Tag Archives: Real Estate

Salt Spring Island, April 2023, Market Analysis

Unique Real Estate in Unique Areas

The very beginning of April is with us. T.S. Eliot poetically stated that “April is the cruelest month”. Perhaps he meant that the month begins with the face of March still in place (aberrant weather events) and ends with the wondrous and fully flowered May promise.

What about the real estate market on Salt Spring and the Gulf Islands at this very beginning of April?

All coastal markets are noting that low inventory is continuing.

In the main, locally, many owners are choosing to hold what they see as a good investment…a property on a Gulf Island. The Islands Trust form of governance (put in place in 1974, by the provincial government, to “preserve and protect the environmental beauties of the Gulf Islands, for all B.C. residents”) effectively capped growth through strict zoning/bylaws controls. Regardless of market trend, there is always a low inventory on a Gulf Island. An investment security net?

Occasionally, an aging owner might consider moving…but low inventory is an issue everywhere and they can’t find an option in that area they would consider moving to. They don’t want to be houseless and so do not list.

Global Events

The federal government is seeking strong immigration between 2023 and 2025…up to 1.5 million new arrivals. This policy is happening at the same time as continuing low inventory for either purchase or rent, across the country. For decades, lack of housing has not been addressed. A recipe for price stability and price escalation?

There are many events, often of a global nature, and so beyond individual control, that could be described as “worrying”. Wars & rumours of wars, supply chain issues, insecurity of interest rate rises, currency concerns, stock market fluctuations, a fear that banks will fail, shifting job markets…what to count on? Chaos is a factor.

Post-pandemic, the entire work environment has changed. The ability to work from home, as the internet finally authentically made this possible, has put rural and urban living on the same footing. This may be a driver to action as buyers sell their urban lifestyles and choose rural. A kinder, gentler experience?

In a time of extraordinary change, it’s ever more important to focus on our periphery vision and not to follow the narrow channels prepared for us. Understanding the societal effect of a robust artificial intelligence might be worth a look. Back up a bit, see what flickers on the edges of our visual sphere and pay attention to that…it’s where creativity lives…and any one of us can create the new. Are you looking?

The Preservation Cap?

So, at the very beginning of April, there are not a lot of real estate choices for a buyer in any property type or price point.

Plus: A call from the federal government for significant inward migration.

A desire from a buyer to live in smaller areas that offer a pleasing lifestyle. The fulfillment of the long-standing government “preservation” cap on growth on Gulf Islands. The allure of real estate as a good hard asset investment to preserve capital. The messages seem to suggest that unique real estate in unique areas will continue to be a stalwart investment choice.

April. A good time to immerse into Nature. The annual promise of renewal…Spring’s gift. Important to “see”. Maybe even to look back at another era of extreme change and societal upheaval: the Industrial Revolution of the 19th Century. Time to reconnect with the Romantic movement in literature and music? Their emphasis on the inspirational natural world might work in our era, too?

Things To Do on Salt Spring this Spring

On Salt Spring? Catch the annual Spring Art Show, drop into the annual Home and Garden Show, enjoy the Spring menus at our great dining spots, renew with a healing arts moment at one of the spa opportunities, see an event at ArtSpring, picnic at a beach, explore the hiking/walking trails, kayak to Chocolate Beach…Spring says get up, spruce up, get out…open the doors and windows…breathe.

Salt Spring Island, December 2022, Market Analysis

The first of December is considered meteorological Winter, although the calendar says it begins on the 20th. The great Pacific Northwest Coast experiences shorter days (dark by 4:30 p.m.) and every year is slightly different, weather-wise. This year promises snow and arctic cold. I prefer the usual rain that has our west coast location often described as “the famously wet coast”. (I am allergic to snow at sea level).

