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Most notably, the listing REALTOR® can no longer represent a buyer on that REALTOR®’s listing (no more limited dual agency).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.