March 2025 – Market Analysis – Salt Spring Island

Wow…it’s meteorological Spring today, the first of March. This begins the seasonality that is treasured on the great Pacific Northwest Coast: early Spring, Spring, Summer, early Fall. March Break (mid-March) to Canadian Thanksgiving (mid-October) are key seasons for Salt Spring and the Gulf Islands.

Real Estate Market Trends

The islands real estate market continues to follow the trends of the past two plus years: lack of inventory and relatively stable pricing. The main buyer profile has continued to be a Vancouver/Lower Mainland purchaser.

The reasons for seeking a Gulf Islands/Salt Spring Island property are two-fold: one, a desire to leave urban for rural (to be self-sufficient). There also continues to be an interest in preservation of capital through a real estate purchase in a unique area…emphasizing a currency concern.

There is not a lot of choice for a buyer. Most owners are not wanting to be sellers. There is always opportunity, though, and some buyers may need to consider shared ownership models as a way into a market that rarely sees first time buyers.

Islands Trust

The outcome of the Islands Trust governance model (put in place in 1974, by the provincial government) was to cap growth through strict zoning/bylaws restrictions. It’s important for buyers to read about the Islands Trust online…to pay attention to those bylaws/zoning restrictions…and to also look at the Official Community Plan and to Development Permit Area restrictions. These can supersede the original bylaws. It’s important to understand the community “rules” before buying.

Current Listings

At the moment, there are approximately 95 listings (all property types…residential, land, commercial) on the MLS system. In a more balanced market, there would be around 380 listings. Lack of inventory remains the issue, and can lead to buyer hesitations.

2024 saw the beginning of many societal changes and 2025 appears to be continuing these shifts. It can be both alarming and energizing, when one encounters serious changes. We don’t get to choose our “time”, though…just our reaction to it.

The current referencing to potential U.S. reciprocal tariffs has reminded Canadians of their inability to trade between provinces. This is something that needs to be done. The lack of this has nothing to do with outside tariffs. It makes no sense to keep provinces isolated from each other, economically.

In B.C., business groups have recently come up with a plan to support economic pro-growth options. They point out that both provincially and federally there have been no-growth policies for at least a decade and that has nothing to do with outside tariffs either. Hmmmm……

The flexing of U.S. policies that emphasize that country’s outcomes could also benefit Canada’s rethink about our own dynamics. So many talented Canadians may have moved south in past years, as Canada did not offer the same opportunities. What were our governments doing?

The concern over the impact of proposed reciprocal tariffs, from our biggest trading partner, has brought forward many different “forecasts” about the economy, going forward. Real estate is one of the pillars of economic health in Canada, and the spectrum of current forecasts ranges from “we will continue to see slow growth” to “we will see a correction/downturn”. Many scenarios talk about a softening of sales and lowering of prices, with an improving trend in 2028.

These are the same people who were insisting that the covid shutdowns of early 2020 would cause a crash and then we ended late 2020/into 2021 with “over ask” bidding wars and an erasing of inventory…plus dramatic price increases.

Our lower dollar is attracting interested U.S. buyers…although the federal government ban on foreign buyers (brought in on January 1, 2023 and put in place until January 1, 2025…then extended till January 1, 2027) may be in place, there are many exemptions and it doesn’t apply to land or to commercial options. (The ban was brought in to help solve the lack of housing dilemma).

Lots to be concerned about…this month we will find out who will replace Trudeau and also whether there will be an early federal election. We will hear the budget from the provincial government and learn about their plan to create economic strength for B.C. The question of tariffs will be answered. And so forth and so on….. It is difficult to point to a trend at this exact moment. It may take until late April or mid-May to understand the tone of the 2025 market.

Meantime: it’s a good plan to take advantage of this seasonal awakening, to enjoy the beauties of the natural world that are erupting all around us, to remember to get out and about (beachcombing, hiking, picnics, tastings, al fresco dining, farmers markets, kayaking, art gallery openings, spa retreats, sailing adventures, theatre discoveries, and day trips to companion islands….in other words, to remember to live…and to simply and calmly breathe).

Opportunity always exists…we just need to be looking. And your thoughts are? Always welcome!

November… darker (end of Daylight Saving), post-harvest, thoughtful. Yes, it’s “fall back” time.

