Not enough growth in inventory means spring market sales slow
 
A total of 637 properties sold in the Victoria Real Estate Board region this April, 22.7 per cent fewer than the 824 properties sold in April 2022 but an 8 per cent increase from March 2023. Sales of condominiums were down 21.8 per cent from April 2022 with 205 units sold. Sales of single family homes decreased 19.4 per cent from April 2022 with 325 sold.

“Sales numbers for this April are more moderate than the higher levels we’ve seen in recent years,” said Victoria Real Estate Board Chair Graden Sol. “We are in a familiar market pattern, where the majority of sales for the year occur in the spring.

While we’ve seen an increase in sales over the previous month, we’re not expecting a return to record setting activity. Our inventory levels continue to be very low and new properties are slow to come onto market. More inventory is needed to balance the supply against spring demand. The good news is that prices have stabilized for now. If listings do not pick up over this season, there is a risk that the price stabilization could turn and we could see prices increase.”

Economic Insights from Dr. Sherry Cooper

It has been just over a year since the Bank of Canada started hiking interest rates. While the economy has remained surprisingly resilient, the housing market has weakened sharply.

The Bank has remained on the sidelines for the past two Governing Council announcement dates, and home sales have edged upward in very tight markets.

There is a rapidly growing housing shortage. As population growth remains strong and immigration targets rise, new home construction cannot keep up with demand. Demand for rental properties is surging, and rents have risen sharply for new tenants.

Another factor that could slow the economy this year is the rise in monthly housing payments. For those with adjustable-rate mortgages, monthly payments have already risen sharply. Most of those with variable-rate loans with a fixed monthly cost has hit their trigger point, and the amount no longer covers any of the principle. Most banks have allowed negative amortization but will require borrowers to return to original 20-year amortizations upon renewal. This could be quite a shock to consumers over the next few years.

The Office for the Superintendent of Financial Institutions is very concerned about the risk associated with these loans. We will be hearing soon from OSFI regarding more restrictions on mortgage lending.

The great news is that inflation is falling quickly, down to only 4.3% in March. The central bank expects inflation to fall to about 3% by the end of this year. So, barring unforeseen inflation pressures, the Bank could pause for the rest of this year. Rate cuts, however, are unlikely until 2024.

The Canadian economy will likely slow as the year progresses. The most likely scenario is a mild recession later this year. As we move into 2024, interest rates will slowly decrease to about 2.5% for the overnight policy rate. The economy will rebound, and the Bank of Canada expects to hit its 2% target on inflation. That might be hard to achieve, given rapidly rising wages and continued inflation expectations.

 

Creating the “Wow” Effect in Buyers

It’s incredible how quickly people form first impressions. According to some studies, people can develop lasting opinions within seconds of seeing someone, something, or someplace new.

That’s why, when preparing your property for sale, it’s important to do everything you can to make sure it looks attractive to buyers.

Nowhere does this first impression phenomenon play out more than when a buyer first enters your home. The moment they walk through your front door, they’ll look around, take in the scene and form an impression.

Ideally, you want that crucial first impression to be, “Wow. This place looks great! I can hardly wait to check out the rest of this home.”

So how do you ensure that happens?

One way is to play the role of a buyer yourself. Walk through your front door as if you’ve never been inside your home before. Pretend you’re a buyer and look around. What do you see? What impresses you most from that perspective? What do you notice that concerns you?

Pay attention to anything distracting: walls in need of painting, cluttered furniture arrangements, too much or too little lighting. This exercise will give you immediate ideas for improving — or Home Staging, as it’s called in real estate — the view from the front door foyer. For example, you might discover that a weekend painting project along with some decluttering, would make a big difference in how your home looks from this vantage point.

Typically, it doesn’t take much work to make these types of changes and improvements. But, when you do, your home is likely to look more impressive to buyers as they walk through your front door. That’s an impression that’s likely to linger as they view the rest of your property.

 

CBC B.C. - Residents of stratas with 55-plus age limits can now have younger family members live with them. British Columbians residing in stratas with 55-plus age restrictions will now be able to have family members under that age live with them, the province announced Monday.

Victoria Times Colonist – Sales pace, prices down for Greater Victoria homes

CBC B.C. – New Victoria affordable housing development touted as potential model for future housing in B.C.

