Tag Archives: market analysis

June 2020, Salt Spring Island Market Analysis

Is it time to cast off now? To get going?

Between March 12th and May 19th, Salt Spring Island and the Gulf Islands were shut down, along with all B.C. communities, as the province responded to the government’s “stay home/social distance” edicts. Everywhere, only essential services were allowed to be open and social distancing/sanitizing were always required.

Ganges Harbour, Salt Spring Island, BC

The flattening of the curve of the Covid-19 virus has completely changed the terrain of our secondary home regions.

On Salt Spring, events/gatherings involving large groups were cancelled (Home & Garden Show, Round Salt Spring Sailing Race, ArtCraft, ArtSpring, indoor pool, Saturday Market, Canada Day, Fall Fair, Sip & Savour, and so on). Schools were closed. Accommodations closed. Parks were closed.

B.C. Ferries cancelled some routes and cut sailings on others on April 4th. Flights were on hold for floatplanes, until May 4th. Potential visitors to recreational communities, including Salt Spring, were asked to stay away, and, if owned a second home, not to go to their cottages.

Slowly, some soft re-openings occurred in early May…the government had targeted May 19th as the beginning of mainstream business re-openings. Continued social distancing and sanitizing protocols were required by all businesses. Numbers of customers in a space at any one time were also being strictly controlled.

All aspects of communication were forced to be online, during the eight week closures. By mid-May, federal, provincial, and local governance groups were discussing what the “new normal” might be like and recovery/resiliency measures were being planned…all via Zoom.

The Before: pre-March 12. The Middle: still going on. The After? Not yet clear.

Does seasonal tourism affect real estate on the Gulf Islands?

In seasonal tourism based economies (such as on Salt Spring Island and the Gulf Islands), to lose the traditional business opportunity of March Break to Canadian Thanksgiving Weekend (mid-October) is devastating. Some businesses have been able to pivot to online sales models, but not all are set up to do this. Some may not reopen. The Canadian government projects that 30% of businesses will disappear. How will this affect Ganges Village?

What was the outcome for real estate sales? Most buyers for Salt Spring properties still continue to come from Vancouver/Lower Mainland. Sellers there become buyers in the secondary home/rural areas.

The Vancouver market began to improve around September/October 2019, after two years of slump due to interruptive provincial government taxation measures to suppress busy city markets. Salt Spring experienced a follow-on increase in sales by November, 2019.

Between November and early March, 2020, the island was experiencing low inventory, buyer desire, stable prices, and seemed poised to have sellers market conditions in place. The March Break season opener beckoned. Then: Covid-19 virus arrived and complete shut-downs throughout B.C., by March 12th.

There has been no sudden inventory increase, since the pandemic closures. Prices have remained stable. Inquiries (online) during the shut-down were serious and substantial. May 19th was seen as the slow beginning of potential physical viewings, as government relaxed its “stay at home” measures.

Hastings House Hotel, Ganges Harbour, Salt Spring Island, BC

Some predictions / projections

The latter part of May did see people arriving to view, often on a day trip, and some offers were being made. With few listings, buyers were quick to act on anything that caught their eye…most options receiving offers were still listed below a million, but a few higher priced properties, even some that had been listed for several years, were suddenly seeing action.

The real estate board updates about less sales in April/May simply reflected the enforced pauses in activity. These board reports also noted few listings for a buyer to consider, and so stability in pricings remained.

Some are forecasting serious house price reductions across Canada, as a result of the pandemic closures…it is true that people who have lost jobs and cannot meet their expenses will put their hopes for housing on hold. Current events are so without precedent, though, that one can argue many scenario outcomes.

Another scenario is that people able to work from home may be seeking suburban and rural opportunities. Time will decide the outcomes. It may be that buyers from out of country, disturbed by global unrest, will ignore the current 20% offshore purchase tax in Vancouver and buy now. Vancouver sellers become the buyers in secondary home areas.

