[podcast]https://lireadgroup.com/blog/wp-content/podcasts/Li-Read-Drew-Clark.mp3[/podcast]
Salt Spring Island Real Estate | April 2011
Salt Spring Island Real Estate | April 2011
I often think that the real estate year falls into distinct “thirds”, in our secondary home/discretionary marketplace.
The first third is that January to April timeframe, and so here we are, moving into the last weeks of the first third segment.
Traditionally, sales in January/February are usually outcomes of business from the previous year. Perhaps the buyer chose to make the offer/complete the transaction in a new tax year, but were really thinking about a purchase in the previous year. A sale in the first six weeks, then, of a new year, is not often “new business”.
Salt Spring Island Real Estate | Seashore Beauty
I often think that a clear picture of the market in any given year isn’t possible until April. March Break activity will have taken place by then, and a forerunner of potential Summer business will have shown itself.
Quite often, the emergence of March Break’s early tendrils do flower into a real Summer season. No action in March Break usually means no activity in the “second third”. That is what happened in 2008, 2009, and 2010…a “flat” market.
A slow “uptick” in all residential , not just in entry level price options, began to show itself by mid-October, 2010. Undeveloped land and commercial options remained quiet.
Throughout 2006 and 2007, “flat” conditions prevailed. 2008 saw the plunge into “market meltdown” territory and a full “stop” to action. Only entry level residential options saw activity from March 2009 to September 2010, and there were very wide price gaps between list and sale pricings.
Price reductions, without resulting in either more showings or in sales, were the pattern throughout 2009 and 2010.
Buyers did not want to act, and in a secondary home marketplace, where a purchase is by choice/not a necessity, nothing happens unless a buyer comes forward.
Such discretionary markets are totally in the control of the buyer, not the seller or the realtor.
Post-meltdown, fear stopped action. Sales were few and far between.
Appraisers report that prices reduced between early 2007 and late 2010 by 20 to 30 percent, depending on the type of property involved.
Now the fear of currency instability, post-bailouts, and a seeking of a “safe haven”, in the aftermath of all the resulting societal unrest, may be behind the current return to hard asset investments. Fear can also “propel”.
Or, the renewed interest in discretionary residential real estate may be the simple outcome of the seven year cycle theory.
Seven years up and seven years down…neither scenario in a straight line, of course. It’s one market “philosophy”.
So, are we in year six of a seven year downturn? If so, that’s like 1998-9, and look what happened by 2001-2…a sellers market of huge proportions!
The sales frenzy currently underway in four Vancouver neighbourhoods (West Van, West Side, Richmond, White Rock), driven by Asian buyers (Mainland China), may result in those sellers arriving in the Gulf Islands, on Vancouver Island, on the Sunshine Coast, into the Okanagan “grid”…the very discretionary areas which have been so “flat” in the past four years.
Nothing ever stays up or down forever…and the shift in either direction happens quickly when the “turn” is almost there.
Economic issues continue, “natural” disasters shock, civil wars unexpectedly erupt, societal unrest everywhere…the “global village” is full of unrest and seems without a road map in hand. No one is immune to the societal shifts in this post-internet world.
Locally, businesses reliant on tourism/discretionary buyers (restaurants, galleries, artist studio tours, kayak, scooter, car rentals, B and B, resorts, floatplanes, ferries, hotel, motel, grocery stores, contractors, architects…did I leave anyone out?) also experienced the “pause period” of the past four flat/non-active years. Real estate is a foreteller industry, in a community’s life.
With improving sales patterns, we’re seeing new building, completion of earlier projects, a “freshening” of business/tourism ideas (Blossom Festival in early April is just one example).
What we do know for sure: low interest rates, reduced prices, good inventory…it is a time to be a buyer, and it appears that thoughtful investors are acting.
If undeveloped land starts to sell strongly, which, I think, may occur by late Fall/early 2012, we would then be starting into sellers market conditions again. That’s definitely a positive market indicator, movement in raw land!
