Tag Archives: Pacific Northwest Coast

Market Analysis, September 2017, Salt Spring Island

September, 2017

Salt Spring Island

Salt Spring Island

September on the Pacific Northwest Coast is often one of the most beautiful months. A lingering summer mixes with shorter days and a back-to-school rhythm. (I wonder how many of us still think of this month as the start of a “new year”?).

In real estate, for a market overview, I always designate a year as the month I’m in and then look back to the same month of the previous year. So…September 2016 to September 2017 is the “year” right now.

After an eight year downturn, due to the global economic collapses in 2008, Salt Spring’s secondary home market finally saw an up-trend begin in mid-March, 2016.

Most of these sudden buyers were from Vancouver, and had sold their properties there to mainly off-shore buyers. Between mid-March and end of July, a sales volume rise occurred…and prices began to stabilize.

Then: at beginning of August, 2016, the then provincial government brought in a 15% tax for off-shore buyers, for metro-Vancouver. This immediately cooled Vancouver’s market and also stopped Salt Spring’s recovery…the Vancouver sellers had become the buyers in the secondary home coastal markets.

Traditionally, August, September, October are busy sales months on Salt Spring and the Gulf Islands. In 2016, there was a pause in activity, due to the outcome of that Vancouver property purchase tax. The Gulf Islands did not see that usual busier Fall.

Then: the once-every-twenty-years La Niña “real winter” arrived, and between December 3 and May 15, the unseasonably cool weather kept property seekers and tourists away. This cold weather pattern affected the entire Pacific Northwest Coast.

The Spring Market did not take place in 2017, due to the weather pattern. It seems that this year’s rhythm has been six weeks late (both in nature and in real estate action). The summer market did not start up until mid-July, and did not really hit its stride until early August.

Although most sales remain residential and below 700,000 (most really below 600,000), prices have firmed up and inventory has thinned out. Sellers are often achieving their list price and back-up offers are becoming a feature.

Some few new listings have come on at higher price points, perhaps testing the market. Both undeveloped land sales and higher end residential offerings are also now slowly finding their buyers.

It may be, then, that the early spring market in 2018 will see a continued and stronger recovery in the coastal secondary home marketplaces. Meantime: the usual steady sales pattern of late summer/fall, on Salt Spring, is currently underway.

This monthly market report is written at the beginning of a month…updates as the month proceeds are found in my weekly blogs. At the end of August, then, sales on Salt Spring were:

  • 1 at 95,000
  • 19 between 112,500 & 199,500
  • 20 between 200,000 & 299,000
  • 24 between 305,000 & 396,000
  • 36 between 400,000 & 489,000
  • 28 between 500,000 & 599,000
  • 13 between 605,000 & 690,000
  • 12 between 700,000 & 770,000
  • 10 between 800,000 & 899,000
  • 2 between 900,000 & 945,250
  • 21 between 1,000,000 & 1,900,000
  • 4 between 2,200,000 & 2,500,000

Most buyers remain from Vancouver. A few Ontario buyers are also beginning to reappear. Our traditional Alberta and U.S. buyers are still not in evidence.

September also brings with it the referendum for Salt Springers to decide if the Island will become a Gulf Islands municipality (the Trust remains, with two elected trustees, and others would be elected to act as a mayor and council) or whether to remain “as is” (planners appointed from Victoria). Several years ago, Bowen Island chose this specialized type of Gulf Islands municipal structure.

September further brings with it the first legislature sitting of the new coalition provincial government. Both these parties suggested, in the last election, that the offshore property purchase tax should be brought in throughout B.C.

Hmmmm…outcomes in September, thus.

September is the harvest month…farmers markets and farmgate stands offer the largesse of the season. Fall Fair is a part of Salt Spring’s September pleasures. A reconfigured Sip & Savour will be enjoyed.

Salt Spring and the Southern Gulf Islands have benefitted from a renewed visitor discovery. Travel writers, foodie publications, and adventure maps are showcasing this delectable part of the Coast.

With a temperate micro-climate, an interesting and interested population, with an authentic artists community, and an inspiring natural world (and in the heart of some of the best protected boating waters in the world), Salt Spring enjoys a year round lifestyle. Close to major centres, with easy access, and yet wonderfully apart, the Island welcomes you.

Market Analysis, May 2017, Salt Spring Island

Salt Spring Island

Salt Spring Island

May 2017

May to end of September might be the main grid of tourism and real estate activity on the Gulf Islands.

Real estate sales do take place throughout the year, and in a way the Gulf Islands and Salt Spring Island can be described as “seasonless”, but the predominant arrivals time for the mainly non-local buyer profile does fall between these late Spring – into – late Summer months.