Projections right now are calling for all secondary home markets to see an increase in viewings (required distancing protocols in place) with potential resulting sales between mid-June and end of September. City dwellers may truly be seeking a move to authentic rural areas, with opportunities to garden/to be self-sufficient, to be less crowded. Hmmm…..the country mouse lifestyle might now be attractive to the city mouse.

Salt Spring Market Conditions during COVID-19?

At this very beginning of June, then, there are 74 residential properties for sale on Salt Spring.

Townhomes, waterfronts, acreages are not separated out.

  • 38 of these are listed between 339,000 and 999,800.
  • There are 24 properties listed between 1,079,000 and 1,795,000.
  • There are 10 listings between 2,000,000 and 2,999,900.
  • There is one residential listing at 3,179,000 and an 84 acre farm at 6,688,900.

At the very beginning of June, there are 70 undeveloped land properties for sale, not separating out lots, acreages, waterfronts.

At the beginning of June, there have been 59 “solds to date”.

  • Of these, 45 sold between 156,000 and 980,000
  • 13 sales took place between 1,057,325 and 1,900,000.
  • One sale took place at 2,395,000.

In almost every case, a reduction took place at the point of the offer/sale

Most sales took place before mid-March, but a handful did occur in April/May. In most cases, those buyers had been looking at Salt Spring and the Gulf Islands earlier, and so were not “new business”…they had just decided to act.

Interest Rates Low

Interest rates have remained exceptionally low. Although there are not a lot of listings (as soon as you put in price and type, you see this), there are good ones and a buyer is a valued part of a transaction…no matter the trend in place, a decision to purchase on Salt Spring is always a choice, and sellers do listen to serious offers. If an owner wants to be a seller, this is also a good time…low inventory means less competition.

Where to market Salt Spring Listings?

Marketing opportunities will quickly change/amplify, as the totally online world supplants previous options. Although important, the MLS is now only one vehicle of online property presentation. Print real estate supplements may not survive.

It’s interesting about the internet influence…it can make a property look very different from its reality…it can leave potential negatives out of the frame…it can generate a viewing and then lose the consumer’s interest by not delivering on the online promise. It’s important to encourage a viewing, yet it’s also necessary to reflect reality in an online marketing presence. Consumers will want to see physically what they observed online. This may be especially true in rural areas.

As we get to the After, everything will be different. Is that a threat or a promise?

June is the half-way point in a year.. The months of January/February/first of March 2020 clearly belong to a different time. The pause period (mid-March to the end of May) erased earlier expectations. Now, June to late September, if the flattening of the Covid-19 virus continues successfully in B.C., may turn out to be the main sales window for Salt Spring Island and the Gulf Islands.

Buyer’s or Seller’s Market?

It will depend on the consumer’s desire to act. Will they travel? Will they want to look at properties? Will the seller allow viewings on a first visit, or will they insist on exterior viewings only the first time? There is no one way to forecast the pattern of a reopening in a pandemic time.

There is both desire and hesitation on the part of a buyer. How will that play out? And what about all those government pay-outs to maintain a population? Will the government re-work the currency to offset the debt? Might this current flurry of interest in real estate in some areas reflect people’s concern about the ongoing value of cash?

Beauty on the Gulf Islands

Meanwhile, June: blossoms are evolving into apples, pears, plums, nuts, berries, grapes, olives…produce from gardens and orchards and farms are on display at farm gate stands and at farmers markets. The longest day of the year is at hand. The sea invites exploration by sail, power, kayak, paddle board. Parks are open again. Beauty is everywhere on the Pacific Northwest Coast and the Southern Gulf Islands/Salt Spring Island invite one to enjoy this explosion of Nature’s best.

August 2019, Salt Spring Island Market Analysis

Salt Spring Island

For many years now, Salt Spring Island and the Southern Gulf Islands have seen strong sales between August and year end.

The Gulf Islands became predominantly summer/fall markets several years ago.

Some sellers don’t list their properties until August, as they want unencumbered enjoyment of their properties, for one last summer season.

