Tag Archives: Ganges Village

Market Analysis, December 2016, Salt Spring Island

A small geographic space with a world-sized heart…that’s a good description of Salt Spring Island and the Southern Gulf Islands.

Hastings House

Hastings House

The Islands Trust, created by the Provincial Government in 1974, with a mandate “to preserve and protect” the environmental beauties of the Gulf Islands, for the benefit of all B.C. residents, has effectively controlled growth on all the Islands via strict zoning/density bylaws.

Salt Spring Fire Department

Salt Spring Fire Department

If you go up in a floatplane, en route from Ganges Village on Salt Spring to Vancouver, you will see the large swathes of green on the Gulf Islands…a mix of provincial and federal park reserves, CRD park reserves, Conservancy protected lands, owner gifted or covenanted land…an amazing natural gift to visitors and residents alike. The Gulf Islands have all been preserved from unbridled development.

Important, though, in this non-municipal form of governance, that 1974 is paying attention to 2016. The big problem in cities and towns seems to revolve around affordable housing. This is a problem on Salt Spring, too.

There is a range of age-groups and affluence on Salt Spring…a broad spectrum of people desiring to live here. There are no work-rentals, no affordable buy-in living options, and very few choices for the aging boomers to move to, when downsizing. So…few starter homes, no rental apartments, few downsizing choices. Hmmm….

Salt Springers are being asked if they would like to become incorporated in a Gulf Islands Municipality structure. The two elected Trust people (two per island) & the Trust documents would remain in place. The day to day running of the island would be via an elected Council (one of whom would act as Mayor). Keep informed!

On Salt Spring, December brings craft fairs (WinterCraft at Mahon Hall, plus Fulford and Beaver Point Craft Fairs), seasonal theatre & choral events at ArtSpring, gallery openings, studio tours, light-up in Ganges Village, Christmas on Salt Spring events, pop up markets in the park…special menus in our superb restaurants. Seasonal delights await the visitor!

What about that real estate market?

And, what about that real estate market? As we close out 2016, one can look back and see an upticking market. After an 8 year downturn in the secondary home coastal markets (Sunshine Coast, Victoria, Vancouver Island, Gulf Islands), Salt Spring finally saw a shift into a dramatic sales volume increase between mid-March and the end of July. Buyers were mainly from Vancouver.

The unexpected and sudden government 15% tax for purchases by off-shore buyers, in metro-Vancouver, at the beginning of August, created a “pause” in all the secondary home coastal marketplaces…those sellers in Vancouver’s “hot market” had been the buyers in all the “by choice” regions. On Salt Spring, we “lost” August/September/early October. Then, around mid-October, things began to become busy once again.

The bulk of sales remain to a Vancouver buyer. Slowly, we are seeing renewed interest from Ontario. We may start to see sales from U.S. buyers…our low Canadian $ against the U.S. currency makes a real estate purchase here an interesting investment.

So many unknowables in the world: currency instability? Inflation/deflation? Equities or hard asset investment? Shifts in government? The impact of the post-Internet world just rolling on….

Change is the mantra of our immediate time.

Part of that: Boomers and Millennials. Different strokes for different folks. Important to understand the remarkably different ideas between these two significant demographics.

Stay tuned as well for the continuing changes to the real estate industry. Post-Internet dynamics change established models.

Salt Spring Island and the Gulf Islands are “by choice”/discretionary regions. The buyer has to first choose the specific Island…and then decide for the actual property on that particular Island. Time is a component of sales in all such secondary home/recreational areas…regardless of market trend in play.

Although it’s recent that sales volume increased (mid-March after 8 years of “flat”), prices have not yet increased. Stabilized, yes…and some properties have been selling for list price. Inventory is “thin”.

The 2017 real estate market kicks in here by mid-February. That’s just around the corner. At this time of year, some transactions will complete in January…perhaps for tax reasons. The process will have begun in this calendar year, though.

So…as we close 2016: strongest sales rhythm since 2006…very low inventory…price stability & sales at list price…all auguring for further improvement in the secondary home markets in 2017. The temperate climate and that slightly “apart” security of the Gulf Islands is also of appeal.

July 2012, Salt Spring Island Real Estate Market Analysis

The short intensity of our “season” is upon us…July/August/Sept/October are the physicality moments on Island, for actual viewings.

Inquiries come in year-round, but physical presence to view happens in this short window. Often, when an offer comes in during other months, it turns out that the viewing of the property occurred during these four key months.

These months are also considered to be the best, weather-wise, in our region…definitely a correlation, then, re this timing issue.

Tourism has been the start of sales action in our Gulf Islands environment. People arrive by private boat, by ferry/car, by floatplane…they stay, meander the charms of Ganges Village & discover the environmental beauties of the Island itself…then they decide on a second home/recreational retreat or, if possible, retire & move here, to discover a new lifestyle.

No one “has to” buy on Salt Spring or on another Gulf Island…..it’s all by choice.

This discretionary quality can often mean time lags in decisions. Important for a seller to be “out there”, though, so that a buyer searching on the internet can discover their property option…even though months may go by before they turn up to view & more months may pass before a sales transaction takes place. There is no motivator to action…it’s all at the discretion of the buyer.

Sellers need to be patient & realtors need to be consistent in their marketing message. The Internet has totally changed real estate as an industry, and this is especially evident in the secondary home marketplace. The consumer is now in control, and in a secondary home/resort-based area, the consumer controls the where and the when of all sales.

That said, both the tourism discovery and the weather pattern that attracts, in this coastal region, are underway.

For the first time in almost four years, buyers are back in our area. Appraisers feel that prices dropped around 35% between mid-2007 and mid-2012. Sales volume this year, however, has gone up over last by around 40%.

The sales activity between January 1 & end of June has mainly been in the entry level residential category. Starting in mid-April, the buyer was having to come closer to a seller in offer price point…before that, a seller had to drop further, never mind the reductions en route, to meet the buyer. The difference? Thinning inventory in the entry level residential segment creates price stability.

Prices in the upper tier priced residential options are not stable. The very few sales between one million and 1.5 still show large reductions at the point of the offer.

Undeveloped land sales and commercial property sales remain “flat”.

At this beginning moment, first of July, we may see a build-up of activity in the upper tier priced properties. Between 2007 and present day, most have seen price reductions in the millions…as they slowly capture a buyer’s attention, price points drop substantially further at point of the offer. In this still sticky segment, the buyer reluctance remains a factor.

So…price stability & thinning inventory in entry level residential, lack of consistent interest in upper tier residential, with accompanying severe price reductions when a sale does take place, and no interest yet in undeveloped land or in commercial opportunities. Hmmm…sounds like a market in flux, to me.

Markets are cyclical, and we may be in year 7 of a 7 to 10 year cycle…this implies a natural uptick in activity. Thinning inventory foretells price increases. Undeveloped land sales/new construction will follow, as good residential options sell off. The upper tier options will also improve in sales as a safe haven seeking continues to grow.

So important, in a shift moment, to be looking down the highway and not in the rear view mirror. A positive change is underway in real estate investing.

We are just entering our “season”…and the larger market cycle is slowly upticking. As a seller, this is good news for the first time in four years. For a buyer, it’s an alert to act now…that proverbial buyers market does not last forever, and by this time next year may have vanished entirely.

Perhaps this is the sales volume season?

More information? Call me! How may I help you to buy or to sell your special Island property? Look forward to bringing my knowledge (of both inventory and of trends) to your benefit.