|Victoria Real Estate Market Adapts to Changing Policy Landscape
A total of 545 properties sold in the Victoria Real Estate Board region this February, 19.3 per cent fewer than the 675 properties sold in February last year. The sales of condominiums were down 15.5 per cent from last year in February with 174 units sold. Single family homes were 24.4 per cent down from the year previous, with 260 sold this February.
“We certainly anticipated that we would see some lower numbers this year compared to last,” says Victoria Real Estate Board President Kyle Kerr. “Right now prospective home buyers are met with many hurdles as they start shopping for their new home. They’re in a market that’s experienced long-term low inventory, which means more price pressure and competition on homes. Buyers are navigating increasing interest rates and the new mortgage stress test. These factors all combine to constrain our market. Like any changes to consumer experience, there is a period of response before consumers adapt to the new rules. We saw an increase in buyers in November and December who bought early to avoid the mortgage stress test, and this likely means less buyers in the current market. However, with continued historical low inventory levels, demand is still outpacing supply.”
There were a total of 1,545 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of February 2018, an increase of 3.6 per cent compared to the month of January and 0.5 per cent more than the 1,537 active listings for sale at the end of February 2017.
“The provincial government recently rolled out its budget, which includes an admirable commitment to spend six billion dollars to build 114,000 units in ten years,” adds President Kerr. “These units will take years to come to market, and it is difficult to predict how many we will see in Victoria. The government needs a long-term approach to supply needs in our area, and that initial commitment is a good start. A reasonable way to bolster their commitment and improve current conditions is for the province to work with our municipalities to reduce the timelines and costs associated with bringing new housing to our market.”
The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in February 2017 was $771,100, while the benchmark value for the same home in February 2018 increased by 9 per cent to $840,300, slightly higher than January’s value of $831,900. The MLS® HPI benchmark value for a condominium in the Victoria Core area in February 2017 was $394,400, while the benchmark value for the same condominium in February 2018 increased by 19.85 per cent to $472,600, which is slightly higher than January’s value of $460,500.
Tejpaul Wirk from Mullin Demeo came and talked to us regarding Probate.
Selling prior to probate
It is highly recommended that a property not be marketed until probate has cleared. Selling prior to probate can cause collateral issues on all ends.
Avoiding probate fees:
A question came up regarding estate tax and probate. A property owner may consider putting their children’s names on title in order to save the probate fee (currently 1.4%). Tej said this can open a number of issues including exposure to Capital Gains Tax, and credit issues caused by debts incurred by a child. In most cases it is safer to leave the title as is. It is always prudent to talk to your lawyer and financial planner regarding estate issues.
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|Victoria Real Estate market begins the new year with low inventory and high demand
February 1st, 2018
A total of 431 properties sold in the Victoria Real Estate Board region this January, 9.8 per cent fewer than the 478 properties sold in January last year. The sales of condominiums were down 30.6 per cent from last year in January – with 118 sold. Single family homes were 4 per cent down from the previous year, with 215 selling in the first month of 2018.
“We expected January to be a bit slower after the increase in activity we saw in November and December, which was likely due in part to buyers entering the market early to avoid the new mortgage stress test,” says 2018 Victoria Real Estate Board President Kyle Kerr. “We have yet to see the full effect of the stress test, as many people attained a 90 -120 day pre-approval before the test became required January 1. We won’t know how much that stress test will affect the spring market until we see the numbers, and spring is also the time when sales traditionally pick up.”
There were a total of 1,491 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of January 2018, an increase of 7.7 per cent compared to the month of December and 1.6 per cent fewer than the 1,516 active listings for sale at the end of January 2017.