Hastings House, Salt Spring Island, BC

Hastings House, Salt Spring Island, BC

Hastings House, Salt Spring Island, BC

Hastings House, Salt Spring Island, BC

The Islands are in the heart of some of the best protected boating waters in the world, and the boating season coincides with this early May to end of September timeline.

After an eight year downturn (end of 2008 to early Spring 2016), the secondary home/discretionary markets on the Pacific Northwest Coast began to see an improving trend, throughout 2016, in both tourism and in real estate sales. This upward trend has continued in the first months of 2017.

I think there is a direct link between a successful visitor experience and a decision to purchase a property, in all discretionary and recreational regions.

A buyer has to choose “for” a place first…and then will choose “for” a property in that place. This is why it can take longer in a secondary home location, regardless of market trend in play, for a sale to take place…the buyer has to be sure about the region choice…that’s step one, always.

It is, however, quickly turning into an authentic seller’s market on Salt Spring Island and the Southern Gulf Islands…and in Vancouver Island communities, too.

A seller’s market is characterized by few listings and strong buyer demand.

In the beginning, prices stabilize…buyers have to offer closer to or at sellers list prices…then back-up offers, multiple offers, offers over list become next steps, if a property is unique or listed below market. Price rises follow. The law of supply and demand governs all markets.

Hmmm…. Yes, there are fewer listings, and yes, prices have solidified…but there are always opportunities. Seeking a Gulf Island/Salt Spring Island property? Call me, for suggestions on how to make the current market work for you.

Our 2017 Spring has arrived a good 4 to 6 weeks later than usual…it seems more like early April, not early May. This past winter was one of the once-every-twenty-years La Niña events….lasted from Dec 3 to March 12 (even skating on Cusheon Lake!). The last part of March and most of April have remained unseasonably cool and also rainy. Apparently, precipitation records have been broken.

May is welcome!

Sales at close of April:

  • 7 sales between 160,000 and 199,500.
  • 6 sales between 200,000 and 299,000.
  • 11 sales between 305,000 and 396,000.
  • 16 sales between 400,000 and 487,000.
  • 11 sales between 506,250 and 599,000.
  • 7 sales between 625,000 and 690,000.
  • 4 sales between 710,000 and 769,000.
  • 5 sales between 800,000 and 899,000.
  • 2 sales between 900,000 and 945,250.
  • 5 sales between 1,075,000 and 1,750,000.
  • 3 sales between 2,200,000 and 2,500,000.

The trend is clearly towards less inventory in all property types and price points. The main sales are still below 750,000. Upper tier priced residential offerings are now also starting to see interest and subsequent sales. Undeveloped land sales are on the increase.

The buyer profile still is mainly from Vancouver, with smatterings from U.S., Ontario, U.K., Europe, China. Alberta is still not yet seen as a strong buyer profile, although that buyer had been involved in about 20% of sales in previous years.

Sales will start to be less, compared to 2016 statistics, simply because less inventory is available.

The referendum asking Salt Spring whether to incorporate or not will be held on September 9th. The Trust documents will remain in effect in a “yes” vote (these documents govern all of the Gulf Islands and this provincial government body, the Islands Trust, has been in place since 1974). The CRD (Capital Regional District) will still have a presence. Two trustees and one CRD director will still be in place. The difference: a mayor and council will be elected locally, to manage Salt Spring locally. At the moment, decisions are often made by off-island parties. More information? Be informed. It may be time to introduce 1974 to 2017…important to have all information and to be thoughtful about your response to the yes/no question on September 9th.

May welcomes in several events as part of the Canada 150 celebrations. These events began in mid-April and will continue through to early October…150 days of celebration events. July 1st is Canada Day. Time to be on Salt Spring! (P.S. the Flower Power event is encouraging gardeners to plant red and white flowers).

The great Pacific Northwest Coast is a superb locale at this time of year, and Salt Spring Island and the Gulf Islands are a part of this coastal allure. Enjoy!

Market Analysis, April 2017, Salt Spring Island

Salt Spring Island

Salt Spring Island

April 2017

We experienced the yin and yang of a La Niña weather pattern on the Pacific Northwest Coast…from early December to mid-March.

Salt Spring fell into “real winter” on December 3, 2016 and experienced yet another serious snowfall on March 5, 2017. In between: snow, cold, with ice build-up remaining on roads between the frequent snow storms, only main roads to ferries cleared (side roads and driveways on their own). There was skating on the lakes…that was a fun item. The last time the Coast experienced the La Niña effect was in 1996.

The entire Coast was affected, including Vancouver. The weather did affect real estate viewings…potential buyers couldn’t get out of where they were, never mind not being able to easily get around on Salt Spring!

December, January, February, and first half of March (higher elevation properties only saw the “melt” begin around March 12th) caused a slowdown in new action. Many of the reported sales of early 2017 had their beginnings in late Fall of 2016.

