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Salt Spring Island, February 2024, Market Analysis

February in the Pacific Northwest Coast Real Estate Market

February often starts the early Spring market on the Pacific Northwest Coast. The trend for 2024 might not be evident till March Break, but February introduces the early activity.

Salt Spring Real Estate Market – Early February

What do we see in the Salt Spring real estate market at this very beginning of February? The song of thin inventory continues. This is a theme seen in competing Vancouver Island communities…lack of listings is not just a Gulf Island issue.

Why Owners Hesitate to Sell

There are many reasons for owners not wanting to be sellers. That flight from urban to rural, post-pandemic, continues. It may be about a desire for safety. Geopolitical concerns are part of location decisions. A desire to be apart from city problems is a strong driver to action…a seeking of a “kinder gentler” lifestyle makes sense. There is also that “back to the land” component, where one can be self-sufficient if supply chains falter. These elements may propel buyers, but they also stop owners from becoming sellers…they are already enjoying these elements. IF they thought of selling, they would discover they can’t find a replacement property elsewhere…no inventory…and so it goes.

Gulf Islands Governance and Real Estate

Under the Gulf Islands form of governance (Islands Trust, with a mandate to “preserve and protect” the environmental beauties of the Gulf Islands for the benefit of all B.C. residents), in place since 1974, a buyer purchase/investment is ensured to remain as purchased. In this era of extreme change, this continuation of what one fell in love with, and purchased, is a strong feature of decisions to invest on a Gulf Island.

Ganges

Market Dynamics and Future Trends

It’s also a recipe for price escalation. Will we see multiple owners as a buyer profile, going forward, so that one can enjoy ownership of a Gulf Island property? Hmmm….there are always work-arounds and creative ownership models may be one outcome to encourage the opportunity to own, as prices rise and inventory remains static.

A February 2024 Market Analysis On Salt Spring

So: the very beginning of February shows continuing low inventory, with buyer interest showing up in all price ranges and property types, and now with a sense that one needs to act. The pauses in action, seen in 2022 and 2023, appear to be over. Oddly, this increase in activity began in November 2023. The interest rate fluctuations remain a factor in buyer outcomes. Those having to renew mortgages in 2024 and 2025 will also be making decisions as to whether to hold or to sell. Lack of inventory to buy or to rent may decide people to struggle on with current ownership.

Real Estate as Capital Preservation

Many on both sides of the seller/buyer divide are seeing real estate as a way to preserve capital. Concern about erosion of purchasing power of currencies has people thinking about how to retain value in their holdings.

Anticipating Future Outcomes

Lots of outcomes still waiting to be formed…it’s very early in what promises to be a busy year. It’s a good idea to attend seminars and financial webinars…all information is helpful in times of change. And also keep an eye on AI…implants that allow one’s thoughts to effect change? Hmmm…. Mid-Feb welcomes the Year of the Wood Dragon in the Asian Lunar New Year. The western zodiac sees Pluto in Aquarius, a line-up not seen since the French Revolution. Recipes for change? Keep your editing function fired up.

Exploring the Local Area in February

So: February. Check the garden…early bulbs and shrubs are flowering forward. Give yourself the gift of new…zip off to Victoria or Sidney and look at a different set of walls. Remember the Cowichan Valley…on our doorstep and lots to see and do there. Beaches to explore at Parksville/Qualicum or all the way to Tofino. Check out our close neighbours, the other Southern Gulf Islands…each with their own signature. A day trip makes us glad to get back to Salt Spring’s many charms. Family Day holiday weekend in mid-February invites us to sample other nearby spaces. Lucky us…adventure on!

Salt Spring Island, January 2024, Market Analysis

January ponderings…

The Roman god Janus gave his name to this beginning month of the New Year.
With two faces, one looking behind and one facing forward, Janus reminds us that every beginning carries with it some of what went before…and also introduces the new.

If you are interested in the Asian horoscopes, then it’s good to know that February 10th ushers in the Year of the Wood Dragon.