The Evolution of the Salt Spring Island “Buyer”

Some buyers, who might have viewed a Gulf Islands property in the Spring season, might now be willing to act with an offer…there might be a little psychology at play, along the lines of: “seller may be noting that we are nearing the close of a seasonal marketplace, and so may be willing to accept a lower offer”. This could be so…although an outcome might also depend on motivation of a seller to sell.

At the beginning of August, then, we find a very thin inventory of listings continuing, and yet actual sales still take time to fill in.

Buyers who come to view Salt Spring or another Gulf Island or even a Vancouver Island community, seem to be interviewing areas. The main buyer profile remains someone from Vancouver/Lower Mainland. They plan to live where they choose to buy.

It does make sense then that these buyers will take time to check out the merits of various locale possibilities…why here? Why not there? Often, that “being sure” means two or even three trips to a region, “checking it out”, before deciding to make an offer on a specific property.

Patience is important on the part of a seller. It just seems to take the time it takes to accomplish a sale in any secondary home/discretionary area.

The first decision is always: “I choose for Salt Spring”. Then a potential buyer will be serious about purchasing a property. Before that decision about choosing “for” the Island, as the destination, viewings occur without resulting offers.

Sales & Inventory Analysis

At the beginning of August, there are 135 residential listings (not separating out townhomes, single family homes, waterfronts). Of these, 69 are below one million; the majority are below 900,000. Over half the residential listings are priced over one million. Of these, 49 are listed between 1,020,000 and 1,999,900. Eleven are listed between 2,150,000 and 2,900,000. Four are listed between 3,200,000 and 3,895,000.

At the beginning of August, there are 135 residential listings (not separating out townhomes, single family homes, waterfronts). Of these,

  • 69 are below one million;
  • the majority are below 900,000.
  • Over half the residential listings are priced over one million.
  • Of these, 49 are listed between 1,020,000 and 1,999,900.
  • Eleven are listed between 2,150,000 and 2,900,000.
  • Four are listed between 3,200,000 and 3,895,000.

At the start of August, there are 97 lots/acreages for sale (again, not separating out waterfronts), ranging from 148,800 to 2,495,000.

At the start of August, there are

  • 97 lots/acreages for sale (again, not separating out waterfronts), ranging from 148,800 to 2,495,000.

By the beginning of August, there had been

  • 89 “solds to date”, ranging between 135,000 and 1,700,000.
  • Fifty-seven of these were below 800,000, supporting a pattern that entry level residential offerings were the most active segment in the
  • first half of the year.

In the latter part of the year (August to year end), one often sees interest in upper tier priced properties filling in. It should be clear by mid-October what the upper tier property market sales trend will prove to be in 2019.

Salt Spring Lifestyle

BC Ferries

Salt Spring Island enjoys a year-round lifestyle opportunity. Three ferries service Salt Spring, with consistent year-round service (to Vancouver, to Victoria, to mid-Vancouver Island). There are three elementary schools, a middle school, and a state of the art senior school. There is a hospital on Salt Spring and excellent care. There are regular year round floatplane companies servicing Salt Spring (to Vancouver airport and to downtown Vancouver). All services/amenities required for a pleasing 21st Century lifestyle are available on Salt Spring. It is not necessary to leave the Island, although it is easy to come and go.

Part of the Islands Trust, a body created by the provincial government in 1974, Salt Spring is also a part of the Trust’s mandate: to preserve and protect the environmental beauties of the Gulf Islands for the benefit of all B.C. residents. Salt Spring is not a municipality. Effectively, the Trust capped growth on all the Gulf Islands, via strict zoning/density bylaws. Two trustees are elected each civic election and also a CRD (Capital Regional District) director. Many of the wonderful things Salt Spring enjoys have been put in place by volunteers. Ask me about this!

