As with most years in real estate, 2018 real estate market on the Sunshine Coast has given us some twists and turns! We have seen some regulations that will change how real estate is conducted in British Columbia.
Most notably, the listing REALTOR® can no longer represent a buyer on that REALTOR®’s listing (no more limited dual agency).
Buyers have had to suffer the federal governments stress test even on uninsured mortgages, and this has had the desired effect of cooling the real estate market across the country.
Add to this some significant taxes levied on second homes and recreational dwellings in certain areas of British Columbia and the empty home tax in Vancouver and we end up with a depressed market.
Sunshine Coast Wild Card
The real wild card to pay attention to is the fact that prices in many areas of the market remain quite buoyant! While we have seen significant equity loss in the Lower Mainland, especially in very high-end properties, the Sunshine Coast has enjoyed a very minimal equity loss for property owners and an overall increase in value and equity in both detached and attached properties.
December 2018 was one of the slowest months in Real Estate on the Sunshine Coast in recent memory. Here is how it breaks down:
Detached home sales were down for December. Unit sales dropped 71% to 14 units sold. Dollar volume is almost the same – down 78% to $8,750,000. There are 279 active, detached listings and the closing ratio (the number of sales versus available inventory) was a little over 5% putting the market firmly in the buyer’s hands.
The year, as a whole, was not near as bad with unit sales down 29% to 514 homes sold. Dollar volume for 2018 is down 27% to $372,000,000. The average sale price for a detached home in 2018 was up 1% to $724,000.
Condos and Townhomes
Condo and townhome sales were down for December. Unit sales decreased 34% to 7 units sold. Dollar volume shift is almost the same as sales – down 35% to $3,155,000. There are 46 condos and townhomes for sale, and the closing ratio was 15% keeping this type of properties in a seller’s market.
The year as a whole is down considerably in the townhome and condo market with unit sales off last years mark by 40% for a total of 139 units sold. Dollar volume for 2018 is down 36% to $64,050,000. The average sale price of a condo in 2018 was up 6.5% to $462,000.
Land Only Sales
Land only sales were predictably down in December. Unit sales experienced a reduction of 54% to 5 units sold. Dollar volume is down 69% to $1,325,000. There are 188 land only properties for sale, and the closing ratio was 2.65% keeping this segment of the market in the hands of buyers.
The year as a whole in the land only market is down with unit sales missing last year’s mark by 24% to 152 and dollar volume telling the same story down 29% to $56,500,000. The average sale price for a land only property was down 6% to $372,000.
Outlook for 2019
Demand is down, inventory is up, and we still have an increase in values for detached homes, condos and townhomes.
I am optimistic about 2019 with these caveats:
Price your home competitively if you want to sell. Although prices are up, overall detached home sellers need to be savvy about how they compete with the other inventory.
Attached home sellers enjoy the most sought-after segment of the market but still need to be conservative in their desired asking price over the “last sale in the complex.”
Don’t wait out for this market because lots of folks are thinking the price is going to fall off but, as evidenced by 2018, this is unlikely to be the case in any way. If you find the right home or investment make the offer today with the price you want to pay. If you see just the right thing but wait, you will likely lose it or pay the same.
Things to watch for in 2019 are interest rate hikes, changes to the mortgage stress test requirements and inventory levels. The Bank of Canada has been very dovish in it’s most recent announcements regarding raising interest rates, and it is unlikely we will see a rate hike during the first quarter of 2019. Watch for any changes to the mortgage stress test. If there is a softening of the stress test, we will see more buyers enter the market. Watch for inventory levels to rise considerably making the competition factor for sellers greater.
Peace of Mind
Now, more than ever, it is essential to have a professional in your corner whether you are a buyer or seller. The market is nuanced and highly detailed, so it’s worth investing in the peace of mind that the assistance of a professional REALTOR® delivers.
