The healthy summer housing market on Vancouver Island is expected to continue into the fall.
August housing sales saw an increase of 22 per cent over last year, with 439 single-family homes sold on the MLS® system compared to 361 in August 2014, according to the Vancouver Island Real Estate Board.
Although sales dipped approximately 15 per cent from July, the decrease reflects typically slower August sales volume rather than being an indicator of a weakening market. Inventory levels are still declining, with active listings down nearly 17 per cent from one year ago.
VIREB President Jason Finlayson confirms that realtors were busier than usual in June, July, and August, but the local market remains balanced overall.
“We’ve had a stronger summer compared to other years, but our market didn’t see the feverish activity experienced on the Lower Mainland,” says Finlayson. “And, despite steadily declining inventory throughout the board area, our benchmark price increased by only six per cent over August 2014. Sellers still need to price their home correctly for buyers to bite.”
In August 2015, the benchmark price for a single-family home in the VIREB coverage area was $338,700, the same as July and up approximately six per cent from 2014. Benchmark pricing tracks the value of a typical home in the reported area. The average price of a single-family home was $359,497 compared to $339,547 in August 2014, an increase of six per cent.
The benchmark price for homes rose in most communities on Vancouver Island, except for Port Alberni.
The August 2015 benchmark price of a single-family home in the Campbell River area was $275,400, an increase of 3.21 per cent from last year. In the Comox Valley, the benchmark price was $339,200, up 4.22 per cent from 2014.
Duncan reported a benchmark price of $299,800, an increase of 8.32 per cent over the same month in 2014. Nanaimo’s benchmark price rose 7.77 per cent to $356,900 while the Parksville-Qualicum area saw its benchmark price rise by 4.87 per cent to $375,500, unchanged from last month. The price for a benchmark home in Port Alberni was $192,200, a decrease of 1.49 per cent since August 2014.
Consumer confidence is the primary driver behind B.C.’s robust housing market although low interest rates continue to be a contributing factor, states Chief Economist Cameron Muir of the British Columbia Real Estate Association, BCREA.
“We’ve had low interest rates for a long time now, so consumer confidence is what’s pushing average sales activity into the above-average range,” says Muir.
Despite fears of a “technical recession,” flat economic conditions are largely regional, with provinces affected by a weak oil patch taking the brunt.
“British Columbia, Ontario, and Quebec thus far haven’t been affected by problems in the oil patch,” says Muir. “In fact, our provincial economy is still the strongest in the country. We expect that trend to continue for the rest of the year and into 2016, and that growth will underpin the housing market.”