Tag Archives: CRD

February 2014, Market Analysis

February, 2014. Salt Spring Island Real Estate

We live in such an interesting time! Change is its mantra.

Some early February “thoughts”:

Salt Spring Island

Salt Spring Island

Although the eraser of the Internet began to disturb existing business models around 1996, it initially seemed “business as usual”, with some small modifications, might prevail.

In those beginning moments of not really well understood change, we were all trying to get former successful options to fit into new venues. Suddenly, for example, everyone had a website…as if that was “it”.

It’s normal, though, in the early days of a serious societal shift, that the old and the new intermingle…perhaps for 20 years or so? Then the hybrid moment is over…I think that’s where we are now.

The profound nature of the shift into consumer driven outcomes, combined with continuing & dramatic technological inventions, have totally reconfigured our lives.

5 Issues Facing Salt Spring Island & The Future of The Gulf Islands

Locally, in our just slightly apart Gulf Island region, we have some serious issues facing us, in 2014:

1 Salt Spring Island is going to choose, in the November civic elections, whether to continue with the Islands Trust & CRD governance model or whether to go forward with a Gulf Islands Municipal structure.

The Trust document, in place since 1974, with its strict land use zoning/bylaws, would remain in place in a Gulf Islands municipal model.

The CRD (Capital Regional District) function would be replaced by an elected local mayor & council (the two trustees would be designated from the locally elected council).

All taxes raised on Salt Spring would remain on Salt Spring. Current grants from CRD would disappear. The other Gulf Islands would no longer benefit from monies raised on Salt Spring, a change that is bound to have implications for less populated Gulf Islands.

There will be many public meetings on this issue, during the run-up to the November elections…be informed!

The “preserve & protect” mandate, from 1974’s Trust inception, did preserve the park-like status of the Gulf Islands.

Evolving over time from summer places to retirement choices to year-round communities relying on tourism, the Islands were all seriously affected by the severe economic downturns between 2008 & 2012.

Younger families found it difficult as jobs erased (no construction if no real estate sales if no tourism…& around the wheel goes).

Aging retirees were rethinking country living…downtown city life, in a condo, with no need for a car, & close to medical options, suddenly had allure, as the aging process continued.

Demographic shifting was underway, & happening at the same time as all other changes.

If Salt Spring does vote for a Gulf Islands municipal structure, will that allow for creativity in decision making? Will it be possible to re-energize the community? Big questions! Certainly, the status quo does not seem possible in any venue, including in governance models.

Your voice is important. It’s your Island! Take part in the discussions.

2 The B.C. Ferries decision to cut service on some routes (coastal ferries, not interior ones), & to raise fares significantly, & to cut the seniors free fare for pedestrians or driver, on non-weekend days, will affect all Gulf Islands & Vancouver Island.

Tourism drives business on Vancouver Island, on the Gulf Islands, & on the Sunshine Coast…the very coastal communities that will be affected by Ferries decisions.

A tourist visits, falls in love with an area, buys a property through a realtor, & then every other business enterprise follows in activity: contractors, excavator operators, building inspectors, designers, plumbers, electricians, well drillers, soft furnishing providers, landscapers, gardening services, cleaners, restaurants, marine facilities, golf courses, service clubs, fitness gyms, hospitality options…you name it, if it’s an item or a service being provided to a consumer, then the process in any secondary home region initially had its start with tourism. No different on our coastal region!

On the coast, Ferries had (until recently) been considered as part of the B.C. Highways system. They were not meant to be cruise ships. After the economic collapses of late 2008, the tourism industry also suffered a downturn. One can see that lower ridership for 4 to 5 years, due to reduced tourist activity in the severe downturn, would result in shortfalls at B.C. Ferries. 2013 saw a renewal in tourism in most coastal communities. Perhaps the natural swings of market conditions should be allowed to re-create growth?

The Chambers, for all the coastal communities, are getting together to lobby the provincial government to hold off on proposed changes to Ferries scheduling & fares for 2014…& to have workable solutions in place by 2015. All parties recognize the need for change.

Although affected less adversely, as it has 3 ferries & 3 different routes, Salt Spring is joining with all coastal communities (Vancouver Island & Sunshine Coast, plus Haida Gwaii & northern coast, & all other Gulf Islands) in working for a pro-community & pro-tourism outcome. Stay tuned…get involved!