Salt Spring and the Southern Gulf Islands are in a microclimate known as “cool Mediterranean”. More hours of sunshine/less rainfall than in other coastal communities. Orchards, vineyards, wineries, craft brewery, cideries, olive groves, cheesemaker’s, farmgate stands…the rural agrarian life is here. Taste your way around the Island!

An authentic artists community, Salt Spring also enjoys a rich cultural life. Ganges galleries, Studio Tour, ArtCraft, ArtSpring. SSNAP (Salt Spring National Art Prize), 2019. More info? Call me!

August offers B.C. Day Holiday Weekend fun, Saturday Market in the Park (one of the 10 best markets in Canada), the Tuesday Farmers Market, live music venues (Treehouse, Moby’s, Legion, Woodley’s), Wednesday evening sailing races, kayaking to Chocolate Beach, sunset viewing at Vesuvius Beach, dining al fresco around the town, whale watching tours, swimming in ocean & lakes, forest breathing, and…your fave summer choices are? Share!

Salt Spring is a delectable place to visit and a very special place to call home. How may I help you with your Salt Spring Island real estate needs? Call me! Your best interests are my motivation. I look forward to your call.

June 2019, Salt Spring Island Market Analysis

June. It’s a lovely hiatus month, between two real estate market moments: it straddles early Spring and Summer market patterns.

June also welcomes graduations, weddings, school’s out/summer holidays enthusiasm, and, on the great Pacific Northwest Coast, it can often be a showery weather month.

Gardens are in full array, roses are at their abundant bloom best, farmers markets, vineyard tastings…the opulence of Salt Spring’s rural heritage surrounds us.

Upper Tier & Entry Level Activity

At this hiatus moment, between two real estate sales patterns, it’s evident that entry level priced properties were where the action was in our short (due to weather vagaries between December 20 and end of March) early Spring cycle.

The upper tier priced properties don’t usually begin to see activity until after the Victoria Day Holiday Weekend, in mid-May.

Between mid-May and end of October, our real “season” takes place…and it invites buyers, in all price ranges and seeking all property types, to come forward to view.

Listing Inventory

The listing inventory remains very thin. We are seeing price reductions, but are also seeing that the very few new listings coming onstream are at higher price points than would have been the case in the previous year. Everything on the table at once means we are in a transition market…with an apparent upward momentum. Few listings, coupled with buyer desire, can lead to price increases. This outcome may not be evident until mid to late August.

I do this market update at the beginning of a month. June can have a “pause” in the first two weeks. Perhaps it’s about those family celebrations, but it might also be that late June begins summer travels and so early June is calmer.

At the beginning of June, then, we have 124 residential listings on the market. This does not separate out townhomes or waterfronts…it’s just residential/dwellings listings. There are 79 lots/acreages on the market. There have been 60 “solds to date”.

This is an extremely low listing inventory, particularly in the entry level priced categories. Most sales remain in that entry level price segment.

Of the 124 residential listings, at beginning of June

  • 12 under 500,000
  • 10 were under 700,000
  • 19 were under 800,000
  • 18 were listed below 900,000
  • 7 listings were under 1,000,000
  • 40 listings between 1 & 2,000,000
  • 12 listings between 2 & 3,000,000
  • 5 listings are between 3 & 4,000,000

Of the 79 lots/acreages, without separating out waterfronts, at beginning of June

  • 27 were listed under 300,000
  • 20 listed below 500,000
  • 16 were listed below 600,000
  • 10 were below 1,000,000
  • 6 were listed between 1,020,000 and 2,495,000

Of the 60 “solds to date”

  • 28 were below 600,000
  • 12 sales below 800,000
  • 10 sales were below 1,000,000
  • 10 sales between 1,000,000 and 1,700,000

Patience in the Secondary Home Markets. Invaluable

Patience is a part of all sales in all secondary home markets. A decision to buy is a choice…no one “has to” move to Salt Spring. In deciding about that choice, there are always time lags. Buyers do look in competing areas, “just to be sure”. It can take three visits before a decision is made.