Although we often describe Salt Spring and the Gulf Islands main sales window as falling between March Break and the Canadian Thanksgiving Weekend, the reality is that the busiest months are May, July, August, September.

The Islands are secondary home/discretionary/recreational markets…I call them recipient markets. Sellers have to wait for a buyer to first visit, then decide if a particular island works for them, and then to really start their search for a specific property. Time is always an element of sales in all secondary home/recreational regions.

That said, it’s clear that 2016 was a sales volume increase year…a cleaning out of inventory that had built up during the eight year economic downturn. Prices stabilized, but did not increase.

In a “by choice” area, such as Salt Spring (and the Gulf Islands), there is always a time lag component in sales outcomes.

Salt Spring Island

Salt Spring Island

Often, a tourist with a successful visitor experience becomes a buyer in our region. Usually two, if not three, visits take place before a purchase decision. The non-local buyer wants to “be sure”, before committing to a purchase. When a property sells quickly, it often means that a property is listed exactly when a buyer has returned for that second or third decision-making visit.

With less inventory to choose from, however, we may now start to experience some bidding wars, IF a property is unique.

2017 has had a slow start, solely due to the unusual weather vagaries, but all signs are there for further inventory clean-out (especially in the upper tier priced residential properties and in the undeveloped land segment). After that? No crystal ball, but the signs are definitely in place for price increases in any new (and potentially few) new listings.

The tone of 2017 may be fully in place by late May. It may be that buyers who acted in the first three months of this year will turn out to have been the last buyers able to catch a seller’s interest with a lower than list price offer. In other coastal regions, which often catch the wave of change before it’s seen on Salt Spring and the Gulf Islands, the price escalation due to lack of inventory is in evidence.

Between 2000 and 2002, sales volume increased by around 50%. Between 2003 and 2005, prices rose by around 60%. Our dollar was low against the U.S. currency. International buyers were in evidence. Hmmmm…… Similar soundtrack?

Stay tuned.

To date, there have been 55 sales between January 1 and March 31. The first several (below 200,000) were undeveloped lots. The higher end residential did see price reductions at the point of an offer, but residential below 500,000 often sold at (or close to) list pricings.

  • 6 sales between $160,000 and $199,500.
  • 4 sales between $234,000 and $280,000.
  • 8 sales between $305,000 and $396,000.
  • 8 sales between $400,000 and $485,000.
  • 9 sales between $506,200 and $599,000.
  • 5 sales between $625,000 and $690,000.
  • 3 sales between $729,000 and $769,000.
  • 3 sales between $800,000 and $878,000.
  • 2 sales between $900,000 and $945,250.
  • 4 sales between $1,075,000 and $1,750,000.
  • 3 sales between $2,200,000 and $2,500,000.

I do this market analysis at the beginning of each month…updates may appear in my blog entries.

Along with the transition from a buyer’s market (few buyers and many listings) to a seller’s market (few listings and many buyers), there is the Islands Trust (government body in place since 1974, which capped growth on the Gulf Islands via strict zoning/land use bylaws)…the inventory will always be less on a Gulf Island, thus, beyond market trends).

Salt Spring will be asked on September 9th whether or not to retain the status quo (2 elected trustees and one elected CRD director…the actual decisions, however, are currently made from a central Trust office in Victoria…and these government appointees do not reside on Salt Spring), or whether to incorporate as a Gulf Islands municipality (two trustees elected, per usual, plus councillors & a mayor…the Trust documents remain in place, but decisions re governance would be made on Island & not in Victoria). Keep in the loop of the conversation on both sides of this important issue.

Meantime…the beauty of the Island calls to us. Check out the Food Network’s one hour showcase of Salt Spring…the travelling chefs came last summer and I think they caught the essence of this magical island.

Looking for your special property on Salt Spring Island or on a Gulf Island? Call me. There is always opportunity for a buyer, regardless of market trend in play.

Market Analysis, March 2017, Salt Spring Island

March 2017

So…the season begins….traditionally, March Break to Canadian Thanksgiving Weekend (mid-March to mid-October) offers the traditional grid of real estate sales action in the coastal secondary home (recreational) markets…which includes Salt Spring.

Salt Spring is basically a seasonless market, though, and people visit year round…real estate sales can occur at any time.

If one is seriously for sale, then one needs to “be exposed to the market”. The digital world, which is now where most buyers first encounter a listing, does not recognize weather or time of year. If wanting to sell, it’s important to be found on a buyer search, at any time.

For a buyer, statistics show that they look for property almost 2 years before buying, via Internet sites. Yes, they are “interested”, but not yet “ready”.