3 The local weekly newspaper on Salt Spring has been printing a real estate supplement, in some form or another, for my entire career (since 1989!). A couple of years ago, some realtors lobbied the paper to drop the monthly presence to seven issues. This reflected the lack of sales activity during the downturn & the continuing high costs of print advertising. Now, the same realtors would like it reduced to 4 (possibly 5) issues. This is certainly all a result of the suppression in real estate sales between 2008 & 2013.

Real estate is totally about the rhythm of “now”. It’s definitely driven by immediate & current information. A supplement that right now (7 issues) remains in place from mid-November to end of February, & then again from end of February to end of May, is already meaningless. To go to 4 or 5 issues is the description of a tourist brochure, not a real estate catalogue.

If the Driftwood paper has relied on realtor ads, to date, as the largest advertising segment, what outcome will result if there is a further reduction in numbers of supplements?

Certainly, we all accept that almost 100% of real estate searches start on the Internet…however, it can take a good 2 years before such casual searching solidifies into a decision to buy. Is print, at the community level, still helpful in creating a local presence?

In a discretionary area, it can take much longer than a 2 year timeline to choose a specific community…a lot of window-shopping & region interviewing goes on before that specific decision is made (often decided in 4 weeks, after that slow 2 to 5 year identifying search).

If the real estate print supplement disappears, no longer a current marketing medium, then what will happen to the weekly community paper? Will jobs be lost…staff perhaps leaving the island…another example of changed business models and the need to be where the consumer is? Outcomes, outcomes….

4 Many storefronts throughout Vancouver Island & Gulf Islands & Sunshine Coast have disappeared from their retail locations. Absence at streetside or in a mall does not necessarily mean a business has gone under…it might mean the owner chose to go online as soon as the lease on the physical space was over. What does this portend for real estate investment in commercial plazas? Small shopping centres? Rental income from storefront tenants may no longer be a landlord’s guaranteed investment outcome?

5 We’re hearing a lot about 3-D printers right now. Manufacturing, storage facilities, shipping of products, handling of same…these are business segments that will all change & possibly disappear.

Good outcomes are being reported: a design for a prosthetic limb for a child wounded by an unexploded bomb in an African field is emailed & a 3-D on site printer creates the item for the specific need. Along with this humanitarian outcome, there are other aspects to the demise of manufacturing & supply opportunities.

If those who lose the old jobs have no other option, does that mean the age of jobs is truly over?

It’s being projected that within two years most people will have affordable access to this 3-D technology.

So many more things are being invented, constantly, daily, all capturing the real gift of the Internet…the ability of a consumer to achieve an individual need, in a cost effective way, without the need for a middle segment handler.

This innovation is a good sign, I believe, and this spirit of discovery could benefit any region. Change can come from anywhere, post-Internet. You might have the answer….

Hmmm…what does all this shifting mean for real estate sales? Particularly in the secondary home/discretionary regions?

I think the perception that Ferries are too expensive may harm business success in all coastal communities. I do think tourism is the igniting engine of a discretionary region’s community growth.

Perception can be taken as reality in this instant Internet age. A bad impression of Ferries travel may be difficult to recover from. Get involved with the coastal ferries communities initiatives.

An aging population on the Gulf Islands, with the lack of opportunities for younger families, means a potentially less vibrant lifestyle on the Islands.

The final outcome of the 1974 Trust document, without any change to the mandate, may end up being the creation of enclave areas, where seasonal global owners either bring their own with them or are serviced by off-island centres. That means a ferry connection or perhaps even a bridge.

Hmmm…in preserving the park & ignoring people outcomes, over the many years between 1974 & now, is this the law of unintended consequences at work?

On Salt Spring, pay attention to the public meeting debates pre-civic election: stay the same or do a Gulf Islands municipal structure of government? Choice, choice, choice….

Real estate sales numbers and values of properties are directly impacted by outcomes. Why move to Salt Spring? (or Galiano, Mayne, Pender, Thetis, Gabriola, Denman, Hornby, Quadra, Cortes?…or even to Tofino/Uclulet, to Parksville/Qualicum, to Courtenay/Comox, to the Cowichan Valley?). An important question.

Right now action? Join the local Chamber, if you’re on Salt Spring. If you offer an item or a service for sale, then you’re in business.

At the moment, the Chamber is the only voice on the Island to be able, legitimately, to lobby the provincial government, on behalf of the community’s business interests.

Advocacy, information, support, education…important options offered by your Chamber, a non-profit, working for your best interests. Get involved!

