Tag Archives: Salt Spring Island Real Estate

Market Analysis, February 2018, Salt Spring Island

Year of The Dog

Year of The Dog

February 2018, Salt Spring

February holds early Spring. Longer days, with many sun days between storms, remind us that we are facing forward to the promises of summer.

Real estate patterns in January/February are often a continuation of November/December of the previous year. It may take until later in March to catch the real tone of 2018.

What we can see: a continuing attrition in inventory. Offers are often at full list price. Back-up offers are made, in hopes that a first offer will collapse. Very few new listings are expected to come onstream, and those that do are setting new price levels. Will the summer/fall market achieve sales at these new levels?

Seller’s Market

It has become a seller’s market. Low inventory plus higher buyer demand does evolve into an uptick in prices.

New parameters as to how real estate will be done in B.C. are being worked out…new rules, new contract forms will be law by March 15th. Please call me re these very significant upcoming changes. At the moment, it remains business as usual.

Two different groups have formed after the “no to incorporation” vote on September 9, 2017. None of the many inadequacies facing Salt Spring can be addressed by the current 1974 form of governance.

It’s perhaps unfortunate that the “yes” side did not make it clear that the Trust would always remain (it applies to all Gulf Islands) and that two trustees would still continue to be elected at civic election time.

If the vote were a “YES”

What would have happened with a “yes” vote: appointed planners, many not local, appointed from Victoria, would have been replaced by elected (and thus accountable) local council members. They would have dealt with specifically Salt Spring concerns: water moratorium that prohibits construction of approved affordable housing projects is only one such item. It may not be possible to make changes within the current system. Keep informed.

Year of the Dog

2018 is the Year of the Dog in the interesting Chinese astrological system…which starts with their Lunar New Year this month. Dogs are loyal, but also protective. Hmmm….

It may be that 2018 is also the beginning of the “real 21st Century”. Often, the first 15 to 20 years of a new century have a mix of previous and new societal trends.

Now, with a post-Internet world in place, we are seeing outcomes and acceptance of artificial intelligence, robotics, smart homes, smart appliances, 3-D printers, sharing economies, online consumerism, connectivity between devices, crypto-currencies, accepted knowledge being replaced within 18 months…these are societal altering issues…and McLuhan’s “global village”, described in the 1970s, is with us. Hmmm…

Perhaps the chaos of continual change is what makes Salt Spring and the Gulf Islands so appealing? Perhaps being encased in 1974 is a good idea?

With proximity and ease of travel to major centres, so one is not isolated, coupled with a no-growth governance policy that is imposed on the Islands, date-stamped 1974, this allows for a suggestion of a yesteryear experience?

Salt Spring does offer an authentic artists community. It does offer an experience of the natural world and does encourage small sustainable farming and also alternative health opportunities.

Does this sound a bit like a retro-70s moment? Perhaps Salt Spring needs to run with “what is”…and deliver to visitors that organic feel of how life used to be? Hmmm….

Meantime, always limited inventory (due to the Trust’s mandate, created in 1974, to preserve and protect the environmental beauties of the Gulf Islands, for the benefit of all B.C. residents), plus renewed buyer desire for Salt Spring, and a lack of available inventory to satisfy that demand…yes, we begin February with a seller’s market. Price escalation may follow.

There is always opportunity, no matter the market trend in play….

Market Analysis, January 2018, Salt Spring Island

January 2018, Salt Spring

Discover Yourself Here

January takes its name from the ancient Roman god Janus…he is depicted with two faces…one looking back and one looking forward. It’s a good image for this very beginning time of a New Year.

I often think that Salt Spring’s real estate market rhythm falls into thirds…and that November to February is one such third. The latter part of a year does seem to be continued into the early part of the next year…that Janus motif, perhaps.

2017 ended with an exceptionally low listing inventory, in both residential and in undeveloped land opportunities. Thin inventory does usually forecast price rises, and two new listings in the final weeks of last year did seem to point the way to higher price points.

New Mortgage Rules

New mortgage rules in Canada may make it more difficult for first time buyers to become home owners. For a buyer, it may make sense to connect with a mortgage broker…they can access many lenders and may be able to deliver concepts not readily available at the “big 5” banks.