Obstacles Can Play a Role

There are always issues facing all communities: for Salt Spring, the lack of affordable housing/work rental is also a problem. There are three public (and one private) affordable housing/rental options that are funded and permitted and they cannot go ahead because of the water moratorium.

Brought in by the three volunteer board members of NSSWD (North Salt Spring Water District) in 2014/15, this effectively prohibited connections to the water systems. There may be a capture/distribution issue on Salt Spring, but there is not a water shortage issue.

Water is under Improvement Districts at the provincial government level. The government has off-loaded Improvement Districts onto municipalities. Salt Spring is not a municipality…it is part of the Islands Trust. The CRD (Capital Regional District) out of Victoria could assume the NSSWD, but has not done so.

The lack of work rental options led to the Trust bylaw enforcement officer shutting down airb&b/short term vacation rental options (STVR). This was done under the assumption that vacation rental landlords would then rent to regular annual tenants. This is the Trust response to lack of work rentals.

The lack of people wanting to rent to regular tenants has to do with the current provincial government’s change to the B.C. Tenancy Act. The government canceled the Fixed Tenancy option, in Fall, 2017. This is why people do not want to be landlords to regular tenants…unless the owner moves in, one cannot give notice to a tenant.

Underlying Issue

The underlying issue, lack of affordable housing/work rental, gets back to the volunteer driven NSSWD moratorium on connecting to water systems. In our non-municipal form of governance, there is a lack of proactive oversight.

Summer Begins!!!

Meantime, the summer-summer season begins with June…and visitors to Salt Spring generate the economic well being of business enterprises. Check with the Salt Spring Chamber of Commerce for more information.

So, lovely June is upon us. Time to dine al fresco on restaurant decks and patios, to enjoy live music venues (Treehouse Cafe, Moby’s, Woodley’s), to meander Ruckle Park trails, to go jump in the lake (St Mary’s, Cusheon, Weston, Stowell) and swim to your heart’s content, to paddle board off Vesuvius, to kayak to Chocolate Beach, to enjoy Saturday and Tuesday Markets, to simply “be”, and to definitely stop and smell those roses.

Seeking a real estate outcome on delectable Salt Spring Island? No matter the market trend in play at any given time, there is usually a way to make things work. Call me! Let’s discuss. Your best interests are my motivation.

March 2019, Salt Spring Island Market Analysis

Salt Spring Island
Salt Spring Island

March 2019, Salt Spring Island Market

The entire Pacific Northwest Coast region experienced a once-every-twenty-years winter season weather pattern, which erased the 2019 projected early market.

A hurricane force wind on December 20th, with resulting power outages and severe forest damage, was replaced by an Arctic Front and snowstorm sequences (no melt between storms, due to cold)…the result of all of this was to cause a cancellation of potential viewers/buyers. Christmas/New Year week and February’s Family Day Holiday Weekend were both affected by weather-induced pauses. The good news: everyone did rebook and March appears to have “busyness” at its heart.

Listings remain very low, in both residential and in undeveloped land options. With renewed buyer interest, coupled with this lack of owner desire to sell, we may see price escalation begin. It may take until late April/early May to see the true tone of this year, since weather issues have created a slow start to the market.

Vancouver Real Estate Market 2019

The Vancouver market is also beginning to reactivate, including in the higher end property segment. Vancouver sellers have been the main buyers on Vancouver Island and on the Gulf Islands, since mid-March, 2016. Hesitations from then to now can be attributed to various provincial government tax measures, specifically created to suppress the Vancouver market, plus El Nino/La Nina weather vagaries.

March to Spring

March sees the beginning of Spring, showcases the allure factors of Salt Spring, and invites market activity…to enjoy a property between late Spring and early Fall (the best weather months in our area), one pretty well has to buy in March/April.

Low Canadian Dollar against the U.S. dollar, low interest rates, lack of inventory that may drive future price increases (would see this, if turns out to be the case, by summer), and a renewed global seeking of a safe haven destination, are all reasons for increased action. The hesitations of 2018 (mostly a reaction to the many provincial government tax burdens in Vancouver) seem to be over.