Change is The Wallpaper of Our Time

It’s taken 23 years for the real 21st century to finally arrive.
Early forays into websites and emails morphed into social media communications. It really is now possible to pretty much do one’s life and business off a smart phone. 5G speeds it all up.

Zoom during the pandemic closures got us all used to image only meetings. What will happen to all those empty office buildings? If there is a housing shortage (and there is), then why are they not being turned into interesting housing developments?

And what about AI? Clunky ChatGPT is only the rudimentary beginning. So: reality. Virtual, augmented, real…and so forth and so on. It’s called artificial intelligence…the second word implies thought.

If someone gave us a ticket to 1996, would we take it? It seems like a time that is already in the far far past.

Meantime, since change is simply the wallpaper of our time, and we must flow forward on this river of shift, it’s essential to recapture our editing function. Data is not information. What is visible on the internet may not be authentic. Only our editing ability will help us sort it out.

Is Real Estate Strengthening?

Yes. The almost two year “pause” (soft sales, low inventory, nervous buyers) of 2022/2023 is over. Prices are higher. Most owners do not want to be sellers. Buyers want to act. The difficulty about low inventory: not enough choice for a buyer. If they don’t find what they are looking for, they won’t act. Yes, there are fewer sales, but that’s because there’s less to sell. What will happen when many mortgages will be up for renewal in 2024? Often, secondary home/recreational marketplaces can be somewhat insulated from this renewal scenario.

At this very beginning of January:

There are approximately 77 residential listings on Salt Spring, not separating out single family, townhomes, farms, waterfronts.

There are 31 land listings, not separating out waterfronts, acreages, lots.

That’s a total of 108 listings…a balanced market might see 280 listings.

At the end of 2023, there had been approximately 179 sales, ranging between $55,000 for a mobile in a park and $4,288,000 for a waterfront on five acres. Projections continue to call for consistent positive real estate outcomes, based on strong immigration and lack of housing options.

The various government measures to increase rental stock and buyer options (vacancy tax, prohibition on out of country buyers, increased purchase tax for non-residents) have not proved to create more housing opportunities. Artificial government edicts do not take the place of encouraging private enterprise to build/to develop. The lack of housing will continue for some time.

Geopolitical concerns continue. Worries about inflation, and currencies also continue. Remember Voltaire and his warning that paper money always reverts to its true value: zero. Is another reason for buyers seeking out special properties in unique areas simply a desire to preserve capital? Is this also why owners are not wanting to be sellers?

Many changes in the real estate industry itself. Stay tuned as the ways to buy and to sell real estate undergo significant changes…just as all segments of society must grapple with serious change. Nothing is exempt.

January of 2024

Lots to think about as we emerge into early January of this New Year. It is a New Year and we can choose whether to look backwards or to opt for Janus’ forward staring face.

Meantime, January…a month to savour that every day is eight seconds longer. We are on the slow march to Spring. Now there’s a thought!

Salt Spring Island, November 2023, Market Analysis

November, 2023.

Feathered with Golden Leaves

November signals mid-Fall…forested hills feathered with golden leaves from Maples and Alders…more rainy days, and bursts of sun between storm tracks. Daylight Saving Time ends, and this adds to darker late afternoons. Some call it the cosy season and that image of a slower pace welcomes this softer season to Salt Spring and the Gulf Islands.

The 2023 pattern of the real estate market remains in place: very low inventory, in all property types and price ranges, and general stability in sale prices. Lack of choice for buyers remains an issue.

The Gulf Islands & The Islands Trust

Governments at all levels (federal, provincial, municipal) are struggling with the lack of housing inventory. The Gulf Islands, unincorporated areas (except for Bowen), are under the Islands Trust form of governance (a provincial government body put in place in 1974, with a mandate of “to preserve and protect” the Gulf Islands for the benefit of all B.C. residents). Strict zoning/bylaws prohibit growth. Two elected trustees per Island do not have the power to change the Trust mandate…the provincial government would have to do that.