 

November 11th offers appreciation for those who served in wars past and those who serve today, to protect Canadians and their values, their lifestyles. Wear the poppy on Remembrance Day, in acknowledgement of sacrifices made.

Nature is wearing a more somber palette in November, as leaves drift from trees, and dark branches meet skylines. November speaks the tongue of grey…pewter seas, pearl clouds, charcoal forests, the metal hues of grey meshing with rain squalls that smear our vistas.

 

November…a time to light candles, investigate specialty soups, start to read a fat book, and remember to keep active.

Fall Market Trends

The real estate market? Oddly enough, the Fall Market can see a busier sales season. This has been the case in 2024, after an oddly quiet summer.

Often, buyers view properties earlier, and then they bring an offer later in the year. Sometimes, it’s about a hope that a seller will look favourably on an offer…the end of a year, the end of a season, and possibly a seller may just want to be out of the stress of selling. Sometimes that is the case.

 

Buyer Patterns and Market Dynamics

It can also be about the buyers rhythm…they know they want to leave urban for rural, but they have not decided on the “where”. Salt Spring and the Gulf Islands have competition from Vancouver Island communities, and buyers want to be sure of their decisions.

It takes time to visit areas and to make that choice of “where”. Until that is done, the “when” of a move is not in place.

Time lags are a factor in the rural secondary home markets. A buyer sees something interesting on the internet, then comes to view, then checks out other areas “to be sure” of initial impressions, then returns to seriously view available inventory in the acceptable price range, and then considers an outcome. This whole process can take several months.

Usually there are two and possibly three visits to an area. Fall is often when all the questions gel into answers and a buyer makes an offer.

 

There is no local market on the Gulf Islands and so visits are often widely spaced. It can take one to two years to sell a Gulf Island property. The outcome of this unknown offer timeline is that sellers respect buyers offers.

Since late 2020/2021, the inventory has been very low in most secondary home markets. Most owners do not want to be sellers. Sometimes, it’s because they can’t find a replacement property where they might move to. As something sells, little new comes on market to take its place.

The Gulf Islands are also under the Islands Trust form of governance, and that “preserve and protect” mandate (in place since 1974) controlled growth and maintained low inventory, beyond market forces. So, low inventory continues to be a factor at this very beginning of November.

In 2021, post-pandemic, there was a rush to seek safer, more self-sufficient areas (as in rural) to move to…”over ask” bidding wars became a feature. Inventory diminished. Prices rose. Generally, without further rises, prices have remained relatively stable since then. As the Bank of Canada has offered serious interest rate cuts in 2024, we may start to see some cautious buyers re-emerging. In 2022/23, buyers were reluctant to act. If seeking a move-in ready residential property below one million, then strata townhomes remain as the main option on Salt Spring…or else it’s undeveloped land and build.

The currency concerns (diminishing purchasing power of our Canadian Dollar) remain and buying real estate in unique areas is also seen as a preservation of capital decision. There have been some oceanfront sales in the two and three million range for residential this Fall, and this may reflect that investment buyer activity.

 

Mixed messages then, in 2024’s real estate market. Projections from “big box” companies are calling for an improving trend and busier sales, in 2025. It’s a difficult call to project into 2025, based on the haphazard 2024 patterns.

Interest rate cuts will have an effect, but it’s an unknown as to the degree of same. Are regular consumers still concerned about cost of living, of job security (what will be the real effect of AI?), of immigration pressures on housing, of continuing lack of housing? And so on…. Lots of questions and without serious answers the consumer may continue to rest on the sidelines.

Traditionally, though, lack of inventory and strong buyer desire do result in price escalation, and this trend remains in place at this very beginning of November.

 

Meantime, in spite of many concerns globally, and worries about election outcomes, the great Pacific Northwest Coast offers beauty at any season. November may sing the song of grey, but it also reminds us that it’s a month to allow us to step back into ourselves for a moment, to remember the fallow field opportunity (time to replenish our roots), and to enjoy the serenity of a quieter time. A little “mulling” never hurt anyone.

November: let’s pick a rainy day, meet a friend for lunch, watch the drizzle slide against windows, blurring the Harbour views… floatplanes chortling in and out, seal slithering past docks, boats straining at anchor, eagle hunched on a cedar branch, pondering…the amazing “wet coast” smiles hello.

It’s November. Enjoy!