“2017 concluded with very constrained inventory levels, which hit record lows early in January. The lack of inventory in our market is maintaining pressure on pricing, especially as high demand continues in many areas of Victoria,” adds President Kerr. “We can also see the effects of headwinds influencing our market in 2018, including attempts to curb demand at all levels of government. The mortgage stress test is the latest to be introduced, and we may learn of further measures later this month when the provincial budget is released. We hope the government takes a balanced approach to our housing market in their budget and offsets any further demand-side measures with initiatives aimed at addressing the ongoing supply shortages for both home buyers and renters. We also encourage our local governments to take some time to assess the effects of demand-side measures like the mortgage stress test and recent interest rate hikes before introducing further restraints on our market.”
The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in January 2017 was $761,100. The benchmark value for the same home in January 2018 increased by 9.3 per cent to $831,900, slightly higher than December’s value of $823,800. HPI benchmark value for a condominium in the Victoria area in January 2017 was $375,300. The benchmark value for the same condo in January 2018 increased by 20.1 per cent to $450,600, which is slightly higher than December’s value of $445,000.
About the Victoria Real Estate Board – Founded in 1921, the Victoria Real Estate Board is a key player in the development of standards and innovative programs to enhance the professionalism of Realtors. The Victoria Real Estate Board represents 1,357 local REALTORS®. If you are thinking about buying or selling a home, connect with your local Realtor for detailed information on the Victoria and area housing market.
Courtesy Victoria Real Estate Board
If you have ever purchased a strata property you know how confusing the parking designation can be. Designations can include LCP (Limited Common Property), Common Property with spot assigned by Strata, and may also include a lease. Starting in January 2014 the Strata Form B document will have to include the parking information. It is always prudent to verify the information by viewing the Strata Plan, Common Property Title & General Index. This information is publicly available by visiting the Land Title Office. The General Index is particularity important is it may show a change in designation not evident on the Strata Plan. As an example parking may change from Common Property to Limited Common Property by way of a general resolution, outlined in the General Index.
Most people understand the value of signing an agreement to work with a REALTOR® when it comes to selling their home. But let’s examine the value of signing a similar agreement – an Exclusive Buyer’s Agent contract – when it comes to buying a home.Understanding Agency In British Columbia, A Designated Agent is a specific agent within a brokerage that has been designated to work exclusively with a particular client. This legally separates that agent from all other agents within the brokerage as someone who will work solely for that client.
There are three types of agents: seller’s agent, buyer’s agent, and dual agent.
Seller or “listing” agents are legally obligated to represent the seller’s interests. This includes securing the best possible sale price with the terms most agreeable to the seller. It also includes maintaining absolute confidentiality for the seller and disclosing information about buyers or would-be buyers. The Seller agent’s absolute loyalty is to the seller, and only the seller.
A buyer’s agent represents only the buyer’s interests. The buyer’s agent has a duty to maintain the buyer’s absolute confidentiality, disclose information about the seller, research and advise the buyer on properties, and negotiate for the best possible price on behalf of the buyer.
Dual agency is when an agent or broker represents both the seller and the buyer and, to avoid conflict of interest by the REALTOR®, neither party can be fully represented. A REALTOR® in a dual agency is truly more of a referee or mediator for the transaction. Both the buyer and the seller must agree to allow the REALTOR® to act in a dual agency role. Dual Agency will likely disappear in 2018, more details are to be released by the Office of the Superintendent of Real Estate this spring.
Advantages of Hiring a Buyer Agent
When you sign an Exclusive Buyer’s Agent contract, you are agreeing to “hire” a personal representative who, by law, must represent your interests to the best of his or her ability.
A buyer’s agent will start by thoroughly evaluating your specific needs to help you locate the right property. He or she will become your personal specialist, seeking out properties, providing property and neighbourhood information, and carefully analyzing the market to help you make informed decisions. He or she will take you to see the properties you are interested in, and help identify any problems or issues.
Once you find the perfect home, your buyer’s agent will thoroughly explain and prepare the many detailed forms necessary for a purchase, help you structure your offer, and present the offer on your behalf. He or she will negotiate hard for the best possible purchase price and terms, and continue to work with you to ensure a smooth closing.
