Victoria’s $1.41 million record average house price delivers pivotal market shift in January as condos outsell SFDs
MIKE KOZAKOWSKI, CITIFIED.CA
Published February 1, 2022
The start of 2022 has delivered new real-estate price records for Greater Victoria following a record-laden 2021 and even signs of an emerging new trend, according to data released by the Victoria Real-Estate Board (VREB).
Surpassing December of last year’s then-all-time record high of $1.33 million for average single-family-dwelling prices, January kicked off 2022 with a $1.41 million average and an all-time high median of $1.252 million, which unseated the former record median price set in November of last year at $1.235 million.
The number of single-family-dwellings (SFD) sold from Sooke to Sidney totalled 179 (of 474 market-wide sales in January), matching 2019’s sales volume for the month but falling short of last January’s 297-unit total.
On the condominium front, new average and median price records were also set, landing at $683,759 and $603,420, respectively. The former record for average condo prices was from one month prior at $663,079 while the former median record was set in November at $585,000.
And for the first-time ever, more condominiums sold through the MLS (Multiple Listings Service) than did single-family-homes with 188 transactions (nine more than the total for SFDs). This toppling of the market's titan, that being the free-standing house, may even signal a sign of things to come.
“Escalating prices for single-family-homes have fostered tremendous demand for lower priced options, namely condominiums, which in turn saw their prices jump to new records but more importantly they outsold houses, and it looks like we could be in the early stages of condominiums becoming the sales leader in Greater Victoria,” said Victoria real-estate agent Marko Juras.
Despite overwhelming demand, only 62 townhomes sold via MLS in January as average prices leapt to $872,661 to unseat October’s record of $855,894. The median followed suit, finding a new perch at $861,250. Although more townhome supply is coming, the ‘missing middle’ component of the new-build industry has traditionally seen the lowest volume of new units in light of most developers pursuing approvals for higher densities in the form of condominium buildings.
“Ultimately what we have in this rather crazy market is persistent demand grinding up alongside ultra-low inventory and that’s leading to price appreciation,” Juras says.
“And while we are unlikely to see that demand versus supply equation change barring major economic jolts, the market activity we’re seeing guarantees added layers of provincial involvement in the real-estate industry, and we will get a sense of the first phase of new changes enacted this spring through a cooling off period for buyers with accepted offers.”
The pending cooling off legislation is expected to mirror the pre-sale sector’s one-week recision period that allows buyers with accepted offers to walk from their deal within seven days. How similar regulations transition into the re-sale market where properties are ‘one-offs’ as opposed to a grouping of similar pre-sales remains to be seen.
Active re-sale listings, according to VREB data, are at their lowest levels since record-keeping began in the Capital in January of 1996. 26-years-ago when Victoria’s population was in the range of 300,000 people and fewer domiciles were in the region, active inventory available for purchase was just below 3,800-units across the entire market spectrum (including commercial real-estate assets). Today, inventory for all sectors sits at fewer than 800-units for a population of around 400,000 people and thousands of housing units bigger.
“It is abundantly clear that what is driving prices is the lack of housing on the market for purchase and in the market, period. To make matters worse, the supply of new housing remains suppressed through onerous municipal limitations, a lack of developable land, and prevailing anti-development attitudes in most jurisdictions on the south Island,” Juras said.
Moving towards the spring buying market, traditionally the busiest time of year for Victoria real-estate, all eyes are on the provincial government and what it will unveil as measures politicians claims will lessen the impacts of fiercely competitive bidding scenarios. Whether those measures are effective, or if they get lost in translation through other market forces like rising interest rates, remains to be seen.
For now, Juras says data from the last month shows three quarters of all single-family-homes sold at or above their asking price, and two-thirds of condominium deals did, too. More of the same is expected in February. C
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