One concern…these new mortgage stress test rules may mean fewer starter buyers overall, across Canada, but this may also have the effect of causing another secondary home market “pause”…first time buyers in a city might be buying from retirees…who then might retire to Salt Spring or Vancouver Island communities…is this a potential 2018 version of the August 2016 metro-Vancouver offshore purchase tax, which did affect the discretionary markets? In the main, those Vancouver sellers have become our buyers.

The Year of The Dog

In Chinese astrology, 2018 is known as the Year of the Dog…it begins the Chinese New Year, at their lunar festival. The dog is recognized as a faithful and protective character. Perhaps this loyal and protective aspect will make 2018 a more peaceful year?

Completed sales in January are often based on action in the late Fall, and so do not necessarily show a new market trend. The Spring Market usually begins by March Break, and it can take till April to truly see a market pattern in this secondary home/discretionary marketplace.

October 2018 is also a civic election year. On Salt Spring, two trustees (Islands Trust) and one CRD (Capital Regional District) director will be elected.

The September 9, 2017 incorporation vote on Salt Spring, voting 63% in favour of retaining the governance status quo, which has been in place since 1974, means that some key issues (affordable housing, lack of work rental, water moratorium, unfinished Boardwalk) remain unaddressed. As 2018 unfolds, those running for the three elected positions will be heard from. It would be good to introduce 1974 to 2018.

Another change in 2018 will involve the Real Estate Services Act of B.C. By March 15th, there will be substantial changes to how real estate is done in B.C. Ask me for details.

The Internet and its continuing evolution will also have impacts on the real estate industry. How is social media changing realtor/client interactions? What will be the role of a realtor, going forward?

So…industry changes and Internet game-changers and market uptick…marking 2018 as a very 21st century year (all about change).

I do these market reports at the beginning of each month, and updates as a month progresses are done on my weekly blogs.

There is always opportunity, no matter the market trend in play, at any given moment.

Salt Spring and the Southern Gulf Islands offer a pleasing lifestyle in a scenically beautiful area, with proximity to major centres.

That Trust “preserve and protect” mandate has brought forth a community that encourages creativity…Salt Spring is an authentic artists community.

“Discover Yourself Here” is the promotion tag line used by the Salt Spring Chamber of Commerce and it does speak to the opportunities offered on these Gulf Islands.

For a glimpse into some aspects of Salt Spring’s world, check out the Food Network’s Chuck and Danny’s Road Trip (find it on YouTube)…it highlights the foodie paradise of this Island’s microclimate, and catches the charm of Salt Spring. Another glimpse of Salt Spring is currently on Knowledge Network (Island Diaries)…done by the group behind Waterfront Cities of the World, they chose Salt Spring as one of the global islands to be highlighted. Interesting….

I look forward to meeting with you and to helping you to accomplish your Salt Spring Island and Gulf Islands real estate goals. Your best interests are always my motivation.

A New Year is a time for new beginnings and new ideas. Let’s put our faces looking forward.

Wishing you the best in this New Year!

Market Analysis, July 2017, Salt Spring Island

July 2017

July begins our main season…both for tourism/visitor experiences and for real estate discoveries and sales.

In a way, Salt Spring Island is seasonless. People turn up at any time, and real estate sales occur in December and January as well as in August and September.

Salt Spring Island

Salt Spring Island


The Pacific Northwest Coast, though, does seem to call forth most activity and arrivals in the late summer/early fall time. Although gardens spill over into spring beauty in April/May/early June, the arrivals time for serious property seekers has evolved into that mid-July to end of October timeline.

Since mid-March, 2016, and even with interruptions from city off-shore tax ramifications and results of “real winter” (added up to 7 months of “pause”), we began to recover from that 8 year global economic downturn…and we have now arrived at an authentic seller’s market.

The classic definition of a seller’s market: low inventory plus high buyer demand. The outcome of a seller’s market: price increases.

That said, there are always opportunities for a buyer.

To own property on a Gulf Island, including on Salt Spring Island, is a long-term and enviable asset.