A buyer’s agent can also help guide you in securing appropriate financing and offer references to other services like home inspectors, movers, lawyers, and home improvement contractors. These services are especially helpful to out-of-town buyers who may not be familiar with the area.
The Exclusive Buyer’s Agent contract
If you choose to hire a buyer’s agent then you should clarify this relationship in a written legal contract, an Exclusive Buyer’s Agent contract. This outlines the terms of the relationship between you and your buyer’s agent, including the purpose of the relationship, the services offered, the duration of the agreement, and the terms of compensation.Making expectations clear right from the start – and putting them in writing – helps ensure your expectations will be met.
Victoria Real Estate Market Strong to the End of 2017
January 2nd, 2018
A total of 462 properties sold in the Victoria Real Estate Board region this December, 1.9 per cent fewer than the 471 properties sold in December last year.
A grand total of 8,944 properties sold over the course of 2017, 15.8 percent fewer than the record breaking 10,622 that sold in 2016. 2017 sales came in at 21.7 per cent over the ten year average of 7,349 properties sold.
“Early in 2017 we discussed how the Victoria area housing market would be different than the record breaking year we had in 2016 and that over the course of the year we’d probably see a gradual return to a more balanced market. We did see evidence of this change come early in the year, as multiple offers and rapid price increases leveled out,” says Victoria Real Estate Board President Ara Balabanian. “However, the ongoing low inventory of properties for sale meant that buyers continued to experience competitive situations in high demand areas, and
multiple offers were still a common occurrence as buyers negotiated in a tighter market. What we couldn’t anticipate were outside factors such as changes to mortgage qualifying rules that may have pushed people into the market early. The pending mortgage stress test in particular is likely to have caused much of the increased activity we’ve seen in November and December.”
There were 1,384 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of December 2017, a decrease of 21.5 per cent compared to the month of November and 7.3 per cent fewer than the 1,493 active listings for sale at the end of December 2016. This is the lowest level of inventory for the area in the month of December since the statistic was tracked in 1996.
The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in December 2016 was $753,900. The benchmark value for the same home in December 2017 has increased by 9.3 per cent to $823,800, and is slightly lower than November’s value of $824,600.
“Overall, the low inventory and the continued interest in Victoria real estate meant that well-priced homes were quick to sell in 2017. Moving forward, we expect to see more inventory come into the market, which will continue to move us toward a more balanced state,” adds President Balabanian. “We also expect housing prices to
remain stable, without the increases we tracked in 2016, and anticipate steady slow growth. In markets like these, it’s important to enlist the services of a REALTOR® to help you navigate what may be your largest transaction ever.”
About the Victoria Real Estate Board – Founded in 1921, the Victoria Real Estate Board is a key player in the development of standards and innovative programs to enhance the professionalism of Realtors. The Victoria Real Estate Board represents 1,374 local Realtors. If you are thinking about buying or selling a home, connect with your local Realtor for detailed information on the Victoria and area housing market.
Victoria Real Estate Market Experiences a Burst of Activity
December 1, 2017
A total of 671 properties sold in the Victoria Real Estate Board region this November, 12 per cent more than the 599 properties sold in November last year.
“We suggested last month that some buyers may accelerate their purchase timeline to buy a new home in anticipation of the mortgage stress test on uninsured buyers – those with a down payment of 20 per cent or more – that will come into effect on January 1,” says Victoria Real Estate Board President Ara Balabanian. “Judging by the sales we saw in November and what I have heard from our REALTOR® members, some buyers have indeed accelerated their purchasing plans to avoid the stress test. This may change the numbers we see in the early months of 2018, as some buyers who had planned to buy next year have bought a bit earlier.”
There were 1,764 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of November 2017, a decrease of 7.4 per cent compared to the month of October and 2.8 per cent fewer than the 1,815 active listings for sale at the end of November 2016.
The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in November 2016 was $748,500. The benchmark value for the same home in November 2017 has increased by 10.2 per cent to $824,600, which is slightly higher than October’s value of $821,900.