Salt Spring Island

Things To Do on Salt Spring Island This Winter

Lots of art gallery openings and receptions in December, plus the annual WinterCraft at Mahon Hall until the 23rd, the annual Beaver Point and Fulford Hall craft fairs (December 2 to 4), and other loved pop-ups…closed for two seasons due to covid closures, these displays of artistic flair are welcomed. ArtSpring offers choral/seasonal concerts…check out the website for dates. Enjoy the lights in the Village, and the decorated shops. Tasty special menus at coffee stops and restaurants…decorated farm gate stands encourage a jaunt around the island. Live music venues (Moby’s, the Legion) are fun. Check out the Christmas on Salt Spring events (the Chamber of Commerce website or Visitors Centre). Does Santa really arrive by floatplane?

Close to major centres and yet wonderfully apart…a visit to a Gulf Island/to Salt Spring Island can be a restorative and peaceful experience at this softer Winter season.

Real estate at this end of the year

Real estate at this end of the year time is still consistently chugging along. Buyers remain interested and active. Snow storms mean some delays for some viewings, but Winter does not last long in our region. Inquiries remain strong. Winter is often a weekend business in a secondary home market. The lack of inventory remains a factor. The desire for a buyer to leave the city and to live in the country is still the main reason for activity. That authentic internet connectivity allows this profound lifestyle change. A softer gentler lifestyle seems to be the goal. A very human need: to be safe.

Housing Supply & Purchase Taxation

The governments (provincial and federal) are attempting to solve the lack of affordable housing supply through taxation (offshore purchase taxation, empty home (speculation) tax, moratorium on non-Canadian buyers, interest rate rises), and yet the federal government is also looking for 1.5 million immigrants by 2025. CMHC has forecast that 22 million housing units would need to be in place by 2030, to solve this “lack of housing” crisis (not including immigration pressures).

First time buyers are affected by the series of interest rate rises. Some experts are forecasting more rate rises to come…others think not (possibly fearing societal unrest?).

Affordability is tied to supply…instead of taxing existing options, which does not grow supply, governments need to encourage construction…an entrepreneurial answer to supply and demand issues.

Real Estate – Still A solid hard asset investment

Meantime, real estate remains a solid hard asset investment (especially during currency fluctuations) and keeps pace with inflation.

December is a time to be thoughtful, a time to acknowledge traditions and to practice the art of gratitude. A time to create new traditions and to include those on their own in our celebrations. It’s fun to research other seasonal events and definitely important to have lots of candles, have a fire in the hearth, and to invite light into our homes. Maybe a year to reread Charles Dickens’ classic: A Christmas Carol?

Feasting is allowed. A pause is encouraged.

December…a time of joy. Good to partake.

Salt Spring Island, November 2022, Market Analysis

What about the real estate market as November begin

November…the season of craft fairs and holiday events. Standard Time returns (Fall back, remember). Shorter days/longer nights…rain, rain/sun mix, golden leaves scratching across pavement, temperatures cooling quickly.

After a 90 day warm and sunny drought, with rivers and creeks so dry the spawning salmon could not fulfill their October cycle, everyone is glad to see November rains appear.

November also brings Remembrance Day…wear your poppy, and if on Salt Spring try to be at the cenotaph for this annual community tribute. Thank you to those who served.

What about the real estate market as November begins? Several years ago, Salt Spring and the Southern Gulf Islands became a Fall Market. Although basically a seasonless marketplace, with buyers arriving throughout the year, there are high point times for sales. Fall is one of them. Late August to year end can be busy.

The Spring/Summer market was a holding pattern

2022 saw a “six weeks late” scenario. Spring was late (remember Juneuary?). The farming community noted that the growing season was six weeks later than usual. This flat-line “pause” seemed to be mirrored in real estate activity. The Spring/Summer market was a holding pattern.
Salt Spring
If 2021 was the year of consistent sales and multiple offers, 2022 has been the year of “maybe”, from a buyer perspective. (Maybe I will decide to buy a property…or maybe I’ll see how things play out. What about interest rate rises? When will there be more inventory to choose from? Will prices go down substantially? Should I act now or wait and see? What about all the chaos globally? Supply chain issues? Wars and rumours of wars? Will renewal of covid shut things down again?). Worry is the background sound of 2022. Uncertainty can create pauses in action.