Sunshine Coast Real Estate Market Statistics for November 2018
Home sales depress across all types of property on the Sunshine Coast, however, the average price, year to date, is still up over 2017! Let’s break it down by property type.
Detached home sales
Detached home sales in November were down 45% in dollar volume to $21,110,000 and down 40% in unit sales to 30 homes sold. Inventory is up 41% to 333 available detached homes for sale. Year to date we see a decline of 23% in dollar volume to $363,000,000 and a 26% reduction in unit sales to 500. These figures have remained quite steady for the entire year. The average price for a home on the Sunshine Coast last month was $727,000 which is up 3% from last year. The closing ratio (amount of sales versus available inventory) for last month was 9%, dipping us back into a buyers market (an under 10% closing ratio).
Condos and townhome sales
Condos and townhome sales in November were down 63% in dollar volume to $3,344,000 and down 56% in unit sales to 7 condos/townhomes sold. Inventory is up 22% to 53 units available. Year to date we see a decline of 36% to $61,000,000 in dollar volume and a 59% reduction in unit sales to 132. The average price for an attached home on the Sunshine Coast is $462,000 which is a 6.5% increase over last year. The closing ratio (amount of sales versus available inventory) for last month was 13% which is considered a balanced market (10 – 15% closing ratio).
Land only sales
Land only sales in November were down 36% in dollar volume to $3,400,000 and down 33% in unit sales to 10 land only properties sold. Inventory is up 5% to 208 units available. Year to date we see a decline of 26% to $55,200,000 in dollar volume and a 22% reduction in unit sales to 147. The average price for land only is $375,000 which is down 5% from last year. The closing ratio (amount of sales versus available inventory) for last month was 4.8% leaving this section of the market firmly in the hands of buyers.
We continue to see a decline in sales volume but no real decline in property values. Also, the year to date declines remains relatively steady month after month. Even those declines, when measured against a 10-year average, lead our team to believe that the market is adjusting to “normal” as it comes off an all-time high number of sales and low inventory experienced from 2015 to the end of 2017.
Bank of Canada rate increase in January 2019
With the loss of the car manufacturing plants in Ontario last month and the lowered production of oil in Alberta look to the Bank of Canada to NOT raise the prime in the early New Year and, possibly, the feds to revisit and soften the mortgage stress test.
For real market intelligence contact Russ, Ria and Terri from the Coast Lifestyles Network team!
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Sunshine Coast Real Estate Market Seeing Some Bright Spots (October 2018)
The residential real estate market continued to decline on the Sunshine Coast overall but has seen some bright spots this past month.
Detached Home Sales
Condos & Townhomes
Bare Land Property
Interest Rate Hikes
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To Grow or Not to Grow – Cannabis Legalization
Cannabis legalization was a big day across Canada with the recreational growing and consumption of cannabis for personal use. For those of our clients that enjoy this product, it is a good day….BUT…as your real estate advisors, we would ask you to carefully consider if you really want to turn your home into a grow op! Some details have yet to be worked out.
Here’s what you need to know about Cannabis Legalization and Your Real Estate Investment in BC Canada:
- Disclosure – even though it is now legal, if you are selling your home, you still need to disclose if you have used any room in your home, or even if you have an exterior area, to grow marijuana.
- How will this affect yours and/or a buyers ability to get home insurance? This is unknown as many insurers have not created policy around this question.
- How will this affect the ability to finance a purchase? This is also unknown but may affect the sale of your home in a negative way.
- If you live in strata, how does your council intend to “regulate” the growing of marijuana plants in individual units? Are your strata on top of this?
- If you own a rental property and have not addressed this issue with your tenants, in writing, then you should get on that immediately.
Are you considering growing at home?
The stats are in for September and the Sunshine Coast real estate market continues to decline significantly from last years’ highs. Lets break it down:
Detach sales are down in both units and dollar volume. The Sunshine Coast real estate market has declined 39% from last years’ highs with only 37 sales last month from last year. Total dollar volume came in at $25,4440,000 which is down 41% from last year. The average price for a detached home also fell from $750,000 to $690,000. This is a 8% drop.
