Tag Archives: Gulf Islands

January 2014, Market Analysis

January 2014, Market Analysis

I find that January in particular, & perhaps the first half of February, often carry forward the specifics of November/December of the previous year, when it comes to real estate activity. An overlap Winter Season rhythm, thus.

Salt Spring Island

Salt Spring Island

In our secondary home & increasingly seasonal marketplace, we now seem to be focused on a March Break to Canadian Thanksgiving (early October) timeline for viewings/sales. The busier months would perhaps be May, July, August, September in our particular discretionary region.

Economic global trends might make themselves more clearly felt by mid-February, too. It’s very difficult, at these opening days of January, 2014, to make any projections about real estate market outcomes for Salt Spring & the Southern Gulf Islands.

My decision this time, then, is to report in at month’s end, instead of at the very beginning.

During January, I will be reading various economic projections, local & global, & will be attending significant economic think-tanks, & will also be keeping in touch with real estate sales outcomes throughout the Gulf Islands & on Vancouver Island. A month of assessing….

On the Coast, the recent B.C. Ferries decision to both cut numbers of sailings/& to raise fares on some ferry routes, may have a substantial impact on the Gulf Islands. It’s a key issue for all coastal communities & local Chambers are connecting to deal with this…including Salt Spring’s Chamber.

Look forward to reporting in to you, at month’s end, with my various findings.

It does appear that secondary home markets are seeing a slow uptick in activity, after a good five years of inaction on the part of a buyer. Sales volume did improve throughout 2013. Price points were still mainly in the entry level residential category.

Is it a sustained growth pattern, though, & will it now encompass all property types & price categories? Will 2014 be the visible face of an authentic real estate recovery in our “by choice” Islands environment? More later!

We are so lucky on Salt Spring Island & on the other Gulf Islands to enjoy a temperate climate, with the ability to be self-sufficient, & yet with proximity to major centres…apart & yet connected. The definition of a pleasing 21st Century lifestyle?

If you are thinking of a property purchase on Salt Spring Island, or on another Gulf Island or on Vancouver Island, please contact me. I look forward to bringing my knowledge (of both inventory & of trends) & expertise (managing broker’s licence & strong negotiating skills) to your benefit. Call me, & discover the difference that does result in connections between a seller & a buyer. The successful outcomes for you, the client, are my motivation.

How may I help you to buy your special Island property?

December 2013, Market Analysis

It’s been an interesting year in local real estate & also in the larger world’s political & economic environments.

The 21st Century is about connectedness, & that means that nothing is too small an event, anywhere in the world…it has an impact on all other regions. The “butterfly effect” is now our global reality.

December 2013, Market Analysis

It used to be said that economic trends were global, but real estate was regional. I’m not sure that this is the case any longer. Marshall McLuhan’s forecast back in the 1970s, of a global village, has come true.

Salt Spring Island, the Gulf Islands, Vancouver Island (outside of core Victoria), & the Sunshine Coast are all secondary home marketplaces…retirement, recreational…discretionary choices, thus. They mainly rely on a non-local buyer profile…someone wanting to move there from somewhere else.

No one “has to” buy a property on Salt Spring, on Mayne, on Galiano, on Thetis, or on any other Gulf Island. No one has to buy in Tofino/Uclulet, in Parksville/Qualicum, in Yellowpoint, Maple Bay, Cowichan Station…or in Sooke or in Courtenay/Comox…or in Sechelt, Robert’s Creek, Gibson’s. These are all regions that have to be chosen by that mainly non-local buyer…thus, the buyer is always in charge of the “where” & the “when” of purchases.

Read the full article…

October 2013, Market Analysis

October, 2013.

Ganges, 2013

Ganges, 2013

It’s odd how the Pacific Northwest Coast has a “tail of the dog” pattern in real estate sales…you know: last down & last up.

The real estate market in many other regions in North America is showing a strong recovery. This began in 2012, unexpectedly & strongly. Yes, it began in entry level residential, but it has now segued into the upper tier priced residential options in many areas.

Yes, the buyer is still in control in the upper level pricings category…not so much in the entry level residential segment. In some regions, there are multiple offer situations, price solidity & even price uptick, as inventory thins. Pricing is always driven by supply & demand. As sales remove upper tier priced properties from the market, we will see price solidity there, too.