In 1974, the provincial government created the Islands Trust. It’s mandate: to preserve & protect the environmental beauties of the Gulf Islands, for the benefit of all B.C. residents. Through strict zoning/bylaws, the Trust effectively capped growth.

A limited inventory, both structurally and by market forces, does predict an escalation of prices, over time.

These early days of recovery in the real estate sector have seen most of the sales activity in the entry level priced properties. It may be that this action will now start to be seen in the mid-range to the upper tier priced options. What is also interesting, at this point: undeveloped land options have also seen sales action. A market recovery does always begin with sales in the entry level residential segment. As inventory thins, land options and a building project are considered.

July and August are key months for all businesses in our rural/recreational region…tourism is the main industry in the Gulf Islands. A successful visitor experience can result in a real estate sale.

Looking to sell? This may be an optimum time to consider listing your property. Low inventory coupled with buyer demand does favour a seller. Prices have stabilized. In many cases, properties are selling at list prices. In a few instances, if a property is unique and there are no comparables, there are small bidding wars. There are often back-up offers, due to lack of supply. That said, the buyers are, in the main, not “local”. They are looking in other coastal communities, too. Salt Spring has competition as a destination for a buyer. All sellers need to treat offers with respect. The Gulf Islands are discretionary/”by choice” areas.

Seeking to buy? A creative approach can often keep a property purchase at budget. It’s important, though, in an offer moment, that one puts in one’s “highest & best” offer response. A seller’s market means that the negotiating window that buyers enjoyed, two years ago, has been erased. There is competition from other buyers now. More information, on how to enjoy a successful property purchase, as a buyer? Call me!

There is always opportunity, regardless of a market trend in play at any specific time.

Market Analysis, June 2017, Salt Spring Island

Restaurant For Salt, Salt Spring Island

June 2017

The interest in all secondary home/recreational markets continues…on Vancouver Island, on the Sunshine Coast, and on the Gulf Islands.

Salt Spring Island remains a sought-after destination…it is a “stand alone” community, with a year-round lifestyle opportunity, and is very attractive to those seeking more than just a “summer place”.

Salt Spring offers a hospital and good related health segment. There are three elementary schools, a middle and a senior school. There is an indoor pool, an arts centre (ArtSpring), a modern Library/Resource Centre, and myriad park hiking/walking trails to explore. In the heart of some of the best protected boating waters in the world, Salt Spring Island is beautifully sited in the Salish Sea.

Salt Spring Island, Skywater

Salt Spring Island, Skywater

B.C. residents) effectively capped growth on all the Gulf Islands. This control of growth, via strict zoning/density bylaws, has preserved a lovely yesteryear ambiance…yet all that is required for an optimum 21st Century lifestyle is immediately at hand, on Salt Spring Island.

With a micro-climate that supports vineyards, olive grove, orchards, small farm holdings, it is possible to enjoy a self-sufficient living choice.

The real estate market, though experiencing a fits and starts rhythm (offshore tax in Vancouver plus a once every twenty years burst of “real winter” caused significant pauses, approximately six months in total) in 2016…yet now, in retrospect, that 2016 year is showing itself as the sales volume increase year.

So far, in 2017, it continues to be about lack of inventory, continuing high buyer demand, and subsequent price stabilization…it may be that price increases will be a feature of the final 2017 market report.

A buyer’s market simply means lots of inventory and few buyers…prices remain suppressed. A seller’s market means little inventory, lots of buyers seeking property, and resulting buoyant pricings. It is always about supply and demand in a market driven industry.

June is an interesting month. A divide between winter-spring and summer-fall markets. Often quiet in the first three weeks, the serious “season” begins in that final week. July/August/September remain very active in sales, in all the secondary home/discretionary markets.

To date, from January 1 to close of May, the sales on Salt Spring are:

  • 10 between 159,000 and 199,500.
  • 12 between 200,000 and 299,000.
  • 18 between 305,000 and 396,000.
  • 22 between 400,000 and 487,000.
  • 17 between 500,000 and 599,000.
  • 9 between 625,000 and 690,000.
  • 5 between 710,000 and 769,000.
  • 8 between 800,000 and 899,000.
  • 2 between 900,000 and 945,250.
  • 7 between 1,075,000 and 1,750,000.
  • 3 between 2,200,000 and 2,500,000.