Year to date the average price is still up 6% at $743,000 over last years $700,000. Total unit sales this year are down 24% to 421. The total units available for sale is up 25% to 383. Our closing ratio (total sales against available inventory) is 9.6% putting us in a buyers market for the first time in 36 months!
Condos and Town Home Sales
Condos and town home sales are down for both units and dollar volume. We saw 8 units sold compared to last years’ 17 units. Total dollar volume came in at $4,605,000 which is down 30% from last year. The average price of an attached home in September is a bit skewed at $549,000. The reason for the skewing was some high priced waterfront sales (879k and 794k respectively). The average price is up over last year by 22%.
Year to date we see that dollar volume is down 32% to $52,800,000 and unit sales closely match at 116 which is down 37% over last year. Total units available for sale are up 24% to 62. Our closing ratio is 12.9% showing this segment of the market to be balanced.
Land Only Sales
Land only sales are down slightly. September enjoyed 18 units sales…down only 1 unit compared to last year. Total dollar volume is down 14% to $8,000,000. The average price of bare land is down 7% to $600,000 but, of course, prices vary greatly depending on size and location.
Year to date we have seen the dollar volume slip 26% to $49,000,000 and units sales have slipped 21% to 126. Total available units for sale are down 8% to 200. Our closing ratio is 9% keeping land only properties in a buyers market.
Market considerations for home buyers and sellers
While the portion of the market that includes folks that have to sell or buy continues, those buyers that enjoy the luxury of creating their own timing are waiting “to see what happens”. The successful sellers are leading the market by asking a price that is not only competitive but off the astronomical highs of this past spring.
There is a lot of uncertainty around the provincial budget and municipal elections. Once the provincial budget is tabled and the elections are finished we should see a surge of sales until just prior to Christmas.
If you are considering entering the market contact Russ, Ria or Terri at Coast Lifestyles Network for market intelligence!
Real estate sales on the Sunshine Coast for the month of August showed some bright spots as we continue to watch how things settle and how the market will be affected further. Let’s break it down with market intelligence:
Detached Home Sales
Detached home salesfor August were the bright spot with $47,500,000 in sales volume. This is up 16% from the same time last year. Unit sales last month were down 14% to 54 detached homes sold. Ten of these sales were over $1,000,000 and one was at $5,000,000 hence the nonsensical results of less unit sales resulting in higher dollar volume.
Year to Date matches what has been happening with total sales dollar volume down 17% to $288,000,000. Unit sales are down also by 23% to 384 units sold in 2018 so far.
Total available listings are up 24% to 386. Our closing ratio (or sales versus available inventory) is 14% which keeps us in a balance market.
Attached home sales
Attached home salesof condos and town homes took a big hit for dollar volume over August. The Coast saw $3,850,000 in sales which is down 74% from last year. Unit sales tell us the same story with 8 units sold. This is down 72% from last year.
The year to date numbers are a little brighter with total dollar volume reaching $48,100,000 down 32% from last year. Units sold this year are 108 down 37% from last year.
Total available listings are up 24% to 63. Our closing ratio on attached sales is 13% keeping it just inside a balanced market.
Land Only Sales
Land Only Salesfor last month were at a total dollar volume of $2,400,000. This is down 73% from last year. Unit sales are down 68% to a total of 6. Year to date we have seen $41,000,000 in sales volume which is down 28% from last year.
Unit sales for the year are down 23% to 108. Total available listings are actually down 12% to 207. The closing ratio for Land Only is 3%…this sounds dismal but is on par, historically, for the Coast.
The summer was excruciatingly slow for real estate. As you know there were many variables from the weather (distractingly beautiful or smoky!), to the federal mortgage stress test, to the new taxes the provincial government will likely be introducing with the fall budget.
Buyers should be optimistic and upbeat!