What is driving the demand? Perhaps a recognition that the value of cash is negligible? Hard assets can become a vehicle to preserve capital.

Along with that, there is a sense that our long accepted world is imploding…change is the mantra of our post-Internet time…perhaps a purchase in a discretionary/resort based/secondary home environment might be seen as a safe haven investment?

On the Pacific Northwest Coast, outside of the city/primary residence markets (Vancouver & core Victoria), it’s been a very slow uptick…the secondary home/discretionary marketplace follows its own rhythm. It has been very flat for past 5 to 6 years. So important to look down the highway & not in the rear-view mirror. Shift happens fast!

While undeveloped land, commercial/business options, & very high-end residential properties remain fairly flat, there are whispers of uptick.

It may be that this Fall Market will be the end of the buyers market pattern in our kind of coastal market. This secondary home/discretionary marketplace includes all Gulf Islands, all of Vancouver Island outside of core Victoria, & the Sunshine Coast. These regions are about choice…not necessity.

However, a seeking of a safe haven is a powerful motivator to action (action has been lacking in the past 5 to 6 years, in all secondary home markets…Spain, Aspen, Salt Spring Island, Palm Desert, Hawaii, Turkey, Tahoe, etc…now, potential buyers appear to be seeking out those slightly apart enclave areas…a pleasing lifestyle but not visibly so)…hmmm…describes Salt Spring & the Gulf Islands very well!

I have often thought of the Gulf Islands, including Salt Spring Island, as the castle…the moat is the sea…the drawbridge is the ferry access. All the amenities/services required for a pleasing 21st Century lifestyle, with that yesteryear apartness, are all certainly available on Salt Spring Island. Plus, a temperate climate that encourages vineyards, olive groves, orchards, that 10k locavore experience…one can be self-sufficient here.

It is, post-Internet, an international buyer profile on the Gulf Islands/on Salt Spring Island. Time is a component in all sales. Time to discover, time to ponder & to compare, time to choose. It can take one to three years to sell any Gulf Island property, in a “normal” market…in a suppressed market, perhaps five to seven years. No one “has to” buy a Salt Spring Island or Gulf Islands property…it’s always by choice & so is beyond market statistics, in a way. Days on market are irrelevant in a discretionary region…price reductions to generate action don’t work…a buyer has to feel the confidence that it’s time to act. In a downmarket economy, discretionary purchases can be put on hold. That pretty well describes the past 5 years!

There are cycles in all markets, and we may be heading into year 9 of a 10 year cycle. We should experience a market uptick in pricings, then, quite naturally, & of a significant nature, as sales build.

On top of that, we have the societal shifts wrought by the Internet, and we also have the continuing repurcussions of the economic meltdowns of late 2008. Preservation of capital is on everyone’s mind. Physical safety is a concern. Is it possible to be slightly apart & also to be self-sufficient?

All of this uncertainty may be the key driver back to real estate investments in secondary home markets…a flight to safety, both physical & economic.

Call me about the advantages to an investment in Salt Spring & Gulf Islands & Vancouver Island properties (Vancouver Island is perhaps just the largest of the Gulf Islands). I look forward to sharing statistics with you, & to discussing the slow forward momentum in real estate sales in this particular coastal marketplace.

June 2013, Market Analysis

June 2013, Market Analysis

Here we are in June…the half way point in this oddly (to date) haphazard sales year.

In 2012, the majority of sales were in the entry level residential category, and sales took place right from early January. That was unusual, as normally March Break begins a sales pattern. A very few upper tier priced residential options did sell in 2012, but at markedly lower prices than sellers might have hoped for, and these were mainly waterfront choices.

Entry Level Residential Sales Remain Unchanged

To date, in 2013, this pattern of entry level residential sales remains unchanged, although sales did not begin to broadly appear until closer to March…a more typical action.

Galiano 2 Homes & 2 Docks

Galiano 2 Homes & 2 Docks

The bulk of sales remain in that beginning priced residential segment and, again, a very few upper tier priced residential offerings, still mainly waterfront choices, have found buyers.

Many of these waterfront sales, in both 2012 & this year to date, had been on the market for 2 to 7 years, had seen substantial reductions over time, & then received a further reduction at the offer point. In other words, the buyer was in charge of the process.

