The capital region’s real estate market saw sales and prices drop in August, according to numbers released Tuesday by the Victoria Real Estate Board.
A total of 661 properties changed hands last month, down from the 706 in July, while the benchmark price of a single-family home in the region slipped to $748,500, down from $756,000 in July.
Despite the drop, it was deemed normal by the board.
“August could be considered a status-quo month for real estate in Greater Victoria with entry-level homes selling quickly when priced appropriately, and higher-end properties moving at a slower pace,” said VREB president Cheryl Woolley.
Compared to July, there were some slight improvements with single-family home sales in the region up 1.7 per cent to 308, but condominium sales slipped 5.6 per cent to 203 and townhome sales dropped by 33.7 per cent to 59.
The number of active listings were also down in August with 2,838 properties active at the end of the month compared to 2,949 at the end of July.
“Unfortunately, summer has been accompanied with a slowing of new inventory coming onto the market,” said Woolley.
The year-over-year numbers showed the market was busier this August.
The 661 total sales was a slight improvement over the 594 in August 2018, and there was a 12.7 per cent increase in the number of active listings compared to the 2,519 at the same time last year.
But while there was a significant increase in the number of sales of single-family homes over the last year — 308 in August 2019 compared with 259 at the same time last year — single-family home prices have slipped over the last 12 months.
The benchmark price of a single-family home in the region was down 1.8 per cent from $762,000 last year. Condo prices have increased 2.4 per cent in that time to $506,100 and townhome prices are up slightly to $598,800.
Woolley said the board will be keeping an eye out for what effect the federal government’s First Time Home Buyer Incentive program, which starts this month, will have on the market.
“We’re pleased the government is looking at creative ways to get first time buyers into homes as this program will help some buyers in Canada’s smaller markets,” she said. “We look forward to hearing how the federal government plans to help first time buyers in larger markets like Victoria, perhaps by adjusting the mortgage stress test parameters and extending the length of mortgage amortizations.”
The First Time Home Buyer Incentive allows Canada Mortgage and Housing Corporation to provide up to 10 per cent funding for mortgages on new builds and up to five per cent on existing homes.
The incentive applies to buyers with an annual household income of less than $120,000 and a five per cent down payment. Buyers have to repay the incentive over 25 years or when the property is sold.
• Meanwhile, sales of single-family homes listed by the Vancouver Island Island Real Estate Board (areas north of the Malahat) in August dipped by 11 per cent year over year and were nine per cent lower than in July.
Last month, 413 single-family homes sold on the Multiple Listing Service, compared to 453 the previous month and 463 in August 2018. Year-over-year sales of condos and townhouses dropped by 28 per cent and 25 per cent, respectively.
Realtors are reporting the housing market is adjusting as buyers adapt to the restrictions imposed by the mortgage stress test and sellers curb the expectations formed during the booming markets of 2016 and 2017 and, to a lesser extent, 2018.
In the VIREB area, inventory of single-family homes in August rose by 11 per cent from one year ago (1,343 to 1,485). Active listings of condos increased by 23 per cent (299 to 369) year over year while townhouse inventory is virtually the same as reported last July (176 to 173).
Prices in the VIREB area are still rising. The benchmark price of a single-family home was $515,400 in August, a three per cent increase from one year ago and up slightly from July.
In the condo category, the year-over-year benchmark price also rose by three per cent, climbing to $302,800 and marginally higher than in July. The benchmark price of a townhouse rose by five per cent board-wide, hitting $417,300 last month, which was two per cent higher than July’s benchmark of $410,600.
Regionally, the benchmark price of a single-family home in the Campbell River area last month was $445,100, an increase of 10 per cent over August 2018. In the Comox Valley, the benchmark price reached $518,200, up by two per from one year ago. Duncan reported a benchmark price of $474,400, an increase of four per cent from August 2018. Nanaimo’s benchmark price rose slightly to $560,200 while the Parksville-Qualicum area saw its benchmark price increase by three per cent to $590,000. The cost of a benchmark single-family home in Port Alberni reached $318,200 in August, a five per cent increase from one year ago.