“So was this November a record breaker?” asks President Balabanian. “While not a record, it is the highest November sales count we’ve tracked since 1996. It is also rare that we see November numbers beat October numbers. The fact that we’ve had an unusual month does not necessarily mean that this is the start of a new trend, it is however, a good example of how outside forces can impact a housing market. It’s likely there will be more government-led change in the new year and we’ll report on the effects of those changes on the market. Our hope is that the different levels of government coordinate their efforts to avoid a negative compounding effect on the market.”
Russell Cass from Home Check was here this morning to give us a better insight on depreciation reports. Some of the points Russell made were:
a depreciation report is nothing more than a home inspection with a maintenance budget
a report is good for 3 years
these reports are often difficult to read. As a Buyer it may be prudent to have a third party analyze and explain the document. [Ask me, I can help!]
a Strata can vote against having a depreciation report done but they have to revisit that every 18 months
*STRATA REGULATION REQUIREMENTS OF A DEPRECIATION REPORT
E&O or Statement of NO cover
Relationship with Strata if any
Must state site was visited
Exterior- Roof, Roof Decks, Doors, Windows, Skylights
Systems- Electrical, Heating, Plumbing, Fire Protection, Security Systems
Common Amenities and Facilities
Parking Facilities and Roadways
Utilities, including water and Sewage
landscaping, including Pathways, Sidewalks, Fencing, Irrigation
Interior Finishes including Floor Coverings and Furnishings
Balconies and Patios
Identify Common and Limited Common Property that the Lot owner is Responsible to maintain and not the Strata
Anticipated maintenance/Repair (more than annual)
Replacement Costs (more than annual)
Projected 30 years (use current or previous year financials)
Describe Factors and Assumptions, Interest Rates, Rate of Inflation
Describe Contingency Contributions
Balance in Contingency Fund (minus funds allocated but not removed)
Projected over 30 Years
Beginning with Current or Previous Fiscal Year
Show either or any of a) Fund Balance and Withdrawals b) Special levies c) Borrowings
*As interpretted by Russel Cass of Home Check
Victoria Real Estate Market Slowly Stabilizing after a Record Breaking 2016
A total of 664 properties sold in the Victoria Real Estate Board region this October, 9.7 per cent fewer than the 735 properties sold in October last year.
“As expected, we saw fewer sales than this time last year,” notes Victoria Real Estate Board President Ara Balabanian. “Looking at the longer term picture however, sales last month were 17.1 per cent above the ten year average of 567 properties for the month of October, so the market is still very active here in Victoria, and this is in spite of the ongoing low inventory levels.”
There were 1,905 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of October 2017, a decrease of 3.6 per cent compared to the month of September and 1.7 per cent fewer than the 1,938 active listings for sale at the end of October 2016.
The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in October 2016 was $752,000. The benchmark value for the same home in October 2017 has increased by 9.3 per cent to $821,900, but is lower than July’s value of $834,200.
“The fact that we’ve seen such a controlled levelling off in the market directly following a year which felt so uncontrollable in terms of demand and pressure on prices illustrates the depth and stability of the Victoria market. An unstable market may have experienced a heavy correction or shift, whereas in our market sales are moderating at a reasonable rate.” adds President Balabanian. “In the coming months we expect to see less inventory on the market, because the year end changes buyer and seller behaviours, their focus shifts to holidays and winter weather. One unknown influence that may play on the winter market is the upcoming mortgage stress test. Some buyers may move their purchasing timelines forward to make their home purchases before the stress test on uninsured buyers (those with a down payment of 20 per cent or more) becomes required January 1.”
About the Victoria Real Estate Board – Founded in 1921, the Victoria Real Estate Board is a key player in the development of standards and innovative programs to enhance the professionalism of Realtors. The Victoria Real Estate Board represents 1,364 local Realtors. If you are thinking about buying or selling a home, connect with your local Realtor for detailed information on the Victoria and area housing market.