So…we are nearing the important “middle third” (May to September), in our secondary home area, which is when the majority of sales take place, IF they are going to occur.
The rhythm of connection seems to be present, for the first time in four years, and buyers are apparently slowly deciding to “act”, and in all residential price ranges.
It is a new and heartening pattern that has shown itself, in these important first months of 2011…good news, indeed!
How may I help you to buy your special Salt Spring Island or Southern Gulf Islands property? I look forward to your call!
Gulf Islands National Park Reserve
The Gulf Islands National Park Reserve was created to preserve the Gulf Islands natural beauty, and to protect several ecological sensitive areas.
The park consists of Cabbage Island, Tumbo Island, Portland Island, Brackman Island, The Sidney Island Spit, D’Arcy Island, Russell Island, parts of Pender Island, and almost half of Saturna Island. The park also includes several small islets off the Georgia Strait side of Mayne Island and Samuel Island.
The facilities available depend on location and may include: mooring buoys, dockage, dinghy dock, stern ties, outhouses, walking / hiking trails. Some portions of the park are ecological reserves and are not open to the public.
Visitor Guide & Hiking/Camping Brochure
Contact Information
- Address: 2220 Harbour Road, Sidney, BC, V8L 2P6
- Tel: 1-250-654-4000
- Toll-Free: 1-866-944-1744
Park Wardens
Civil Politics on the Gulf Islands | BC
Leave a reply
Civic politics…on the Gulf Islands this means the Islands Trust.
Every three years, throughout B.C., one elects mayors and councillors, if the area is a municipality.
The Gulf Islands are not municipalities. In 1974, the provincial government created the Islands Trust…its mandate is “
Strict zoning/density bylaws were brought into being to control growth.
Two trustees were elected for each Island.
The “water access only islands” were tied to a ferry accessed island, when it came to specific bylaws, particularized for each island, over and above the umbrella items that apply overall to all Gulf Islands.
The Trust’s mandate is to oversee land use bylaw issues.
Things like building permits, septic installations, etc., were under the control of the CRD (Capital Regional District), if close to Victoria. Vancouver and Vancouver Island have their equivalent bodies. The CRD would oversee all unincorporated areas close to Victoria, including the Southern Gulf Islands.
Over time, the OCP (Official Community Plan) for each Island would have been amended to reflect a particular Island’s concerns.
On Salt Spring, after many years, an OCP review took place in the 1990s, and another one in mid-2000s.
In the 1990s, reflecting a time where the government was needing to offload some costs generally, the then NDP government came up with the idea of creating a Gulf Islands Municipality category.
Under this, the Trust would remain in place, with 2 elected Trustees, but the CRD position (also an elected office, at civic election time) would be replaced by an elected council, and the Island choosing this specialized form of municipal structure would be more autonomous with costs. This would, of course, save the government money.
The two islands approached about this type of municipal structure, due to their population and infrastructure growth, were Bowen, in Howe Sound, and Salt Spring. Both Islands turned down the proposal, in a referendum, chiefly out of fear that taxes would rise.
In a second referendum, at a later date, Bowen voted yes, and that Island does have this Gulf Islands Municipality structure in place.
On Salt Spring, a group called Islanders for Self-Government has recently been attempting to get the government to approve a second referendum, to allow Salt Springer’s to reconsider their earlier “no” to the proposal.
In the intervening years, taxes have risen sharply, under the Trust/CRD format, and further costs are set to escalate. The current Trustees have enjoyed a second term, and have put in place many bylaw amendments, re-interpretations perhaps, that are meeting with opposition from many Islanders.
This is an
If you’re a property owner on Salt Spring, it’s very important to keep up to date. Several changes or re-interpretations do appear to be underway, and many of same will affect you. Whether you’re a seasonal or a full-time resident, be informed!
Check out the Trust’s website, and read all of the proposed changes. Pay attention to requests to raise taxes to implement some ideas. Apathy is not an option!
Ask the ISG (Islanders for Self-Government) group to explain their ideas. Again, just “be informed”.
