Welcome back to my market updates post! I will continue to update this Victoria, British Columbia, real estate market page at the beginning of each month.
This post’s data, housing prices, statistics, and property information are from the Vancouver Island Real Estate Board Region. Alright, let’s get to it!
In total, 460 residential properties sold in the Victoria Real Estate Board region during February 2023. The number of sales is 35.9% less compared to the 718 properties that sold in February 2022 but a 65.5% increase from January 2023.
Condo sales in January 2023 were down 39.7% compared to February last year (2022), with 161 units sold.
In addition, sales of single-family homes decreased 28.8% from February 2022, with 220 sold.
At the end of February 2023, there were 1,809 active listings for sale on the Victoria Board MLS®. An increase of 4% compared to the previous month of January 2023 and a 113.1% increase compared to the 849 active listings at the end of February 2022.
The real estate market in 2022 began with record low housing, high demand for properties, and higher-than-average home sales. Near the middle to end of 2022, we saw rising interest rates and buyer demand decrease as homes became less affordable. As a result of less demand, market activity slowed down.
However, as we enter the spring market in 2023, we are starting to see buyer demand bounce back. Compared to last February (2022), we have about 1,000 more active listings for a total of 1,809 active listings at the end of February 2023 compared to the 849 active listings at the end of February 2022.
In BC, the Home Buyer Rescission Period (HBRP), also known as the “cooling off period,” came into effect on January 3rd, 2023.
The Home Buyer Rescission Period is intended to allow home buyers to rescind their offer up to three business days after their offer was accepted.
The three business days begin the day after the accepted offer is signed. For example, if the offer is accepted on Monday, the buyer’s rescission period would end at 11:59 p.m. on Thursday.
Suppose subject conditions are included in the offer (such as buyer financing, home inspection, strata document review, etc.). In that case, these conditions will run concurrently with the three-day home buyer rescission period.
The seller, buyer, or their representatives can’t waive the rescission period. During the rescission period, a homebuyer can withdraw from the signed contract (for no reason), but the cost of the rescission fee is 0.25% of the purchase price. For a purchase price of $500,000, the buyer rescission fee would be $1,250.
Although interest rates have increased, this market can be a great opportunity for home buyers. Buyers can purchase a home with less competition and may have more time to do their due diligence and look at multiple homes before making an offer.
On the supply side, high building costs, limited availability of construction workers and labour in general, zoning restrictions and regulations all reduce the pace and the number of homes coming to market.
So even though interest rates have increased (impacting only buyer demand), there is still a supply and demand imbalance in the Victoria housing market. In the short-term and long-term, lack of supply will continue to be an issue for the affordability of homes in Victoria and surrounding areas unless steps are taken to add gentle density to neighbourhoods.
The total residential sales over the total active residential listings ratio is a measurement of supply and demand and is expressed as a percentage at months-end. This measurement is the percentage of available listings that have sold in a specific month.
The ratio can provide buyers, sellers, and their real estate agents an understanding of whether we are in a buyers’ market, sellers’ market, or a balanced market.
When the percentage of sales to active listings is in the 15-20% range, there is little pressure on home prices either way, and it is typically considered a balanced market.
However, when the sales to active listings percentage falls below 10%, there is downward pressure on prices, which is considered a buyers’ market.
Alternatively, when the sales to active listings percentage increases above 25%, there is upward pressure on prices, which is considered a sellers’ market.
For February 2023, the sales to active listings ratio increased to 31%, indicating an 11% increase from the 20% sales to active listings ratio in January 2023.
The Victoria, BC, real estate market is very dynamic, and many factors can influence market conditions. If you have any questions about the Victoria real estate market or if you’d like to know what your home is worth in today’s market, I can prepare a free, comparative market analysis for you. Easily send me a message on my contact page or email email@example.com. I look forward to hearing from you!
*Disclaimer: The topics of discussion, content and resources on this website are general information that may not be the right solution or advice for you specifically. Not intended to solicit buyers or sellers currently under contract with a brokerage.
*Stock images from Social Squares
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This July update for Victoria’s real estate market was helpful for me because I invested in a property in that real estate market. Without the details shared here, I wouldn’t have been able to do it.
This blog really helped me understand the madness out there. Thank you for breaking it down so clearly and putting it into terms that anyone can digest.
Hope to be working with you in the future!
[…] – By Ria Mavrikos on Victoria Real Estate Market […]