There’s a new record for the average price of a single-family home in Victoria — $763,517 — an increase of 17 per cent from the same time last year.
For the third month in a row, the Victoria real estate market has posted record-breaking sales numbers. A total of 905 properties sold in the Victoria Real Estate Board region in May — a 26.8 per cent increase compared to the 714 properties sold in the same month last year.
According to Mike Nugent, president of the real estate board, Victoria neighbourhoods like James Bay and Fairfield continue to be hot spots for buyers, along with Oak Bay and Cordova Bay.
About 20 per cent of the buyers in Oak Bay were Vancouver buyers, which Nugent said are having a huge effect on prices. Multiple offers have now become the norm, with some listings selling 30 to 40 per cent over the asking price.
“They are used to seeing higher prices so it’s easier for them to be more aggressive when there are multiple offer situations than what a local buyer might do,” said Nugent, noting there’s still a low amount of listings in the most desired neighbourhoods. In May, Greater Victoria’s inventory of available properties was 2,406, down from 4,043 the previous year.
“The pressure is definitely on specific neighbourhoods.”
The pressure on single-family homes started last year when the city had a healthy supply of condos. But now, Nugent said that healthy supply is starting to disappear as well, which could push up the prices of condos. Already he’s seen multiple offers in the most desirable neighbourhoods.
Houses outside of the core (Victoria, Oak Bay, Saanich, Esquimalt and View Royal), however, continue to be reasonably priced. The average price of a home in the West Shore is $200,000 below Victoria due to a building boom that’s providing plenty of new inventory.
Nugent said it’s hard to predict what will happen in the future, but he doesn’t believe Victoria’s surging home prices will turn buyers away. The market has gone through similar cycles in the past, where the average price of a single family home has doubled.
Victoria’s economy also shows no signs of slowing down, with jobs drawing more people to the area, along with wealthy retirees. Nugent has also seen a shift in people cashing in on their homes in Victoria and moving to other parts of the Island, such as Cowichan Lake — which saw sales skyrocket last month.
As for getting into the red hot real estate market, Nugent said it’s important for buyers to have all their financial paperwork in place so they’re ready to pounce on a property. He also advised being open to other neighbourhoods other than the core.
“People need to be flexible. I don’t see the pressure coming off any time soon,” said Nugent. “It’s high stress for buyers and it’s also very difficult for even expert realtors to accurately guide sellers for a sale price.”