The listing inventory (residential/lots-acreages/commercial) remains very “thin”. Although prices have not yet gone up, they have stabilized…in many cases, properties are selling at full list price. Back-up offers are in play and a very few have been in mini-bidding war territory.

The last half of the year will showcase the rhythm of sales for 2017. Am not sure when we went to a late summer/fall market for actual sales, but that is the current tone. People may view earlier…but they often act later. Hmmmm….

Market Analysis, December 2016, Salt Spring Island

A small geographic space with a world-sized heart…that’s a good description of Salt Spring Island and the Southern Gulf Islands.

Hastings House

Hastings House

The Islands Trust, created by the Provincial Government in 1974, with a mandate “to preserve and protect” the environmental beauties of the Gulf Islands, for the benefit of all B.C. residents, has effectively controlled growth on all the Islands via strict zoning/density bylaws.

Salt Spring Fire Department

Salt Spring Fire Department

If you go up in a floatplane, en route from Ganges Village on Salt Spring to Vancouver, you will see the large swathes of green on the Gulf Islands…a mix of provincial and federal park reserves, CRD park reserves, Conservancy protected lands, owner gifted or covenanted land…an amazing natural gift to visitors and residents alike. The Gulf Islands have all been preserved from unbridled development.

Important, though, in this non-municipal form of governance, that 1974 is paying attention to 2016. The big problem in cities and towns seems to revolve around affordable housing. This is a problem on Salt Spring, too.

There is a range of age-groups and affluence on Salt Spring…a broad spectrum of people desiring to live here. There are no work-rentals, no affordable buy-in living options, and very few choices for the aging boomers to move to, when downsizing. So…few starter homes, no rental apartments, few downsizing choices. Hmmm….

Salt Springers are being asked if they would like to become incorporated in a Gulf Islands Municipality structure. The two elected Trust people (two per island) & the Trust documents would remain in place. The day to day running of the island would be via an elected Council (one of whom would act as Mayor). Keep informed!

On Salt Spring, December brings craft fairs (WinterCraft at Mahon Hall, plus Fulford and Beaver Point Craft Fairs), seasonal theatre & choral events at ArtSpring, gallery openings, studio tours, light-up in Ganges Village, Christmas on Salt Spring events, pop up markets in the park…special menus in our superb restaurants. Seasonal delights await the visitor!

What about that real estate market?

And, what about that real estate market? As we close out 2016, one can look back and see an upticking market. After an 8 year downturn in the secondary home coastal markets (Sunshine Coast, Victoria, Vancouver Island, Gulf Islands), Salt Spring finally saw a shift into a dramatic sales volume increase between mid-March and the end of July. Buyers were mainly from Vancouver.

The unexpected and sudden government 15% tax for purchases by off-shore buyers, in metro-Vancouver, at the beginning of August, created a “pause” in all the secondary home coastal marketplaces…those sellers in Vancouver’s “hot market” had been the buyers in all the “by choice” regions. On Salt Spring, we “lost” August/September/early October. Then, around mid-October, things began to become busy once again.

The bulk of sales remain to a Vancouver buyer. Slowly, we are seeing renewed interest from Ontario. We may start to see sales from U.S. buyers…our low Canadian $ against the U.S. currency makes a real estate purchase here an interesting investment.

So many unknowables in the world: currency instability? Inflation/deflation? Equities or hard asset investment? Shifts in government? The impact of the post-Internet world just rolling on….

Change is the mantra of our immediate time.

Part of that: Boomers and Millennials. Different strokes for different folks. Important to understand the remarkably different ideas between these two significant demographics.

Stay tuned as well for the continuing changes to the real estate industry. Post-Internet dynamics change established models.

Salt Spring Island and the Gulf Islands are “by choice”/discretionary regions. The buyer has to first choose the specific Island…and then decide for the actual property on that particular Island. Time is a component of sales in all such secondary home/recreational areas…regardless of market trend in play.

Although it’s recent that sales volume increased (mid-March after 8 years of “flat”), prices have not yet increased. Stabilized, yes…and some properties have been selling for list price. Inventory is “thin”.

