Where is the Victoria BC Real Estate Market Heading in 2024?
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- Опубліковано 28 чер 2024
- With 2023 coming to a close it gives us a great opportunity to reflect on what has been a turbulent year in the Victoria BC real estate market. Vancouver Island real estate and BC have experienced similar turmoil through the year. Where is the Victoria BC Real Estate Market Heading in 2024?
My Victoria BC real estate predictions for 2024 in this video!
There have been a lot of ebbs and flows in the Victoria Housing Market with mortgage interest rates, which have had an effect on overall demand in the market. With most major banks offering posted rates above 6%, we are in an entirely different environment than we were just a couple of years ago. The retraction in sales over the last 2 years is probably the best indicator of this that we have:
Unit Sales (Victoria Real Estate Board)
2021: 10,192
2022: 6,924
2023: 5,941
Through sluggish month in sales activity in Victoria BC Housing, our inventory has built to levels not seen since the summer of 2020 during the C-19 lockdowns. Over the last 5 years we have consistently reached our peak of active listings in July, but 2023 has been different. Our peak of listed inventory actually occurred at the end of October (2,776) and marked the 10th consecutive month with more property available than the month previous.
New listings through the fall have outpaced demand and November 2023 had more new listings (858) than any November in the last decade. There is reason to believe that more owners with homes coming up for renewal are deciding to sell than we have seen in recent memory. The conversion of some of these sellers coming to market with below-average demand has led to downward pressure on prices.
Buyers and sellers have to come together to inform this data, and in some cases the backdrop of better market conditions in 2024 has some sellers heading for the sidelines instead of relenting to lower offers in the fall of 2023. Will they have more luck in 2024?
There is reason to believe that we have reached the peak of interest rates/mortgage rates and that as 2024 unfolds, downward pressure on both fixed and variable rates could mean that the market wakes back up again for real estate in Canada (Canadian Real Estate). October's CPI data saw another decline from the previous month (3.8%) mainly due to falling year-over-year gasoline prices. The most significant contributors to inflation remain mortgage interest costs, food purchased at stores, and rent.
Excluding food and energy, inflation fell to 2.7% in October, down a tick from the September reading. Two other inflation measures closely tracked by the Bank of Canada (trim and median core rates) also eased, averaging 3.6% from an upwardly revised 3.8% a month earlier.
The next piece of relevant data was the Q3 GDP release from Statistics Canada. The economy in the third quarter shrank at a 1.1 percent annualized pace, much weaker than the Bank of Canada’s forecast of +0.8 per cent. The contraction almost wiped out all the growth from an upwardly revised 1.4 per cent increase in the second quarter and presents stark contrast to the 2.5% growth rate for Q1 2023.
The two consecutive quarters of GDP at near 0 per cent, accompanied by flat household spending -- the weakest half-year since 2009 outside the pandemic, suggest the economy has essentially stalled, losing much of the strong momentum seen early this year. This reinforces the view that the Bank of Canada's interest rates are sufficiently restrictive to crimp consumption and slow inflation. The Bank of Canada confirmed this sentiment this week by leaving their overnight rate unchanged at 5%.
The bond market has responded and the Government of Canada's 5 year bond yield has fallen from a peak of 4.41% at the end of October to 3.37% at present. As this yield is a significant component of the spread for fixed rate mortgage products, it could mean that lower fixed rates are on the horizon.
Unless there is a deep recession that triggers job losses and unemployment, I will continue to expect that falling rates will have an effect on backstopping further price declines, and that 2024 will more than likely be a return to a balanced market, with stable and slow growth in prices across all segments.
00:00 Intro
00:37 2023 Recap
02:27 Looking Ahead
05:33 Real Estate News
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Alex Carroll is a licensed real estate professional in the province of British Columbia serving the Greater Victoria Real Estate Market
Alex Carroll PREC*
Licensed Victoria Realtor
Engel & Völkers Vancouver Island
alex.carroll@evrealestate.com
alexcarroll.ca
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Merry Christmas Everyone! 🎄
Thanks for this, very informative and timely as several members of our family are contemplating a move from the B.C. Interior. Happy Holidays and hope inventories stay healthy for you in the new year!
@@pseudocynic1 Excellent thanks for the feedback! Wish them well with their upcoming moves!
The zoning changes are huge! I think we'll see our neighbourhoods transform when the next boom market arrives. Also glad to see temperature limits in the new building code. So many new condos don't have AC. Hats off to David Eby
It's unfortunate that we weren't here sooner but steps like these should help untangle the log jam of structural supply constraints throughout the province over time. Very positive!
Short term things are fucked, long term things are fucked
These rates are brutal. Been developing duplexes and town homes here in the Kootenays since 2013. Sitting on my last of 4 units built since late 2021. Waiting…
Could be a turnaround here in the next 6-12 as long as there aren’t any black swan events
Agreed. I was in the same position this time last year with two units on the market making for a pretty stressful new year, but got really solid offers on both of them and closed during February and March and went into the spring ready to finish the next two units. Just got to bear down. Things can only get better. So lucky to live in this beautiful province.
@@allenleclerc7878 Absolutely! All the best with the transactions moving forward and here’s to a positive year ahead!
HI Alex, your content is really helpful
Thanks for the feedback! I’ll keep it coming in 2024!
Dear Alex your youtube channel videos are very good❤🩹. But The videos are not properly SEO and promotion. Video & channel on-page, off-page SEO is not done. If everything is done professionally. Then the video will show on the fast page in the UA-cam search list.❤🩹 Which is UA-cam Recommended. Videos will rank faster. Thank you❤🩹. Ican hep you@@AlexCarroll
Me interesa de un casa de afito Ana Maria
Rule number one: don't listen to RE agent's predictions Rule number 2: listen to economists.
TD has called for 10% decrease which means places like BC with airbnb Bans will be hit harder and could see 15% declines.
Personally I am waiting to 2025-2026 for more discounts.
Would you say TD’s call is for all of Canada or for Victoria specifically?
If you watched the video you would see some of comments on Airbnb. The ban isn’t effective until next year but most owners that have to sell aren’t waiting until then to get to market. I have some reservations in thinking that less than 100 condos being added to the listed inventory is going to have a meaningful impact on the broader condo market outside of those few buildings..
Anyways it will be interesting to see how it plays out. I wish you well with your search. I’ll definitely come back here and give you and TD your roses if home prices pull back by 15% next year.
You failed to address the tax implications of if people simply convert airbnbs to LTR. I see a pullback as the economy on the whole is not looking good.@@AlexCarroll
@@rachelk8368 I tried to just keep it as an overview. For one reason or another if an STR owner has to sell they will. I would posit that we have seen a good chunk of the “have tos” already although some are waiting to see what happens with legal challenges, potential for zoning changes, etc
Why would you listen to economists? That's like listening to the Fed predict interest rates, their accuracy isn't much better than that of pure chance.They don't call economics the dismal science for nothing.
2:34... you guys need to get rid of this...
Sorry what do you mean by this?
@@AlexCarroll I meant the current government,..
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