Inventory & Immigration

Lack of housing of all types is an issue in all communities and the Gulf Islands are not immune. Lack of supply keeps pricing higher. Most owners do not want to be sellers, as world events continue to cause major insecurities…a search for personal safety and for capital protection are two threads behind current buyer searches…that flight from urban to rural continues. Social unrest is evident. Strong immigration to Canada, coupled with lack of housing product, continues.

A Fall Market?

So…November. A holding pattern in local real estate, with low inventory and continuing buyer interest. For several years, the main buyer profile has been from Vancouver/Lower Mainland. Outcomes in Vancouver do trickle down to the Gulf Islands. A Fall Market has also been a characteristic of Gulf Islands sales, for many years.

November offers: ArtSpring theatre events, craft fair at WinterCraft, farmgate
stands, receptions at galleries, folk club headliners, live music venues, easy access to hiking/walking trails, still lots to do and to enjoy.

The softer season…yes. Enjoy.

Salt Spring Island, September 2023, Market Analysis

Earlier Sunsets on Salt Spring

A lovely month in the Gulf Islands and on Salt Spring Island…September retains Summer moments and slowly segues into true Fall. Shorter days, earlier sunsets, star-watching pleasures, and the delectable harvest time.

On Salt Spring? Catch the amazing Fall Fair (September 9/10)…the old island meets the current one and each day is totally different. Don’t miss this annual event. The Ganges Galleries are showcasing the output of their signature artists, ArtSpring events are offered, and ArtCraft will gently close for the season. Wine and cider tastings, Saturday and Tuesday Farmers Markets continue, and farmgate stands are showcasing their produce. Lucky SaltSpringers! Labour Day Holiday Weekend starts the month.

Fall Market Salt Spring Real Estate

And what about that Fall Market in real estate? Several years ago, Summer and Fall became a busy time in the Gulf Islands. It can be busier than the Spring market, and some call this time of year “the second Spring”.

Although the 2023 year began late (mid-April?), it was consistent. Inventory remained low. Entry-level price points and residential listings found most of the action in the Spring/early Summer timeline. Towards mid-August, some upper tier priced properties also found their buyers. It is usual to see higher end opportunities finding their buyers in September/October/November, year after year.

Low inventory is likely to continue. Unless they have to, most owners are not interested in being sellers. IF they were interested in selling, they can’t find listings in the areas they might consider moving to. No one wants to be houseless.

Lack of Construction + Invitation for Immigration

The Canadian government’s invitation for immigration (500,000 + a year) bumps into the past forty years of lack of construction. Strong desire to buy, coupled with lack of housing options, result in price escalation. A lack of affordable housing (whether to purchase or rent) remains a Canada-wide issue.

Why Invest on Salt Spring Island

Salt Spring and the Gulf Islands governance model is under the provincial government body known as the Islands Trust (created in 1974). The purpose was to preserve and protect the environmental beauties of the Gulf Islands for the benefit of all B.C. residents. In a sense, these islands are like park reserves. Growth is capped via strong zoning/bylaws restrictions. The Islands Trust restrictions also keep inventory low, regardless of market trends.

Concern over currency uncertainties may be another factor in low inventory…choosing hard assets is one way to preserve capital in uncertain times. Owning property on Salt Spring and the Gulf Islands can be viewed as an important decision in one’s investment portfolio.

Seeking a successful real estate outcome on Salt Spring and the Gulf Islands? It’s very important to me that things work to optimum for you, whether selling or buying. Questions? Call me. Your best outcomes truly are my motivation. Information is key.

Fall is the season of mellow fruitfulness…

Meantime…it’s early September and the season offers beauty everywhere. September 1st is meteorological Fall…in spite of the calendar saying it’s summer till the 20th. As the poet John Keats described, Fall is the season of mellow fruitfulness.