A thoughtful & caring population can figure out solutions to issues that are suddenly everywhere…it’s about fitting into the true script of the 21st Century. Technology is just the expediter of a mind’s solution. The first step? Get involved.

2014 may be the year of recovery in the secondary home/discretionary regions, and globally so. It’s not an even-handed recovery pattern…faster in some areas & slower in others.

For real estate seekers, I think the interviewing an area moment will precede any purchase. Each area is in competition with another. Why you? Why here? Why not there? Important to have an answer! Sellers need to visualize the buyer point of view more intensely than ever.

A community’s health is dependent on the intangible of the desire to live there. Hmmm….

In change lies opportunity. Let’s not forget that!

Salt Spring Island & the Southern Gulf Islands offer beauty, a temperate climate, the ability to be self-sustaining, with a thoughtful & environmentally aware resident population. The Islands are in the heart of the best protected boating waters in the world. They are close to major centres & yet offer that safe haven “apartness”…definitely a recipe for an enjoyable & year-round lifestyle.

Property prices have reduced, over the 5 year downturn, between 29% & 45%, depending on your start date for the flattening of action. A soft uptick in sales volume in 2012/13, in the entry-level residential segment, has meant a diminished inventory. A rise in consumer confidence has created renewed buyer interest in a second home/recreational purchase.

If 2014 is the year of the discretionary real estate market recovery, then right now is the optimum time to finally be a buyer. Low asking prices, low interest rates, good inventory choices, & motivated sellers. I call that the tail-end of the buyers market of the past 5 to 6 years.

April 2013, Market Analysis

Spring! Blossom Festival begins the dance of Salt Spring’s season.

We who live here are lucky to celebrate a lifestyle in the midst of beauty. Our wonderful weather “season” is from now until the Canadian Thanksgiving Weekend in early October…this is a treasured location.

Is the government mandated Islands Trust control of growth the reason for the preservation of the environmental beauties of the Gulf Islands? I think so.

The Trust’s mandate was to preserve and protect, for the benefit of all B.C. residents, the park-like allure of these islands, and it was put in place in 1974.

I think most residents & visitors would agree that this was a worthy goal, and that zoning restrictions were there to safe-guard the beauty.

When, though, does a loose body of regulations solidify into intransigence?

Isn’t the point of elected representatives to interpret a regulatory framework, for the good of the overall community? In that interpretive role, isn’t it essential to allow for individual responses without being afraid of the dreaded word precedent? Did the Trust forget the people?

A community’s self-sufficiency is based on the ability of its population to maintain itself, to foster and encourage sustainable growth, to respond to changing times for the benefit of the entire community. Entropy is the result of an unchanging response. Entropy leads to the death of an organism.

Salt Spring has been blessed in past years to be what I call a stand-alone community. One did not have to leave the island for services/amenities unless one wished to…the island was not a bedroom community of towns on nearby Vancouver Island. Can we say this is still the case?

In recent years, did the elected trustees overstep their mandate and stray into lifestyle decisions of the residents? Businesses that gave work to local residents have closed and moved off-island. More may be considering this.

The big box stores in Duncan are only a 20 minute ferry trip away: Home Depot, Walmart, Rona, Staples, London Drugs, plus the satellites that go along with plaza life (Starbucks, Tim Hortons, KFC, et al).

The Chamber of Commerce also has a mandate: to support local/community businesses and to create an atmosphere of opportunity for them. It is a volunteer body.

Salt Spring, as part of the Islands Trust governance model, is not a municipality. There are two elected trustees per Gulf Island. There is also a CRD director…CRD stands for Capital Regional District. This is also an elected position. As an unincorporated area, Salt Spring is under Victoria’s CRD re building permits, septic installations, etc.

One can see, though, as population slowly grew, since 1974, that there was a void there. The Trust is about land use bylaws. The CRD is about granting septic and building permits, so that construction is to current code requirements. There is no local elected mayor/council to aid the community’s progress.

What about an overall plan to ensure that residents lifestyles are also encouraged and preserved?

There is no funding from the provincial government to the local Chamber, as the Island is not a municipality. Thus, Chamber activities to benefit local businesses are all volunteer driven…with monetary support for tourism related events raised from the same local businesses.