How can you make this current market work for you?

How can you make this current market work for you? Whether a seller or a buyer, and no matter the market trend, there are always elements that can work to your benefit.

At the very beginning of March:

  • 87 residential listings (not separating out waterfronts, townhomes, farms)
  • 60 undeveloped land listings (lots/acreages)
  • 14 commercial/business listings

10 sales to date, all residential, from 440,000 to 1,700,000.

It is more usual to see a total of 380 to 420 listings on Salt Spring…this lack of current inventory (147 residentially zoned options, including dwellings and undeveloped land), if continues, could lead to price escalation by the summer season.

March is an interesting month. It eases from winter into spring, daylight saving returns, and everywhere the resurgence of growth ignites our natural coastal beauty.

The Best Time to Visit Salt Spring Island

An annual Home and Garden show sponsored by the Salt Spring Chamber of Commerce takes place in mid-March and the beginning of the Saturday Market in the Park “season” is in place by month’s end. Live music continues at Moby’s, at Woodley’s, at the Legion. ArtSpring showcases special events. And the days are enticingly longer…time to rediscover Salt Spring’s hiking/walking trails, beachcombing pleasures, gallery spring openings…time to consider a garden.

April through October

Although Salt Spring is seasonless, in the sense that there is always something to discover and to enjoy, it is true that April to October are the famously most delightful months on the great Pacific Northwest Coast. March is the shaking off of winter and the preparation for “real Spring”. Time for all of us to mirror the month and to shake it up a little.

Thinking of real estate this March? Call me. Benefit from my knowledge of inventory and market trends. Your best interests are my motivation.

Market Analysis, January 2019, Salt Spring Island

View of Mount Baker from Salt Spring Island

January is an interesting month. It’s mid-winter, a quieter time, with many people taking holidays in sunny places…and there is a sense of pause after December’s busy holiday celebrations.

The beginning of a year is also a time to dream our plans into action.

In real estate, potential buyers are active on the Internet, searching out information on areas that might be of interest to them. Potential sellers are wondering about market indicators…mulling over timing…seeing if it’s a good time to list.

There are always sellers and buyers

Real estate on the Gulf Islands is not time sensitive. Although tourism is busiest in late Spring to late Summer, real estate activity takes place throughout the year…the Gulf Islands / Salt Spring Island are really “seasonless”.

January is a good time to catch up on the societal changes underway. Read information on block chain technology. Get behind the sound bites/prepared headlines. Think about what it really means in Life After Google. Attend investment conferences. Listen a lot…no one really has definitive answers. Your ideas are equally worthy.

These profound societal shifts will also change real estate, as an industry. No aspect of our culture will be untouched. Important to remember: in change lies opportunity.

One thing we know, locally, as we start into January: the listing inventory remains very thin on Salt Spring and the Gulf Islands. Owners are still preferring not to be sellers.

The Islands Trust

The Islands Trust maintains those 1974 “controlled growth” zoning/bylaws. This means there will always be low inventory, in spite of market movements over time.

Buyers right now are hoping to connect with a Gulf Island property. Market signals like lack of inventory coupled with buyer desire do result in price increases, over time.

In spite of immediate repercussions from the provincial government’s 2018 measures to suppress real estate markets in Vancouver (and also in Victoria, Nanaimo, Kelowna), it is not possible to artificially control a market long-term. Markets have their own rhythms. The spring/summer 2018 pause in action, as a result of government interventions, may be erasing.

Vancouver is now a world-class city, and may never be affordable. The buyer market is global. When owners sell in Vancouver, they will buy in nearby areas…Salt Spring, with its year-round lifestyle and services/amenities at hand, is often top of mind for that buyer from elsewhere. Supply of product becomes of interest.

