cent to $968,700. This is also a 2.2 per cent increase from the previous month of February.
While the price of houses has jumped up, the cost of a condo has actually gone down in Victoria.
The MLS HPI benchmark value for a condominium in the Victoria Core in March 2020 was $531,800, while the benchmark value for the same condo in March 2021 remained close to last year’s value at $529,100 — a 0.5 per cent decrease.
The lack of an increase could have something to do with the skyrocketing insurance premiums last year that continued to climb until December 2020.
Right before the end of February 2020, insurance premiums for condos shot up — a cost that was passed on to the condo owners through increased strata fees. Experts projected a 20 per cent increase across the board but some condos faced a 300 per cent increase in premium.
In December, insurance companies in the province agreed to put a stop to the spiking insurance prices.