The 2017 real estate market kicks in here by mid-February. That’s just around the corner. At this time of year, some transactions will complete in January…perhaps for tax reasons. The process will have begun in this calendar year, though.

So…as we close 2016: strongest sales rhythm since 2006…very low inventory…price stability & sales at list price…all auguring for further improvement in the secondary home markets in 2017. The temperate climate and that slightly “apart” security of the Gulf Islands is also of appeal.

Market Analysis, July 2016, Salt Spring Island

‘Tis The Season!

July is the mid-point in our year and is also the beginning of our “real season” in real estate showings and subsequent sales. Salt Spring and the Gulf Islands, and many of the Vancouver Island communities, are secondary home markets. They are busiest between July and October.

salt

Secondary home/recreational areas do not follow the sales rhythms of primary residence/city regions. Thus, although eventually propelling activity in discretionary areas, Vancouver and Victoria real estate outcomes are quite different from those on Salt Spring or Mayne or Gabriola or in Parksville.

The huge sales volume in Vancouver, with resulting price increases, appears to now be mirrored in some parts of Victoria. That kind of sales frenzy is never the outcome on a Gulf Island or on Vancouver Island…the Islands are “by choice”/discretionary areas. By choice, I will buy on Salt Spring…by choice, I’m moving to Pender…by choice, I’m considering Qualicum…and so on.

What does this mean for a seller in these secondary home regions?

It’s become essential to have maintained one’s property.

It may be that all those popular HGTV style home shows have created a buyer who expects things to be “done”. Buyers do not want to call in a contractor…they are not looking for a fixer upper or a handyman special. If one has that kind of deferred maintenance property to sell, it may be necessary to come to market with a severely below market price tag. It’s interesting, this lack of buyer desire for a property needing “work”.

A new roof, a new deck, a septic system in good order, a well with water treatment system in place…these are now considered essentials. Interior items? Kitchens and bathrooms remain the two key components that will attract a buyer’s interest. Next would be flooring choices. Home ownership does bring with it consistent maintenance care. Renovations to update an older more dated home are often required.

Stiff Competition Remains

In our global post-Internet world, all secondary home areas are in competition with each other. It’s not just about a Salt Spring property being in competition with another Salt Spring home. A Salt Spring property is now competing for a buyer’s attention with a home on Galiano or on Thetis or in South Cowichan or in Parksville or in Courtenay/Comox…and also in Sidney or in Victoria. That means that a buyer also has to choose for the community itself, and not just a house in that location.

One thing that is of interest for any purchase on any Gulf Island: the form of governance has “capped” growth via strict zoning/density controls. The Islands Trust’s mandate (in place since 1974) is to preserve and protect the Gulf Islands. There is no opportunity then to see an explosion of growth on any Gulf Island.

On Salt Spring, as one drives about the Island, one is pretty well looking at “what is”. This retained beauty is important, but a cap on growth also leads to an escalation of prices, over time. Buyer interest coupled with low inventory of properties does lead to price stability and price rises.

The past downturn in all secondary home markets, and globally so, has eased or ended. It was a long eight year downturn. That lack of buyer interest did lead to lots of inventory and to lower prices. This is apparently now over.

Sales volume has dramatically increased on Salt Spring and inventory has returned to low levels.

The same dynamic is in play on other Gulf Islands and on Vancouver Island.

The difference from previous times? That competition factor. A house in Qualicum is competing with one on Salt Spring which is competing with a property in Sidney…the playing field between locations has broadened.

This means that one has to sell Salt Spring itself, not just the property located there. Hmmm….another reason to shop local and so to ensure the continuing allure of Salt Spring Island? Interested in how to help to do this? Connect with the Chamber of Commerce and become a supporter of the entire community.

At this mid-point moment: between $300,000 and $750,000 price range, there are very few residential options left. Spring sales volume doubled and little new inventory came onstream. Low inventory plus renewed buyer interest leads to price increases.

Now, we are seeing interest in undeveloped land…with a view to putting up a modular or packaged home…or building a cottage and then the house. This scenario might allow one to remain at budget.

Slowly, we are seeing the upper tier priced residential offerings capturing interest. Inventory is also thin in that price point. There is renewed interest in commercial options.