 

A pause is not a correction

Mount Baker
A series of substantial price reductions took place in late Spring/early Summer, but many of these reduced properties still remained without showings or sales. The six plus week pause in activity was not about price, then. Worry, worry, worry…and worry makes a buyer just tread water. A pause is not a correction.

Lack of supply is the key to market outcomes. The low inventory in properties for sale will continue. Inward migration is also a factor. The flight from urban to rural remains a principal driver of action. Time is a component in most secondary home sales, once again. Media reporting on all markets is always reactive, not predictive. September “reports” might be reflecting June…December will give the picture of September…and so on. The bottom line: lack of supply and desire to buy.

Activity is filling in again

As buyers slowly digest the parameters of this softer marketplace, activity is filling in again. A desire to be safe, and to preserve one’s capital…these are strong reasons for a buyer interest in rural lifestyles. The authentic ability to work from home, via a robust internet, is a further stimulus to a rural decision. To be “apart”, as 2023 unfolds…with its suggestion of further upheaval…perhaps makes good sense.

Ganges

So…November. On Salt Spring and the Gulf Islands? Catch the galleries and craft fairs…special and unique opportunities to “shop local”. Dine out at our amazing and varied restaurants…local produce & talented chefs. Hike the trails around the islands on the finer Fall days. Try a restorative spa ritual. Galleries invite one to enjoy the amazing artistic talent. Remember the value of taking time…a softer season reminds us how to “see”. Maybe join a choral group…or learn line dancing (yes, they still do this). Evening classes offer new discoveries.

Seeking your special Gulf Islands property? Benefit from my knowledge (of trends and inventory) and expertise (managing broker licence). Your best interests are my motivation. I look forward to hearing from you (liread33@gmail.com).

Softer…slower…a different kind of rhythm. Salt Spring smiles its November hello.

Salt Spring Island, June 2022, Market Analysis

Salt Spring Real Estate Market, June 2022

Almost everyone agrees that the entire Pacific Northwest Coast (this includes Salt Spring and the Gulf Islands) is approximately six weeks behind the normal Spring weather pattern. A typical La Niña weather outcome. So…June will be May. Some forecasters say we may not see “real summer” until mid-July

Global Events & Salt Spring Island Real Estate

Meantime, the global concerns continue to roll along: wars and rumours of wars, stock market wild fluctuations, continuing pandemic concerns, supply chain disruptions, immigration pressures due to population dislocations, inflation, and the ever evolving tech changes that make some business models redundant while others become breakthrough patterns leading to the future. Well, that pretty well sums up this societal rewrite that is underway. That means individual lifestyle changes, too. Change is never easy…yet opportunity does live in change.

The lengthy covid shut-downs, with many events and businesses closed down for almost two years, did create anxiety, worry, and fear. In keeping lifestyles tamped down, out of fear, and so causing the demise of many livelihoods, quick trigger responses were also created…anger under the surface. Recovery after traumatic experiences takes time. As we hopefully continue to segue out of a closure mind-set, it’s important to be patient. It is easier to close down than to re-open. Essential to remember that we all recover from significant change differently…it is never one size fits all.

And what about real estate markets? The rush from urban to rural, brought on by the covid closures of 2020, and encouraged by the authentic ability to work from home, are still the main drivers to action in the secondary home markets.

In the main, the buyer profile on the Gulf Islands and on Vancouver Island is a Vancouver purchaser. The secondary home/recreational areas in B.C. depend on a busy Vancouver sales scenario. Pauses in that major city market create pauses in the rural outcomes. Low inventory and buyer interest still remain in place, at this time.

