July, August, September are always the key months for tourism outcomes and for real estate activity, in our Gulf Islands marketplace.
Beginning of Season
I do these market reports at the beginning of each month, and so we are just starting into this year’s busier season. Inventory remains thin, and there are qualified buyers seeking a Gulf Islands/Salt Spring Island property.
Where is Salt Spring Island?
The Southern Gulf Islands are positioned between Vancouver, Victoria, and Seattle. With excellent ferry service (three different ferry routes service Salt Spring), and two year-round floatplane services, and with schools, a hospital, and all services/amenities provided on Island, Salt Spring offers a pleasing lifestyle…and all while enjoying the natural world protected by the Islands Trust (a non-growth policy, to preserve the environment on the Gulf Islands). This Trust has been in place since 1974.
Are Market Conditions the same on Salt Spring Island?
No area is immune from global intricacies, and the Gulf Islands did experience, along with most secondary home regions, an almost nine year downturn, after the 2008 economic collapses. During that time, inventory built up and there were few buyers around. The secondary home areas began to recover in March 2016 and, in spite of government tax measures to suppress real estate action in city markets, a slow improving trend was underway in all rural/discretionary regions.
Where is the market currently?
On Salt Spring, we have now arrived at the classic definition of a seller’s market: low inventory coupled with increased buyer desire. Price increases can be an outcome, over time.
It’s interesting that one local company reduced prices on almost all their listings in late May/early June. Also, in mid-June, a waterfront listed with another company sold for well above list price (which implies a “bidding war”). Transition periods are often characterized by different outcomes, all on the table at once.
As we enter July, there are 122 residential listings.
- 38 of these are below 799,000
- 59 of these are over one million
There are 88 lots/acreages listings
There are 77 “solds to date” (Solds range from 135,000 to 1,700,000).
Most owners do not want to be sellers, right now. The inventory of available listings is very low…as soon as one differentiates between price and type, this is immediately clear.
What is the impact of technology on real estate?
Along with the narrow specifics of our local marketplace, 2019 is ushering in the true 21st Century to the real estate industry as a whole.
PropTech has already visited our sister industry, the financial investment world. E-trade, for example, connects users directly with the means to trade. There is no middleman.
Artificial intelligence, machine learning, data mining, data-driven investing, globalization of search, changes to privacy of information, PropTech, tokenization of real estate, block chain technology that eliminates lawyers and realtors and puts sellers and buyers into direct touch, crypto currencies that avoid bank charges…real estate’s organization and execution will soon be different and very quickly so.
This is an interesting aspect when one considers a rural/discretionary property segment. Each property in a secondary home marketplace often mirrors the lifestyle of the owner…it’s even difficult for an appraiser…there are no comparables…each property is uniquely itself.
If one cannot use real comparisons to rank sales data, then how can cloud robotics state that such data is valid? Hmmm…perhaps this might mean that the interpretive voice of a knowledgeable local real estate agent will still be needed?
Definitely different days, and initial choices will be made on analyses of data. Interpretation of raw data will be important, but perhaps not at the beginning of an investor-buyer’s initial search. Data first…then interpretation…then it becomes information? Hmmm…..
So…how to position a seller’s property to catch maximum interest? So…how to facilitate an investor-buyer’s successful outcome? It is not business as usual, in this globally structured cloud universe.
Real Estate is a “People Business”
Real estate at its heart is a “people business”. Choices of location and style are often emotion based. We love a home. We feel at ease on a property. We are inspired by a location. These are emotional responses. Raw data is about statistical reports on past events, in an attempt, perhaps, at verifying future decisions.
Both are needed.
Happy Canada Day (July 1st)
Meantime: here we are at the very beginning of July (Canada’s birthday on July 1st and the U.S. celebration on the 4th). Salt Spring welcomes its visitors and both locals and visitors alike enjoy the many special summer events.
Saturday Market (one of Canada’s best), Tuesday Farmers Market, concerts in the Park (Tuesdays), sailing races (Wednesdays), kayaking to Chocolate Island, ArtCraft, Ganges galleries openings, Treehouse live music every evening, dining on a deck or patio (Salt Spring Inn, Auntie Pesto’s, Moby’s, Treehouse, Rock Salt, Piccolo’s, Kitchen), ArtSpring events. Forest breathing at Ruckle Park, Burgoyne Park, Channel Ridge trails. Wine tastings, cider tastings, craft brewery offerings. Salt Spring is a foodie paradise!
So many things to enjoy…look forward to hearing about your summer experience faves.