Ask the Chamber of Commerce to be accountable, too, in their mandate (which is to lobby the government on behalf of small business…to give local business a voice). A strong business community is the marker of a lively and enriching overall community. Salt Spring’s Chamber has ignored this duty in the past, by choice.
So many shifts and changes lately, and Salt Spring is not exempt. Important to listen to alternative opinion, and to speak one’s own calmly…courtesy is an aspect of strong community spirit, too.
This is an important year in the Island’s “life”…it needs all the Islanders to step forward and to “act” for the Island’s best interests.
Being informed is a start….
Artisans & Salt Spring Island
Interesting BBC International news item…the story was about a group of artists in New York, several years ago…dancers, painters, sculptors, writers…and how their creation of “their enclave” resulted in the eventual gentrification of this low priced and undeveloped area, with substantial price escalation of real estate there.
First the artists, with their creation of a vibrant alternative and artistic local style, and then the followers, their “audience”, appeared and suddenly the area was “discovered”…hmmm….
Bleecker Street | New York City
So, it’s really the Gulf Island art scene, so colourfully and happily entrenched on special Salt Spring, that has led to the upscaling of the Island?
Well…maybe not entirely, but the emphasis on an arts culture could be a part of the overall “upticking” of values.
The Islands Trust, created in 1974, to preserve and protect the environmental beauties of the Gulf Islands, for the benefit of all B.C. residents, controls growth on the Islands via severe zoning bylaws.
Between 2000 and 2005, a low Canadian Dollar against other currencies (U.S., Euro, Pound), coupled with the internet that erased time and geography, enticed many people to the beautiful Pacific Northwest Coast.
That global / international discovery also attracted people to the beauty and to the arts culture on Salt Spring Island.
The increase in property values had begun. Buyers drive markets, not sellers or realtors.
In those years, with a “finite” inventory (the Trust) and a visible flowering of the arts scene via several magazine write-ups, people did flood onto Salt Spring, looking for their part of paradise….
Yes, the economic crash of 2008, and the resulting flatness of tourism, did create hardships on the Island. The rise in the value of the Canadian Dollar has also had an effect. Things went up 60 percent and down by 30 percent? Still didn’t go back to pre-2000 levels, though!
Yes, it’s an interesting thought that perhaps the discovery of these Islands, and their subsequent “gentrification“/increase in value, can be attributed to those artists who first arrived in the 60s and 70s and early 80s. Hmmm…..
In one way, it shows the power of the artistic vision to “attract”…the content providers are the invisible engines of change?
They may not agree with the outcome, that one has to be able to afford to live in any enclave area, but perhaps the artists really did create our “today”, on Salt Spring?
March 2011 | Market Analysis | Salt Spring Island Real Estate
Shift, change, whatever we label it, it’s with us, in all aspects of life…including in real estate sales.
No part of life is untouched by the impact of the internet, and its resulting relationship forms of communication.
The internet has delivered a business model that places the consumer at the core; companies and agents are no longer “key” to a sales process. This difference has profound implications for all sales marketing.
It is always the case in a substantive change moment that the first few years of the shift are taken up with trying to push the accepted/existing model into the new one.
We are just humans, and it appears that we tippy-toe up to massive change, poking and prodding and taking baby sips, before we “jump in”.
The hybrid/transition time may have been that 1999 to 2009 period. Transition is erasing, and the truly new is now with us. An explosion of apps and technology vehicles means that the consumer has the power, now, and can be the expediter of outcomes.
For real estate as an industry, it is now sitting fully where the consumer revolution placed the car industry, the travel industry, and the stock market side of investment, some several years back. Real estate as an industry was late to the table of change. The key? It is now an information open model that is required.
The standard franchise company model will have to evolve or be replaced (it’s no longer about companies or agents) and the mls system and related information repositories will have to change to an “open wall” concept…information is not about special interest group control of same. Data cannot be fenced off.