Residential Listings

At this very beginning of June, there are approximately 63 residential listings on Salt Spring Island, not separating out waterfronts, view, farms

  • Sixteen of these are listed between 239,000 and 995,000
  • Twenty-six of these are listed between 1,125,000 and 1,998,.000
  • Nine residential listings are between 2,100,000 and 2,890,000
  • Four are listed between 3,333,000 and 3,995,000
  • Two are listed between 4,395,000 and 4,595,000
  • Two are listed between 5,790,000 and 5,990,000
  • One is listed at 6,950,000
  • One is asking 11,975,000
  • Two are listed at 14,000,000

There are approximately 24 land listings on Salt Spring Island, at this very first of the month, not separating out waterfronts, view, farms, lots or acreages…simply undeveloped land.

  • Nineteen of these are listed between 259,000 and 998,000
  • Three are listed between 1,038,000 and 1,495,000
  • One is listed at 2,995,000
  • One is listed at 5,400,000 (a farm, three titles, 17+ acres)

Inventory Remains Low on Salt Spring Island

Inventory remains very low. There are now some price reductions on the way to a sale, unlike the consistent bidding wars seen in mid-2021, and often there are further reductions at the point of a sale. The key seems to be about the amount of remedial work that may be needed by a property listing. A step-in ready home may sell at list price…there may be more than one offer and thus sell over-ask…but this is less often than in 2021.

Salt Spring Island and the Real Estate Services Act

The frenzy of sales action occurred between February and September 2021, and buyers (perhaps out of fatigue) are more measured in 2022. In response to Vancouver’s hot market in 2021, the provincial government is bringing in further significant changes to the Real Estate Services Act, throughout B.C. These changes may be in place by summer. One such would stop blind bidding and another would enact a three day cooling off period for a buyer, after an accepted offer. Stay tuned for more definitive information on these important changes.

Was this past February the “top” in buyer activity? Perhaps for the short-term moment…it is about supply, though, and the serious lack of housing supply may continue to uphold the sellers market scenario for some substantial time yet. Low supply and the strong desire to be safe…which implies a seeking of a rural/apart lifestyle…continue to propel the Gulf Islands markets. In inflationary times, real estate is also often viewed as a hard asset that keeps pace.

Sales on Salt Spring Island

At this very beginning of June, there have been approximately 80 sales to date on Salt Spring

  • Forty-six of these have sold between 100,000 and 998,000
  • Twenty-nine of these have sold between 1,038,000 and 1,995,000
  • There were four sales between 2,000,000 and 2,559,000
  • There were two sales between 3,200,000 and 3,725,000

Meantime, whether it’s a continuing late Spring as June unfolds or a quick segue into summer-summer, the natural beauty experienced at this time of year is an inspiration. In our always daily busyness, it’s important to pay attention to this lush beauty displaying around us. Salt Spring and the Southern Gulf Islands are in the heart of some of the best protected boating waters in the world (a kayakers dream) and are located mid-way between Vancouver, Victoria, and Seattle. Easy to get to, and yet wonderfully apart.

Always Opportunity on Salt Spring

There is always opportunity if you are seeking to buy or to sell a real estate holding. In these erratic times, on either side of the sales equation, creative thinking can carry the day. The Islands Trust, a provincial government body created in 1974, to preserve and protect the Gulf Islands, capped growth via strict zoning/bylaws. This ensures low inventory, regardless of market trend in play. More information on this non-municipal form of governance?

Market Analysis, November 2018, Salt Spring Island

November 2018, Salt Spring

The Fall Real Estate Sales Season

November 2018, Market Analysis

The Fall real estate sales season separates into two parts: late summer/early Fall (end of August to mid-October) and late Fall (mid-October to early December).

Salt Spring is really a “seasonless” market…buyers turn up throughout the year, and sales from later in a calendar year can take place right into very early January of the following year.

Although tourism is most evident in late Spring/Summer months, and a successful visitor experience usually leads to a real estate purchase in our discretionary marketplace, the two don’t always occur at the same time.

It often takes two visits, if not three, for an interested potential buyer to decide to make an offer. There can be substantial time lags between visits…it can take one to two years to have a successful sales transaction, even in a buoyant real estate trend.

Where Do the Buyers Come From?