There is no “local buyer” on the Gulf Islands

There is no “local buyer” on the Gulf Islands…whether a recreational buyer or someone seeking a year-round lifestyle, the Gulf Islands destinations attract…and it’s rare that people move around once they locate here.

I often think that real estate sales in the Gulf Islands fall into thirds. November, December, January, February are perhaps similar enough to be noted as a market “one third”. The first two months of a New Year do seem to mirror the patterns of the last two months of the previous year.

It’s common to have some sales reported in the early days of January…the business would have been done in the latter part of 2018, but completing in early 2019 (perhaps for tax reasons).

It really takes until March Break to see the emergence of a market trend, in our kind of secondary home/discretionary marketplace.

Steady activity and consistent sales best describe the closing months of 2018. Most sales were residential offerings, below 800,000. This pattern may continue into the first two months of 2019. There does seem to have been a slow beginning in interest in the upper tier priced residential market segment, in 2018…this trend may continue more strongly in 2019. An interest in undeveloped land parcels/and a construction project may also be a feature of 2019…based on lack of residential supply.

No one has a crystal ball. In our global village world, no area is immune from events in distant places. The allure of “pocket places” remains, however (and Salt Spring and the Gulf Islands, protected by the Islands Trust 1974 mandate, and close to major centres, are such pocket places).

2019 may see continuing low inventory and also a beginning of higher prices (that old law of supply and demand).

January gets its name from Janus, the ancient Roman deity with two faces…one looking back and one looking ahead. Pay attention to the past…but definitely be looking ahead. That’s where discovery lives.

Discover Yourself Here!

That’s the Salt Spring Chamber of Commerce invitation: “Discover Yourself Here!”, and it’s a promise to those who respond.

Are you seeking a Salt Spring Island or Gulf Island property? Benefit from my knowledge and expertise. How may I help you to buy your special place? Call me!

Market Analysis, December 2018, Salt Spring Island

December 2018, Salt Spring

Here we are, starting into the last month of this haphazard 2018 market year.

The weeks between January 1 and February 20 did promise continuing brisk real estate sales…inventory was diminishing in residential offerings and prices had solidified…undeveloped lots/acreages were catching interest…higher end properties were being shown…and a seller’s market was in play.

Provincial Government Policies

The coalition provincial government brought in a budget (February 20) that specifically targeted Vancouver, Victoria, Nanaimo, and Kelowna…seeking to suppress the buoyant real estate markets in these areas. Several measures were introduced…the speculation (vacancy) tax being a key one.

Between February 20 and March 27, the Southern Gulf Islands/Salt Spring Island were included in the vacancy tax. The government used regional district boundaries to delineate where this tax would be applied. The government agreed that the Islands Trust (formed in 1974) had created a recreational ownership-resort based region and so all Gulf Islands were finally excluded.

Since the slow recovery on Salt Spring (began in mid-March 2016), inventory in place, due to the economic meltdowns of late 2008, had slowly cleared out. Fall 2017 & up to late February 2018 saw consistent sales and in all price ranges. Then the February 20 budget…..

Were the policies effective?

The point of the taxation measures applied to Vancouver was to suppress the real estate market…the theory being that prices would drop and affordability would rise. It might have been a better idea to open up opportunities for construction of affordable rental and purchase units. Sales did shut down in Vancouver, but affordability may not have been addressed.

Salt Spring, like other secondary home markets, is dependent on buyers from elsewhere. The recovery on Salt Spring, after the almost nine-year economic meltdown, was driven by Vancouver people who had sold in Vancouver…and were looking to relocate. The suppression in the Vancouver marketplace, after February 20, caused a corresponding pause in action on Salt Spring, for most of 2018.

Inventory still remains low. During spring/summer there were viewings. Fall saw more sales…not just showings. Sales were mainly below 800,000, and residential, not lots/acreages.

Visiting Salt Spring Island is the Key

Some projections are calling for a bounce back in the Vancouver marketplace by early spring, 2019. This is an unknown. What is known is that Salt Spring and the Gulf Islands are dependent on a buyer from elsewhere.

