Welcome! I hope everyone has had the chance to enjoy the hot sunny weather! We’ll talk a bit about Victoria BC real estate stats and some other topics.
Last time we discussed the topic of foreign and speculation taxes, and mortgage qualifications. This brings me to condos. Seems to be a hot topic these days! Seeing as most condos are more affordable than houses and town houses, they make a good point of entry into today’s real estate market. Considering the new mortgage qualifications that came into effect in the new year, this opens a lot of doors for first time home buyers, giving additional buying power in that sector. We’ve ushered in a large number of buyers while the housing market continues to cool down. In addition to first time home buyers, we’ve got a lot of activity from investors recently. Here are a few micro statistics on the current state of July’s market. I’ll also go over a couple of tips and suggestions for our readers, for when the comes to buy or sell.
Before we get started, I wanted to mention a great charity called ROAM.
They operate strictly on donations, and they do great work helping owners and pets re-unite! I have a couple of pets myself, and I know if they went missing I sure would love some help and support. Here is a link to their website: https://roambc.org/
Overview: Current Market Statistics
For July, I specifically chose condos under $550,000 as I feel that’s where a lot of the activity is taking place at the moment. If you look at July 2017, you can see one months’ worth of inventory. To get this total, you take the total monthly sales (July 2018) divided by the total inventory currently available on the market in that particular month. This is an interesting tool for us agents as it helps us gauge where the market is going. At this time last year, if nothing new came on the market, you would have had about a months’ worth of inventory left before you were completely sold out. When compared to July of this year, we have about 3 months of inventory, so the story is holding true in that lots more inventory continues to stack up in the market. Again, giving buyers an advantage where we are heading towards a buyers’ market. At the 6 months range we see a more balanced market, anything above 6 months is in favor of the buyers, whereas anything below is arguably in favor of the sellers. At one month we are leaning heavily towards a sellers’ market, with less inventory, and at 3 months, more towards the buyers’. The more inventory available, the more selection there is to choose from, producing less multiple offers and more negotiating. This is when you’ll start to see prices dip down a bit.
Another metric we use is Days on Market, so again for the condo market, average days on Market for condos under $550,000 this time last year was 21 days.
This year, in July we see it creeping up to 29 days. It’s taking longer for things to sell, and so it should, given that the inventory is starting to stack up now. Average sale price this time last year, which I think was a much hotter market, was $352,122 . When compared to 2018, the average sale price is up to $371,008. The prices are up, and that just goes to show that the numbers do tell a story. New demographics form mortgage qualifiers, like people not being able to qualify for townhomes anymore, are heading towards the condo market. So are investors who are looking for an investment to rent out. This graph is a representation of the inventory I spoke about. You can see that things are shifting as we get to the 3 month mark.
Let’s take a look at the list price average vs. sale price average. When you see that the list price is higher than the sale price, this typically means prices are being negotiated on, and that the market isn’t necessarily as hot. In the months where the yellow bar is higher than the red, this is where we see condos being sold for more than asking, and vice versa. Another indication of change.
Average Sales Price (July 2017 VS July 2018)
- Time frame: July 2017 to Aug 2018
- Listing Sub-Class is ‘Condo
- Price List is $550000 or less
- District is one of ‘Victoria’, ‘Victoria West’, ‘Oak Bay’, ‘Esquimalt’, ‘View Royal’, ‘Saanich East’, ‘Saanich West
- Results calculated from 1,583 listing
Buying: Is it a good time? The inventory has increased, so yes. There’s a chance you’ll run unto the odd multiple offer
here and there, be aware of the competition. I’m not really seeing many sales for a crazy amount over asking.
If you are competing, stay away from unconditional offers. You need to do your research and take your time when buying a condo. There’s a lot to consider. Reviewing all the documents that relate to the buildings health such as the financials, the depreciation reports and strata minutes. The building health is more important than the unit itself, that’s my opinion. This is where we see the majority the value is stored. For example, if the unit is in mint condition, and the building is falling apart, I would stay away from it! Here’s a few things you can do to help you protect yourself, besides having your realtor go over strata documents with you. You can hire a third party, such as a lawyer or Condoclear for this service. Keep in mind that here in Victoria we have a lot of older buildings, so make use of these services if you can.
Selling: Things to keep in mind when buying a condo: Location, location, location! Are you close to amenities such as schools, City or Town core? Are there any rental restrictions? Buildings with restricted rentals hurt overall value in my opinion. Keep a close eye on buildings constructed between 1985-2000; if you see a stucco exterior confirm the building has been or intends to be remediate. These items can cause a lot of unintended hardship to new owners. A healthy contingency fund is also important. See the link to an article about leaky condo’s.
Is it a good time to sell a condo? I don’t have a whole lot of advice to give here other than to be accurate and realistic with pricing. We’re still seeing some multiple offers on condos, and there is a lot of inventory compared to last year. You want to ensure you have a strong marketing plan to set yourself out from the competition. I’d say you’re still safe, but I don’t have a crystal ball!
As always, please feel free to leave any questions or direct message me. If you have ideas for content, please bring them to my attention! I can also be reached by email at firstname.lastname@example.org