About 6 weeks before they are in that “ready” state, they connect with a realtor and make appointments to view what has caught their attention. Once they physically arrive and view, they will see other options, too. Thus, the buyer may or may not purchase the property that first caught their attention.

Hmmm…in secondary home markets, where most buyers are from elsewhere, it often takes two (and sometimes three) visits before a purchase. Since these buyers are often from afar, there can be substantial timelines between visits…sometimes 3 to 4 months, or longer.

Time lags are a part of real estate sales in secondary home/discretionary markets. Days on market are not significant in recreational/by choice regions. Sellers know how long they’ve been listed, but to a buyer who has just started a search, everything is “new”. If a newly listed property sells quickly, it often means that a buyer has turned up for that second or third visit, right at the time the listing came onstream.

So many changes to the real estate industry, all of them driven by technological shifts, but some things remain the same…especially in the recreational/discretionary regions.

Customer service, knowledge of the area (both inventory and market trends), negotiating skills, an authentic interest in a consumer’s concerns, knowledge of zoning/bylaw issues (very important on a Gulf Island, which is governed by the Islands Trust), a good short-list of qualified professionals to aid the consumer (property inspectors, legal advisors, septic installers, water test labs, architects, contractors, mortgage advisors, etc)…a local realtor understands the area and can interpret the many local issues.

An Internet search is helpful, but some items in a recreational region are best discussed with a knowledgable & experienced local realtor. That interpreter function is an essential addition to any internet based information.

Market trends: like any market, real estate also experiences that wave-like model…up and down and somewhere in between. Markets are never static.

The global downturn of late 2008 lasted for almost 8 years in our local region…some areas saw recovery much earlier. For Salt Spring and the Southern Gulf Islands, the recovery began in mid-March, 2016. There were earlier whispers of action in late 2015, but a marked upsurge in residential sales volume began in early Spring, 2016. By year’s end, inventory had thinned out and prices had stabilized.

A seller’s market is characterized as low inventory coupled with high buyer demand. This scenario can lead to price escalation.

This early in the season, it’s too soon to speculate on price points. All that can be said is that there might only be two or three property options currently on the market that will suit a buyer. Thus, the seller may benefit by achieving list price or close to it. If this lack of inventory trend continues, then price escalation may be a factor by the Fall Market.

There is always opportunity for a buyer, regardless of market trend in play. Creative ways to buy that special property, in a recreational area, can always be found…even in a seller’s market.

Market Analysis, February 2017, Salt Spring Island

February 2017

The real estate market shows its tone by mid-February, in our secondary home marketplace. It seems that the first six to seven weeks of a New Year continue the tenor of November and December of the previous year.

February 2017

A resurgence in sales, resulting in a very thin inventory and a stabilizing of prices….these are continuing signs of a market uptick. An increase in tax assessments that reflect the strong sales in the previous year…such assessments are mailed out to property owners in early January…is another marker. Multiple bids and higher selling price over list price: that has happened, if a property is unique, and is another sign of an authentic turn into seller’s market conditions.

It is wise to allow January and early February to unfold. The secondary home markets see their busiest moments between mid-March and end of October. Best, perhaps, to let the first weeks of a new year bring forward the clues to the rest of the year. By mid-February, the first whispers of the main trend start to be heard.

So, meantime, attend conferences that offer arrows of information about the future. Pay attention. Be aware of shifts and changes.

It’s the fallow field moment: the roots are busy, but very little shows above ground.

Salt Spring and the Gulf Islands remain extraordinary places to visit, to enjoy, to choose as special places to live. They are “seasonless” experiences. There is always something to discover and to be inspired by.

More information? Call me! Your best interests are my motivation…I will make sure that you see all property opportunities available in your preferred categories.

Pop by my office for free maps, weekly driveby lists for all listed properties, regardless of realtor or company or board affiliation. All current listings, totally up-to-date, to help you in your search. Welcome!

Market Analysis, January 2017, Salt Spring Island

January 2017

The real estate market shows its tone by mid-February, in our secondary home marketplace. It seems that the first six weeks of a New
Year continue the tenor of November and December of the previous year.

A resurgence in sales, a thin inventory, a stabilizing of prices….these are continuing signs of a market uptick. An increase in tax assessments that reflect strong sales in the previous year…such assessments are mailed out to property owners in early January…is another marker.

It is wise to allow January and early February to unfold. The secondary home markets see their busiest moments between mid-March and end of October. Best, perhaps, to let the first weeks bring forward the clues to the rest of the year.

So, attend conferences that offer arrows of information about the future. Pay attention. Be aware of shifts and changes.

It’s the fallow field moment: the roots are busy, but nothing yet shows above ground.

Salt Spring and the Gulf Islands remain extraordinary places to visit, to enjoy, to choose as special places to live. They are “seasonless” experiences.