Prime rate of Canada and consumer protection in BC produce cooling effect on the real estate market
Sunshine Coast Real Estate Snap Shot
All segments of the Sunshine Coast Real Estate market have shrunk both in dollar volume and unit sales. At the time of writing this report, the Bank of Canada had just announced another .50% increase in the prime rate with warnings of more increases to come. The British Columbia Financial Services Authority has made its’ recommendations to the Provincial Government with regard to consumer protection measures the government wishes to implement. Interestingly, they clearly said the recommendations would likely have unintended consequences and do very little for housing affordability. The latter will have an even more pronounced cooling effect on the market, at least temporarily, while the industry, and Buyers and Sellers, adapt to the new rules. Meanwhile, let’s see how last month rolled out.
Detached homes sales are down in dollar volume by 22% compared to last year’s $66,600,000, and unit sales are down by 35% to 55 homes sold in May. The number of available listings is up 16% to 212…This means our sales success ratio is 26%. While we still consider this sales success ratio a “seller’s market”…,with the increase in inventory and reduction in sales, this percentage has halved since last month. Year to date shows us down 12% in dollar volume to $340,000,000 and unit sales down 26% to 283 homes sold in 2022 so far. The average home price is up by 19% to $1,200,000.
Condos and Town Homes are down in dollar volume by 28% to $11,525,000 and unit sales by 33% to 20 homes sold in May. The number of available listings is down 22% to 39 condos and/or townhomes available for sale. This means our sales success ratio is 51%! This segment of the market, due to lack of inventory, continues to be a sellers’ market. Year to date, we see that dollar volume is down 24% to $56,000,000, and unit sales are down 35% to 87 homes sold so far in 2022. The average condo/townhome price is up by 15% to $644,000.
Land only is down 67% in dollar volume to $5,150,000 and down 68% in unit sales to 9 land-only properties sold in May. Inventory is down significantly from last year. 47%, to be exact, to bring available inventory to 65 lots. This means the sales success ratio for this segment of the market is 14% putting it firmly in “balanced market” territory. Year to date, we see dollar volume down by 12% to $59,000,000 and unit sales down 31% to 93 lots sold in 2022. The average price for a piece of land is up 26% to $635,000.
I’ve noticed fewer multiple offer scenarios playing out, and sellers are starting to negotiate off their asking price! The soft spot seems to be between 1.3 million and 2 million. Lower than that is brisk, and surprisingly, the higher end continues to chug along very nicely.