Time to hike the trails at Ruckle Park, the Mt Erskine trail system, the Channel Ridge trails. Time to dine out at our amazing restaurants and taste the delights of the harvest season. Time to meander the galleries and discover the meaning of talent. Time to star watch and ponder a bigger picture. Time to choose fresh veggies and fruits at farm markets and test drive your culinary skills. Time to welcome the cosy season.

Fall’s softer season is there to enjoy. Accept the invitation.

Salt Spring Island, February 2023, Market Analysis

February…and the slow slide into Spring begins.

It’s a short month, with a romantic allure on Valentine’s Day (Feb 14th), and a weekend holiday on B.C. Family Day (Feb 20th) Weekend.

Yes, a mix of winter and early spring, with that freshening sense of new beginnings (always the welcome message of real Spring).

Early Real Estate Patterns Emerging

What about the real estate patterns that are also beginning to emerge? It often takes until mid-March to get the tone of a market in a secondary home marketplace, such as the Gulf Islands. The buyer profile on the Gulf Islands is not local…buyers arrive from elsewhere…and for the last several years (perhaps fully since 2015?), the main buyer has been from Vancouver/Lower Mainland.

After the first pandemic closures in early 2020, real estate activity began…the flight from urban to rural was the main driver to action. The ability of the internet to authentically allow the option to work from home, no matter that location, also was in place by 2020…allowing that rural shift to successfully take place.

In 2021, the inventory thinned out dramatically in all rural areas and in some cases there were bidding wars (more buyers than sellers). The low inventory continued throughout 2022, but buyers were pausing…inquiries came in, viewings would take place, but activity from buyers had slowed. Uncertainty was the culprit.

In the latter part of 2022, worries about the impact of distant wars, supply chain issues, concerns about lingering pandemic and health outcomes, fears about rising interest rates, currency concerns, reports of a global recession…all of these uncertainties had buyers simply treading water…are we safe? That seemed to be the major question. A pause is not necessarily a correction.

Lack of supply is what keeps prices stable and potentially tracking higher. The federal government is seeking immigration of 500,000 each year for the next two years. At the same time, they are putting a two year ban on foreign ownership. (There are many exemptions and one of them is that the ban will not apply to recreational areas (such as the Gulf Islands). Check the federal government website for further details).

Less Supply, More Demand…

CMHC (Canadian Mortgage and Housing) forecast last year that unless 22 million housing units were built by 2030, there would be no alleviation of the lack of supply in Canada. So: few housing units and increased immigration…sounds like a recipe for price increases, in foreseeable future. Hmmm…..

It is interesting, when looking back to previous serious recessionary times, that real estate usually softens a year before other indicators point to such outcomes. If so, that would put 2022 as the softened year in real estate. From early March to early December, 2022, the hesitation in buyer activity did see some dramatic price reductions, to try to jumpstart sales action. In most cases, these reductions did not result in either more viewings or in sales. When a buyer is treading water, it means a period of inaction. Real estate also often recovers sooner than other lagging sectors.

Unusual Active January

In early 2023 (January, often a quiet month), it became active again (working around bursts of winter weather, of course). Sales of some properties that had been listed over a year, and with reductions that had been ignored, suddenly took place. As we enter the very beginning of February, inventory remains extraordinarily low.

Owners do not want to be sellers, it appears, unless they have to. To own a property in a unique area, where the Islands Trust form of governance effectively capped growth (in 1974), may be seen as a stalwart investment…a hedge against inflation and currency pressures. Buyer choice remains limited. By April, media reporting may be highlighting this renewed buyer activity and the lack of listings. More information? Contact me (liread33@gmail.com).

A Time of New Possibilities

We are all prisoners of our time…this current time period is full of unknowns and uncertainties and this does create hesitations. It may also be a time of new possibilities. Ever more important to sharpen up our editing skills. We are all swimming in a sea of raw data…making sense of it is a task indeed.