Buyers are not local. They look in other areas, too. It’s perhaps about “being sure” about the “where”.

Whether they live a ferry trip away or are a substantial flight distant, the buyer usually leaves some time between visits (a few weeks to several months). Their own lives come first and it just takes the time it takes to have a result in any secondary home/discretionary marketplace.

That said, we enter November 2018 with a continuing “thin” inventory of available listings.

Prices stabilized in Fall, 2017.

The provincial government’s February 20, 2018 budget included taxation measures to cool the Vancouver market.

These measures were also expanded to include Victoria, Nanaimo, and Kelowna.

Since mid-2016, Salt Spring has been chiefly dependent on Vancouver buyers. As a recipient marketplace, Salt Spring is affected by events in the areas where the buyers come from.

Anecdotally, it seems that people take around five months to get over anger at something and then to just get on with things. The lack of solid action between February 20 and September 15 has now been replaced with some increased activity. Hmmm….

The last two months of a year and the first two of the following year can be seen as a cohesive timeline.

A Market Trend for properties below 900,000

The market trend right now is showing most action in properties below 900,000. Over half the current listings are over one million. Will we see substantial price reductions at the point of an offer, in order for a transaction to proceed to completion? Will prices begin to suppress, to reflect those marked reductions now evident in Vancouver? Are we starting back into buyer’s market territory? Hmmm….

November 2018, Salt Spring Real Estate Market

Although there is a lovely sense of apartness to the Salt Spring lifestyle, no location is exempt from global issues. Currency concerns, tariff wars, prohibitive tax measures, etc…outcomes in countries around the world also end by impacting SSI. There’s that butterfly concept again.

Uncertainty is not good for any market. We began 2018 with a strong seller’s market underway. We are ending 2018 with the impacts of the coalition provincial government measures to suppress that Vancouver “hot market”. These measures, short term, have been successful.

At the same time, there does seem to be renewed interest out of Ontario (other provinces like to retire to coastal communities). Toronto does not have the tax suppression measures seen in Vancouver. That may augur well, going forward into 2019.

Albertans & US Buyers?

We are still not seeing Albertans or U.S. buyers. Before the economic meltdowns of late 2008, these two buyer profiles were 50% of our buyers. They were also seasonal. The Vancouver buyers want to live on Salt Spring. This may be why they take longer to choose the “where”. Salt Spring has competition from nearby Vancouver Island communities…why choose here? Why not there? Hmmm….

Late Fall-into-Winter season, a softer time for tourism, is also an opportunity. The fallow field moment allows for some creative thinking, to keep that Salt Spring allure in play. The outcomes of the “real” 21st Century are around us all…Salt Spring is not exempt from the profound technological changes that are now the surround sound of our lives. Yes…block chain technology is our present.

Initially, the Islands Trust, created by the provincial government in 1974, had the purpose of preserving the environmental beauties of the Gulf Islands, for the benefit of all B.C. residents…the Trust capped growth and effectively created a park-like ambiance. Now, in our always-on, always-connected world, perhaps the real value of visiting and of living on Salt Spring Island is the ability to enjoy an experiential lifestyle…and not a mere searchable environment.

The Gift of Reality

The gift of reality…real reality, not virtual, not augmented…perhaps that’s the point of 1974 meeting up with 2018?

Markets are always a wave of up and down. Over time, an investment in real estate, in an area where growth is strongly controlled, where a community blueprint pays homage to 1974 concerns about over-growth, will become an enclave area…it will rise in value. Important, then, to always be thinking five years out.

At this moment in time, listings remain low, buyer interest is very present, and the allure of Salt Spring as a destination is high. Projections for early 2019, in areas that deliver buyers to Salt Spring, are about a bounce back in real estate dynamics. Hmmm….

Meantime, November unrolls before us: craft fairs (WinterCraft), Village galleries showcasing their artists, studio tours, continuing Farmers markets, theatre and dance and choral presentations at ArtSpring, hiking/walking trails beckon, and kayaking adventures and sailing races delight year-round.

