South Island homebuyers hoping for a larger price respite may have to make tough decisions over the near-term, or hold out for the prospect of higher mortgage rate increases in 2023.

 

For the time being, at least, Victoria’s real-estate market is just ended a relatively strong month that delivered higher sales across the entire housing spectrum compared to September, and steeper price points for houses and townhomes.

 

October’s average cost of a house in Greater Victoria, according to data released by the Victoria Real-Estate Board (VREB), was $1,226,455 across 230 sales via the Multiple Listings Service (MLS). The median landed at $1,052,000. September saw 221 sales at a $1,213,743 average and $1,062,000 for the median.

 

Last month, Citified’s conversation with Victoria realtor Marko Juras described market conditions that appeared to suggest real-estate valuations were levelling out, and by most measures from October, that theory has been further bolstered.

 

“The differences between the medians keeps getting smaller and smaller month-over-month, to only $10,000 between September and October, compared to $91,000 between June and July,” Juras says. “When overall sales volumes dip, the median is going to be the key number to pay attention to, and what’s been happening to the median price since July suggests we are approaching a new plateau.”

 

The median, or exact mid-point value of a property within its respective category, is different from the average, which can more easily fluctuate due to high-valued sales, or a lack thereof.

 

152 condominiums sold via the MLS, the VREB says, averaging $614,769 at a median of $539,500. September had 126 transactions at a slightly higher $628,356 average and a $545,000 median. The median in this segment is settling, too, with a split of only $5,500 between September and October compared to a $33,000 difference between May and June.

 

Townhome sales pushed above September’s 40 units to reach 59 via MLS, and averaged well above September’s $786,835, at $823,515. The median rose to $755,000 from the previous month’s $737,500.

 

Total MLS transactions, including manufactured homes and commercial properties, reached 480, placing October of this year in 10th place for the month between 2013 and 2022, but well above 2012’s 373 and a touch higher than 2010’s 467. A 1990-2022 low of 316 was recorded in 2008. September had 410 sales.

 

Active listings fell to 2,192-units from 2,300 a month prior. New listings for the month reached 998-units compared to 1,155 new units in September, a marked drop from a near-term monthly peak of 1,531-units in May.

 

Looking forward, Juras suggests that even for a roller coaster year in the Capital, 2022 will still land as the second highest grossing year, ever, with an expected total transactional tally of $6.6 to $6.7 billion through the end of December. Only 2021 will be higher, at $8.98 billion. 2020 saw $6.53 billion, and 2016 totalled $6.13 billion. Through the end of October, the cumulative investment in Victoria's real-estate is already $6.16 billion. Juras also expands on where here believes the market is headed, given the variables in play.

 

“To look ahead, let’s start with where the market is currently at. You have falling inventory levels once again, you have a stable economy on the south Island with what could be the largest unionized employment wage increase in quite some time on the horizon, and you have plenty of professionals earning sufficient incomes to afford Victoria’s real-estate prices, especially at today’s suppressed price points, and especially if these buyers have some equity to work with,” Juras said.

 

“And on the mortgage rate front, the Bank of Canada’s 0.50% increase to its overnight lending rate in October was lower than the expected 0.75%, suggesting the bank has greater confidence in the economy than economists thought, and if December sees a 0.25% or no increase, that will further drive buyer confidence,” Juras added. “I can see this playing quite favourably into the busy spring months, if buyers feel the largest rate increases are behind them.” C

 

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