Vancouver Sun – CONDO SMARTS: Proposed legislation a road map for strata considering EV upgrades

Vancouver Island ranked as best place to buy in B.C. (Business in Vancouver) 

Vancouver housing report shows new construction stuck because of skyrocketing costs (Globe and Mail) 

Victoria Times Colonist – Local governments seek provincial help regulating tiny homes

Victoria Times Colonist – Buildings near Langford apartment tower evacuated, new offers of help unveiled

Victoria Times Colonist – CONDO SMARTS: Developer is not strata's warranty provider

CBC B.C. – Could this condo be more awesome? Friends-themed apartment in Victoria for sale

Victoria Times Colonist – Saanich aims to buy land from Shelbourne property owners to widen roadway

Business in Vancouver – International visitors flocking back to B.C.

Financial Post – Vancouver home prices rise 5% so far this year with listings stuck near record-lows

Storeys – Homebuyer confidence returning in Greater Vancouver: REBGV

Vancouver Sun – It's a slow spring for B.C.'s housing market, but prices have begun inching up

Vancouver Sun – Five great (and affordable) places to retire in B.C.

Victoria Times Colonist – Langford council approves financial plan with record-high tax increases

Victoria Times Colonist – New Saanich policy to require developers to help displaced tenants

‘Very scary time’: Poll finds 76% of B.C. mortgage holders worried about next renewal (Global News) 

Financial Post - Canada's home prices haven't hit bottom yet, says CMHC - Canadian home prices will continue to decline until the middle of 2023 before they bottom out and start rising again through 2025, according to the Canada Mortgage and Housing Corporation’s latest housing market outlook.

Globe and Mail – CMHC forecasts 32 per cent drop in new home construction due to inflation, labour shortages

Toronto Star – Canadian home prices stabilizing, but market faces ‘alarming’ lack of housing starts

Toronto Star – Average home price will not revert to pre-pandemic levels this year: CMHC

Canadian Mortgage Professional – National home prices to stabilize in mid-2023 – CMHC

Canadian Mortgage Professional – Which demographic is the main buyer of recreational property in Canada?

Bank of Canada concerned inflation could remain “stuck” above 2% (Canadian Mortgage Trends) 

The mortgage stress test has helped protect Canada’s housing market in this downturn: OSFI (Canadian Mortgage Trends) 

Interest rates expected to fall to 3.00% by end of 2024 (Canadian Mortgage Trends) 

CMHC Sees No Return to Pre-Pandemic Price Levels in Annual Housing Forecast (Storeys) 

Lifetime mortgages becoming the new normal (Toronto Sun) 

Canadian Mortgage Professional – With home prices set to climb again, what's the outlook for first-time buyers?

Wall Street Journal – Finding the right house can take a while. For one buyer, the process spanned ’91 homes in total’

Business Insider – Move aside, tiny homes: The barndominium is the hottest thing in alternative housing, and it shows just how much the pandemic has changed what people look for in a home

Globe and Mail – Biddings wars and high prices lure home sellers out

Canadian Mortgage Professional – Multigenerational home construction could surge in Canada, says executive

Storeys – The most affordable Canadian markets for single-income apartment buyers

Construction Data & Analytics:
https://www.yellowsheet.ca/customer_main.php


Notable, Quotable, Quotes!

 

“Whatever fear I have inside of me, my desire to win is always stronger.”

Serena Williams

Did you know that major customer review sites get hundreds of millions of views each month?

It’s hardly surprising when you think about it.

After all, when most people are looking to buy something, or hire someone, they tend to trust a recommendation more than an advertisement. That’s true whether you’re shopping for a car, restaurant, dentist, or… real estate agent.

In fact, referrals from valued clients are one of the main ways I build my business.

They are something I take very seriously. I work hard to be “referral worthy” by providing excellent service and continuing support — not just during a client’s move, but in the years afterward. This e-newsletter is just one of the many ways I do that.

So, the next time you come across a neighbour or friend looking for a good real estate agent, I hope you’ll feel comfortable giving them my name.

I’d really appreciate it!

And, please allow me to return the favour. The next time you’re looking for a real estate-related professional — such as a contractor or electrician — reach out to me for a referral from my network. I’m happy to help.

On Your Team!

Diana Winger Personal Real Estate Corporation 

 CNE, SRS, SRES, ABR | eXp Realty

Housesforsale369.com | HomeVictoria.com | 250-588-8839

Mortgage Agent Level 1 Valko Financial LTD #13047

Dominion Lending Centres

 

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