There’s always lots to see and to do, on special Salt Spring Island.

Enjoy the softer season!

Market Analysis, October 2018, Salt Spring Island

October 2018, Salt Spring

Ganges Harbour

Ganges Harbour

We are now well into Fall…all the Harvest events, Farmers Markets, farmgate stands are busy inviting us to enjoy this fruition time.

Early Fall is a mix of rainy days, sunny days with almost summer warmth in afternoons, darker mornings and evenings as the days shorten…plus crisp evenings perfect for star watching. And yes, that is Orion, the Hunter constellation, creeping up the sky…the herald of Winter.

The Fall Market in real estate on Salt Spring and the Southern Gulf Islands can be busy. Buyers may have come in late Spring/Summer to “look”, but they often wait till Fall to offer.

People looking at properties on Salt Spring, right now, are seeking permanent homes…they are not, in the main, looking for recreational options.

That’s actually a change. In previous years (up to the economic meltdowns of late 2008), we saw many Albertans & U.S. buyers on Salt Spring and the Southern Gulf Islands. These were recreational buyers…this was not their primary residence.

Post-recovery (mid 2016), the main buyer profile became a Vancouver buyer…who had sold in their venue for large dollars. They were seeking a destination to move to…they were not recreational buyers.

So….in seeking that “forever” destination, Salt Spring garnered competition: Sooke/Metchosin, South Cowichan, Courtenay/Comox…hmm…why your area? Why not theirs? Good question!

Islands Trust

On Salt Spring, which is a part of the provincial government mandated Islands Trust (in place since 1974), one understands that development is “capped”. What you buy is what you get. There will not be myriad new subdivisions opening up. A cap on growth also delivers (over time) an increase in valuations: low supply & generally high buyer demand does, in the end, result in price escalation.

Salt Spring offers a hospital, great ferry connections (three ferries with year-round schedules: one to Vancouver, one to Victoria, & one to mid-Vancouver Island), year-round regular sked floatplane services (to Vancouver Airport, to downtown Vancouver, to Seattle, to Maple Bay on Vancouver Island), 3 elementary, a Middle School, a state of the art Senior School, plus indoor pool, plus Arts Centre (ArtSpring), plus alternative health opportunities, plus a strong artistic/cultural base, and…the list goes on. Salt Spring is an eclectic and vibrant Island, with a year round lifestyle.

The real estate market on a Gulf Island, including on Salt Spring Island, is always dependent on outcomes in the areas that generate the buyers. Since mid-2016, that has been a Vancouver buyer.

The current provincial government has purposefully been making taxation decisions that will suppress a real estate market. Their intention was to cool the market in Vancouver, and also in Victoria, Nanaimo, Kelowna. Their measures have worked…sales have softened in Vancouver. As a recipient market, dependent on non-local buyers, Salt Spring may feel the effect of this suppression. It may take longer to achieve a sale and prices may reduce.

Kinder, Gentler Lifestyle

That said, there is a huge desire for Vancouver residents to leave the city and Salt Spring is one of the locations they consider. Perhaps the Vancouver potentials will simply end up accepting the prohibitive tax measures in their area, and decide to just get on with things. That strong desire to live a kinder, gentler lifestyle may continue to uphold the Salt Spring and Gulf Islands markets.

At this moment in time, early October, listing inventory remains thin and buyer desire remains high. Over half of the Salt Spring listings are priced over one million. A very thin residential inventory available below 900,000. Hmmm…. To remain in the entry level pricing category, a buyer might be best served by purchasing undeveloped land and building a cottage or studio. It is a struggle to find a residential property, below 750,000, that does not need serious renovation work.

Meantime, in this era of consistent and constant change, it is a gift to visit Salt Spring and the Gulf Islands…to experience a lifestyle rooted in 1974 (the year the Islands Trust was created, by the provincial government). If one can also consider living here, one immediately understands that all the necessities of a 21st Century experience are available…though wrapped in the charm of 1974. Fall is a superb season to discover the Gulf Islands.