The economic meltdowns between late 2008 and late 2012 caused tourism to halt in all secondary home/discretionary areas. On Salt Spring, tourism in 2010 & 2011 was apparently down by 40%. This affected accomodations, restaurants, studios, galleries, real estate…which in turn affected lawyers, contractors, architects, etc. It’s a wheel that rolls or else falters and collapses.

There is, at the moment, a sense that no one has been looking after the preservation of the Island’s lifestyle…no one helping the residents.

When I arrived in 1989, it seemed that “everyone” was here: affluent, old hippies, artists, farmers, retirees, young families, teachers, nurses, ferry employees, retail owners, summer people, spec builders, etc. Just the normal mix in any small rural community.

So…what happened?

Is it just the law of unintended consequences at work? Is it that those initial regulations to address uncontrolled growth have spawned into more regulations, narrowing interpretations of original bylaws, simply to fill a void?

The community did seem, in the 80s and early 90s, to work together…it still comes together to help when someone is afflicted with an accident or loss by outside circumstances. There now, though, also seems to be a very divisive attitude in evidence…fixed positions…no conversation of negotiation.

I sense that Salt Spring is well on its way to being a safe haven for an affluent buyer. It may be that those who service such an area will be coming from off island. The Trust’s point in 1974 was to preserve the park. This was accomplished.

A decision to control growth in a beautiful area does have the effect of making it a place one has to be able to afford. The Trust created, on all the Gulf Islands, an eventual outcome of being expensive places to live. The old adage of supply and demand in play.

It is what it is.

The Trust could have created thoughtful affordable housing zonings, industrial land groupings, & thus have preserved small family businesses, that hire locals, that support other local businesses. They did not.

Currently, there is a governance study underway on Salt Spring. There will be an eventual referendum to decide whether or not to have a Gulf Islands Municipality. This is the second such study/referendum process.

If a yes vote? The Trust would remain, with two elected trustees, and the bylaws in place. The CRD role would be taken over by an elected council, on Salt Spring, and so there would be local people in place to look after lifestyle options for the residents. The encroachment of the Trust into this realm, to fill a void, would end. The Trust, its elected local trustees, and its land use controls would remain.

Very recently, the CRD has struck a committee known as the EDC (Economic Development Committee). This committee has pulled people from local groups such as: accomodations, tourism, chamber volunteer groups…is it a think tank? Is it working to fill that local presence void, in case the governance study outcome is a nay vote? Are your concerns being met? Ask questions!

Is incorporation a good idea for Salt Spring? Attend the meetings, listen with an open mind. It’s an important issue with a serious outcome, on either side of the question.

My hope is that Salt Spring Island will remain that vibrant stand-alone community structure, with opportunity for all population segments. How best to ensure this?

Be a part of the decision making…it’s your island, after all. Be informed.

Tourism engenders real estate outcomes and thus ensuing good business outcomes for all other enterprises. Another reason to support the Chamber of Commerce.

The real estate market on Salt Spring Island, the Gulf Islands, and on Vancouver Island is still slow in sales. There is an increase in interest…inquiries are stronger…there is no marked trend, yet. In 2012, most sales were in entry level residential. In the final months of the year, some upper tier priced residential options found their buyer…at reduced price points from list pricings. Undeveloped land and commercial options remained “flat” throughout 2010, 2011, and 2012.

It may be that 2013 will be a year of authentic recovery in real estate in our secondary home/discretionary area. It may take until July to see this build in. The main sales now take place, in our seasonal marketplace, between mid-July and November. With the impact of the Internet, it’s important to be listed and “present”…otherwise, how will the searcher discover a specific property? Perhaps by early May, the trend-line for 2013 will be sufficiently in place to see a pattern.

The driver to action this year may be the seeking of a safe haven. Preservation of capital and the ability to be self-sustaining are powerful motivators to action. The cash on the sidelines may be flowing back into secondary home markets, and globally so. The issues in Cyprus, towards the end of March, may have hastened this shift out of cash, held in savings, in financial institutions.

Many insecurities abound, globally, and the Gulf Islands are not exempt.

What can we appreciate? A micro-climate that enjoys a year round opportunity, farms and the 10K diet are alive & well. The best protected boating waters in the world, at our doorstep. Ecological beauties to enjoy. Creative & thoughtful people to bring forward solutions to 21st Century issues. Lucky us, we who now call this region “home”.

May I help you to discover your special property on Salt Spring Island, on the Gulf Islands, and on Vancouver Island? Your best interests are my motivation. Please call…look forward to meeting you, and to helping you become an Islander, too!