Before the economic downturn, the main buyers were from Alberta and the U.S. The 2016 beginnings of a recovery on the Islands came out of Vancouver. There may be an upcoming reappearance of Ontario buyers, looking for retirement destinations.

To Preserve & Protect

Although Salt Spring and the Southern Gulf Islands are beneficiaries of the Islands Trust’s mandate of “to preserve and protect”, which controlled growth through strict zoning/density bylaws, the Islands are not unaffected by changes and stresses globally. The Islands are affected also by the current provincial government’s various measures to suppress real estate markets elsewhere in B.C. Pauses in market cycles, no matter the cause, are always a feature…it’s never a straight line up or down.

Lack of inventory, however, seems to imply a buoyancy beneath these many government restrictive measures. Those measures, designed to suppress a real estate market, may be being digested. In the end, consumers set the pace. The guru projection advisors may be right about a resurgence in the Vancouver market, by early 2019. Hmmm….

So…at beginning of December, there were approximately 296 sales on Salt Spring, which can be broken down as follows:

Some Sales Data

  • 11 sales between 138,000 & 195,000
  • 14 sales between 207,000 & 290,000
  • 11 sales between 320,000 & 398,000
  • 22 sales between 405,000 & 492,500
  • 28 sales between 500,000 & 595,000
  • 24 sales between 600,000 & 686,000
  • 25 sales between 705,000 & 795,000
  • 18 sales between 800,000 & 898,000
  • 13 sales between 900,000 & 999,000
  • 25 sales between 1,005,000 & 1,950,000
  • 4 sales between 2,025,000 & 2,850,000

The above numbers relate to the sale figures…they do not show the tracking down of pricings, on the way to that sale figure. For example, a property selling at 730,000 was listed at 774,000. One listed at 2.8 sold for 2.383. Price reductions at the point of an offer can be quite common on listings over 800,000.

Over half the current listings (approximately 106 residential listings, between 309,900 & 4.8, and approximately 57 lots/acreages between 159,000 & 2.495) are priced over a million, if in the residential category. (In a “normal market”, listings might run between 380,000 & 425,000, in total). Listings are not plentiful right now…particularly if below 800,000.

If the water moratorium (put in place by 3 volunteers on the North Salt Spring Water District board) could be resolved, then 255 units (approved and funded), re affordable housing/work rental, could be built.

Those business enterprises that cannot find housing for proposed staff are also recognizing that vacation rentals are required. The visitors staying at airb&b are the buyers of their local products. Both types of rentals are needed in a secondary home/discretionary area, reliant on a tourist based economy.

Last Fall, the current provincial government canceled the fixed tenancy option on a lease, under B.C.’s Tenancy Act. In areas such as Salt Spring, this might be a reason for the reluctance to engage in a regular rental process.

The provincial government is in charge of Improvement Districts (water is under this jurisdiction). The government has transferred Improvement Districts to municipalities. Salt Spring is not a municipality. The CRD (Capital Regional District) would have to assume the Salt Spring water districts…or the unfortunate moratorium will not be resolved. There is no water shortage on Salt Spring. The issue is one of capture & distribution. The 255 ready to build affordable housing/work rental units await the outcome.

The changes to the Real Estate Services Act of B.C., enacted on June 15, 2018, are in place. Questions? Call me.

Celebrate!!!

December is a traditional time of celebrations. On Salt Spring there are many craft fairs (Beaver Point and Fulford Hall craft fairs, WinterCraft at Mahon Hall, pop-up events), plus ArtSpring presents seasonal music and theatre to enjoy. Volunteers create the Shop Local events clustered under the Christmas on Salt Spring label. Santa arrives twice: once by floatplane and later via a Carol Ship. The Village sparkles with Light Up. Lots to see and to enjoy.

Be re-inspired by your personal traditions…take time to remember others…take advantage of the fallow field moment of calm. That’s where the creativity lives.