February is a good month to read, listen to webinars and podcasts, attend investment seminars, to glean bits of wisdom to guide us, to take the information in and then to see what makes sense individually. Also important to keep up to date on AI discoveries…things like ChatGPT could be serious game changers for our era. We are now all, in a way, our own experts. Important to trust our own inner editor.

Meantime, it’s inspiring February. Early flowering shrubs, snow drops and crocus bulbs are up, early daffodils in protected areas are smiling hello. Remember to get out and about in the natural world. In our digital universe it is ever more important to really “see” our companion natural environment. Walking meditation is a lovely entry to such appreciation.

February…an invitation to softer days, lighter days, and all that an early Spring promises. Enjoy!

February…and the slow slide into Spring begins.

It’s a short month, with a romantic allure on Valentine’s Day (Feb 14th), and a weekend holiday on B.C. Family Day (Feb 20th) Weekend.

Salt Spring Island, December 2022, Market Analysis

The first of December is considered meteorological Winter, although the calendar says it begins on the 20th. The great Pacific Northwest Coast experiences shorter days (dark by 4:30 p.m.) and every year is slightly different, weather-wise. This year promises snow and arctic cold. I prefer the usual rain that has our west coast location often described as “the famously wet coast”. (I am allergic to snow at sea level).

Salt Spring Island

Things To Do on Salt Spring Island This Winter

Lots of art gallery openings and receptions in December, plus the annual WinterCraft at Mahon Hall until the 23rd, the annual Beaver Point and Fulford Hall craft fairs (December 2 to 4), and other loved pop-ups…closed for two seasons due to covid closures, these displays of artistic flair are welcomed. ArtSpring offers choral/seasonal concerts…check out the website for dates. Enjoy the lights in the Village, and the decorated shops. Tasty special menus at coffee stops and restaurants…decorated farm gate stands encourage a jaunt around the island. Live music venues (Moby’s, the Legion) are fun. Check out the Christmas on Salt Spring events (the Chamber of Commerce website or Visitors Centre). Does Santa really arrive by floatplane?

Close to major centres and yet wonderfully apart…a visit to a Gulf Island/to Salt Spring Island can be a restorative and peaceful experience at this softer Winter season.

Real estate at this end of the year

Real estate at this end of the year time is still consistently chugging along. Buyers remain interested and active. Snow storms mean some delays for some viewings, but Winter does not last long in our region. Inquiries remain strong. Winter is often a weekend business in a secondary home market. The lack of inventory remains a factor. The desire for a buyer to leave the city and to live in the country is still the main reason for activity. That authentic internet connectivity allows this profound lifestyle change. A softer gentler lifestyle seems to be the goal. A very human need: to be safe.

Housing Supply & Purchase Taxation

The governments (provincial and federal) are attempting to solve the lack of affordable housing supply through taxation (offshore purchase taxation, empty home (speculation) tax, moratorium on non-Canadian buyers, interest rate rises), and yet the federal government is also looking for 1.5 million immigrants by 2025. CMHC has forecast that 22 million housing units would need to be in place by 2030, to solve this “lack of housing” crisis (not including immigration pressures).

First time buyers are affected by the series of interest rate rises. Some experts are forecasting more rate rises to come…others think not (possibly fearing societal unrest?).

Affordability is tied to supply…instead of taxing existing options, which does not grow supply, governments need to encourage construction…an entrepreneurial answer to supply and demand issues.

Real Estate – Still A solid hard asset investment

Meantime, real estate remains a solid hard asset investment (especially during currency fluctuations) and keeps pace with inflation.

December is a time to be thoughtful, a time to acknowledge traditions and to practice the art of gratitude. A time to create new traditions and to include those on their own in our celebrations. It’s fun to research other seasonal events and definitely important to have lots of candles, have a fire in the hearth, and to invite light into our homes. Maybe a year to reread Charles Dickens’ classic: A Christmas Carol?

Feasting is allowed. A pause is encouraged.

December…a time of joy. Good to partake.