You can now negotiate a deal rather than figure out how much you want to pay over asking price! There will be more choice in many segments of the market as well. Your best strategy for moving forward is getting pre-approved with your lender so you are ready to make the offer when the time comes. You also want to lock in to the approval for as long as possible (some lenders offer 120 days) as interest rates may rise again.
Sellers should strategize carefully before listing their homes.
You should clearly understand why you are selling (many folks, amazingly, cannot give a detailed reason for selling other than their equity position is huge) and what variables are important to you ie. timing, terms or price. Sit down with your realtor and figure out the path that will be the most rewarding.
For an answer to your real estate question call your realtor. For market intelligence call Coast Lifestyles Network!
Sunshine Coast real estate market continued to cool over the month of July 2018
The Sunshine Coast real estate market continued to cool over the month of July 2018. Less demand and higher inventory are resulting in some modest price reductions across all types of property.
Let’s break it down:
Detached home sales
Detached home sales were down 10% for gross dollar volume versus last year in July with a total of $43,250,000. Unit sales were down 16% to 54 homes sold. Year to date we continue to see a significant decline from 2017 totals with dollar volume down 21% to $240,100,000. Unit sales are down 24% to 330 detached homes sold so far in 2018. Total detached units available to market are up 18% to 372.
The closing ratio (the amount of unit sales versus available inventory)for July was 14.5% putting us in a balanced market for the second month in a row.
Condo & Town Home sales
Condo & Town Home sales were down 56% for gross dollar volume versus last year in July with a total of $2,860,000. Unit sales were down 42% to 8 attached homes sold in July. Year to date we see a decline in dollar volume of 21.5% to $44,350,000. Unit sales are down 29.5% to 100 attached homes sold so far in 2018. Total attached units available to market are up 15% to 54.
The closing ratio for July was 15% putting the condo and town home market into a balance position for the first time in several years.
Land Only sales
Land Only sales were down 36% for gross dollar volume versus last year in July with a total of $3,500,000. Unit sales were down 33% to 12 land only properties sold in July. Year to date dollar volume is down 19% to $38,550,000. Unit sales are down over the year by 17% to 102. Total land only units available to market aredown12% to 207.
What does all this mean for the real estate market?
Well, that’s a matter of opinion and here’s mine:) As usual any increase or decrease in the market pace is a result of several variables. We have the mortgage stress test as a variable – many buyers no longer qualify for entry level homes both in the Lower Mainland and the Sunshine Coast. We have an increase in available inventory across all property types which will also put some downward pressure on average dollar values. We see less demand by property buyers locally and from off Coast. Whether this is price “push back” or simply due to the lack of interest (it sure has been sunny and nice this summer) remains to be seen.
Some interesting observations
The average dollar value of detached homes & condos and town homes is increasing at the same time inventory is increasing. One would expect a reverse of this but it is not happening.
Detached home values are up 3% year to date yet inventory is also up 18%! Condos and town homes average sales price are up 11% while inventory is also up 14%. Land only properties sales price are down slightly by 3% and inventory is also down 12%!
Home Sellers should consider the overall trend and I believe that is – we are adjusting to the new reality for value yet one must be cognizant that there is more inventory to compete with. Don’t decide on value based on your competition. Decide your asking price using sold comparables as a reference. Being too ambitious in your asking price last year simply resulted in a few extra days on market. Being too ambitious this year can result in you not selling for months, having to adjust your price down (resulting in poor optics) and likely accepting a lower price later.
Home Buyers the market is balancing out for the most part and you won’t feel the same immense pressure to buy the first thing you see. While FOMO (fear of missing out) will continue to be a major variable in the condo and town home market it is no longer a factor for many detached home offerings. That said, the price of homes are unlikely to go down any more than what you can negotiate with an offer today so don’t wait if you need to buy. I’ve seen many buyers wait thinking the market is crashing only to miss out on the market entirely and continue to be in the position of having to rent.
If you have questions about buying or selling call us for real market intelligence.