The consumer drops in and out of the information sea, at the consumer’s timeline, and the consumer decides “when” and “where” to contact a realtor. It’s the opposite to the old “call to action” motif of previous sales models, where the purveyor of the service set the rules.
When the consumer is ready to act, they will…after searching the web for answers to their questions, and without ever contacting a realtor, early in the process.
According to some real estate associations, who are trying to track consumer purchasing results, the buyer begins a search approximately 14 months before acting, and waits to contact a realtor until 4 to 6 weeks before a purchase.
In those intervening months between start and finish, it is rare that they contact a realtor…they may be on the mls and other related information sites, and on company and personal websites, but they are not contacting anyone…it’s a passive seeking at this point.
With 90+ percent of all sales apparently beginning via a search on the web portals, and only 1 percent now coming off print media, the shift is clear. Some specialty magazines, with long shelf lives, may still deliver some business, but the classified/newsprint ad style is no longer productive in inviting a customer.
In city markets, apparently around 7 percent of business comes from a sign call off a property realty sign…this is less effective in a secondary home marketplace, with seasonal residency/resort rhythms, and a non-local buyer profile.
At the start of the transition, between 20th and 21st centuries, websites were the form for internet data sharing…it’s still essential to have a website, but perhaps they are more like basements or attics for information…if a searcher needs indepth information, then there’s the website to root about in.
It’s a time famine world now, in these post-internet days…no time/always time, and who has time to dig around in a website, when one hasn’t figured out the questions to even ask yet?
This could be the point of Twitter…a mini website for the time starved/”on-overload” denizens of this post-internet world.
Social media is the new buzzword, and the move to add the word “marketing” to the phrase showcases the blurring of the personal and corporate worlds, now underway in the post-internet world.
It is suddenly a holistic model of being that is being created by the technology and its spin-off “apps” world, and business enterprises are a part of this. In social media, it’s about “everything” and “all at once”, and relationship selling is no longer just an idle concept…it’s “the” concept.
In change, lies opportunity….
With the consumer at the core, it means that any one of us can facilitate change/deliver new pathways. The ground is level.
Hmmmm…an interesting time, for all of us.
At the same time that we have societal change, business solutions change, information dissemination change, we have a real estate market change.
It may be that we will look back and agree that September/October 2010 was the “bottom-bottom” in the real estate market.
Since mid-October, locally, on Salt Spring Island, and on other Gulf Islands, and in the rural communities of Vancouver Island, on the Sunshine Coast, and in the B.C. Interior communities, a consistent though slowly building rise in sales volume has been underway. This is good news, indeed.
Prices have reduced over the past 2 years and the buyer is often able to negotiate a further reduction at the point of an offer. If the seller is from out of country, then the currency rise for the Canadian Dollar can be attractive, and encourage them to take a lower than desired offer.
the property market “crash” may be over
This kind of “spread” may narrow, however, as this year progresses and it becomes clearer that the property market “crash” may be over. Inventory will clear and choice will lessen.
The current sales in discretionary/secondary home areas may be driven by a buyer desire to get out of heavy cash positions (worry about currency instability) and by a search for a “safe haven” (desire for self-sustainability), but it may also be a natural shift from a down to an up market.
If markets experience a 7 year cycle, which is one theory, and our downturn in our secondary home marketplace began at end of 2005/beginning of 2006, then we are now into year 6 of a seven year cycle…a time, then, for savvy investor buyers to be acting. This market trend is perhaps also a driver to this renewed sales activity.
Continuing low interest rates, a reduction in property price values from the highs of 2005 to now, by around 25 to 30 percent, depending on property type involved, and motivated sellers, plus inventory choice…it is an optimum time for a buyer to act.
Looking to buy on Salt Spring Island or on another Gulf Island? Call me!
Follow me on Twitter….Facebook…Linkedin….
With a daily blog since 2005, and a strong social media presence since 2008, I look forward to interpreting with you “your” voyage to the beautiful Gulf Islands, and to connecting you with your dream property. Welcome your call….
How may I help you to buy your Salt Spring Island or other Gulf Island property?