Price reductions of a substantial nature continue to come in, on a consistent basis, from some realty companies. This may have more to do with the need of that realty company to generate income to balance the very expensive outgoing costs of being in the real estate business.

Local Market Manipulation

Local market manipulation is a real thing, however, and all sellers have to respond to this in an effort to remain competitive in pricings…a series of reductions from one company will then, in the end, impact listings prices from all companies.

A very few undeveloped land options have sold this year, and that is a heartening sign. I always think that sales of raw land are a true indicator of an authentic real estate recovery in our kind of secondary home/discretionary marketplace. In a downmarket, the few buyers around are attracted by rental or income producing options…thus, raw land can be overlooked.

Our Gulf Islands sales window has shrunk to May to October. People may make offers at any time…chances are, though, that they viewed during this narrow timeline of physicality.

It may take until August to understand this year’s market pattern, as there are not enough sales yet to point to a trend. All we can say is that sales volume continues as in 2012, and that there are a lot of choices in residential offerings over 600,000.

Property Inquiries on the Rise

Inquiries do appear to be on the increase, and that’s a good sign! Physicality will follow. Some new listings, in the waterfront segment, are coming onstream at 2007 price points. That is also interesting….

The Gulf Islands form of governance is the Islands Trust. Created in 1974, with a mandate of “to preserve & protect” the environmental beauties of these islands, for the benefit of all B.C. residents, this Trust thus controls growth via severe zoning/bylaw restrictions.

So…sounds like limited inventory, over time, to me.

What’s Next?

As we climb out of the downturn that has gripped all secondary home markets since mid-2007, we will start to encounter a lack of inventory, based on this non-growth Trust stance…just as buyers are once again seeking places to preserve their capital.

Sounds like sellers market conditions are reappearing, in other areas. Multiple offers are being reported in busy primary residence regions. Hmmm….

Important to be paying attention to the shift moment, whether as a seller or a buyer, at this mid-way point between market trends.

Yes, very essential to know the past sales, but also important to recognize the uptick. Pricing by a seller & offered price by a buyer, at such a mixed time, are both needing extra thought.

So, the Gulf Islands (including Salt Spring) have bylaws that control/restrict growth. Plus the real estate market in secondary home/discretionary regions may be entering a recovery…in year 8 of an 8 to 10 year cycle? Buyers have again decided to act. The driver to buyer action may be a safe haven seeking…a hard asset purchase to preserve capital.

Prices have not yet stabilized, but this is just the beginning of our “season”…May to October…will prices be showing firming, by September? Hmmm….

The supply & demand rule is the marker of change.

Important to be paying attention to the “now”, and not to the flatness of the past 5 to 6 years. No rear view mirror reflections, then. We need to be looking ahead.

In change lies opportunity.

When should I be purged from the database?

20130422-121720.jpg

Change, change, change….

I think it’s the mantra of our time.

Spoke earlier to a woman trying to sell advertising space in an English based magazine…the target market was a live/work somewhere else in the world scenario.

She called me because my name was on a database from 2010…I had advertised in a magazine targeted to people wishing to immigrate to Canada. That magazine folded after 11 issues, she told me…because advertising revenue had evaporated by 2011.

Ah, yes…publishing as it used to be done…another casualty of the big eraser we call the Internet.

Nothing has remained untouched. No business model has been left without serious change or even collapse.

My more focused eye is targeting my specific area…Salt Spring Island, the Gulf Islands, & Vancouver Island. Secondary home marketplaces, all. Recreational, retirement…and on the Gulf Islands the added aspect of being under the Islands Trust jurisdiction. No one “has to” buy in a discretionary area. How to connect with the interested and qualified buyer, when no one is local? That is the question!

Nothing wrong with change. It does bring opportunity. It can also create chaos, though, as one lifestyle slides through the sandpiper mitt into the next style.

Hmmm. Some things to do: increase your veggies & greens intake. Walk 30 minutes a day. Get up & walk around…don’t sit non-stop at the computer. Read something that has nothing to do with your job. Learn another language (better than crossword or sudoko puzzles, to keep your grey cells perking along). Breathe…listen to music that energizes you…dance! Important to keep oneself in good order so can tread water in the sea of change…en route to the dry land of the new.

And your thoughts about how to keep your ship on an even keel, on the ocean of change? Always welcome!

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!