Tag Archives: salt spring island

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.

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…

November 2013, Market Analysis

November, 2013.

Drummond Park

Drummond Park, Salt Spring Island, BC

Change is the mantra of our times…doesn’t matter what is under discussion.

The Internet & its very broad brush, erasing past scripts so new responses can emerge, just continues its message of shift.

Nothing escapes it.

All business models are affected & real estate is no exception. A consumer in charge, & a search rhythm that channels information gathering, are just two aspects of change.

Big picture societal shifts are also well underway.

Is the age of jobs over? If it’s a technology time, then disappearing traditional jobs may never reappear. Is the education system set up to train the engineers & programmers now needed?

One reads think-tank pieces about the hollowing out of the middle class, with fewer people doing well financially & more sliding into lower levels. Is retraining the answer?

Perhaps our time has more in common with the beginning days of the Industrial Revolution…the older Agrarian world was erasing. For a time, the old & the new co-existed…then the wealth tied to land was replaced by wealth from trade & the globalization of Empire.

It must have been a painful shift for those on the Agrarian/land side, & very exciting for those inventing what we now call the Industrial Age. It was a revolution, as it changed a way of thinking about life & one’s place in a social fabric. Dissolution and opportunity, all at the same time. Sound familiar?

Styles of living, with an aging population, are also something to be considering.

A couple of years ago, I wondered, on my radio show, if the boomers would reinvent aging the way they reconfigured childhood & early adulthood…thinking that those who once loved the group/commune life might also enjoy a personal pod space with a community cooking/meeting area.

Just read in a recent Time article that this concept of the tiny home, in a “village” layout, with a communal lodge nearby, is being successfully developed in Texas & in Oregon. One future option for that last third of a life span? Is this a concept that would suit a Gulf Island retirement concept? As Aristotle reminds us, we are a social animal. Isolation is not good for us.

Hmmm…a global village (thank you, Marshall McLuhan, for your imagineering in the 1970s), with a flattening of boundaries due to the multinational culture. A method of communication, the Internet, that furthers a no geographical boundaries world…at the same time that it’s erasing the concept of individual privacy and the idea that the personal & the corporate are separate entities.

Wow…a lot for the remaining hybrid beings (with memory of a pre-Internet world & a knowledge of the post-Internet one) to cope with? Doesn’t matter…the post-Internet beings treat it all like wallpaper…which it is, of course. Important to be in the “now”, always.

So: real estate markets follow cycles, like any market & consumer-driven item. This may be a natural recovery underway, then…year 9 of a 10 year cycle. Plus, societal shifts may be creating a safe-haven seeking…to preserve capital & to seek a level of self-sufficiency. Fear as a motivator! Certainly, for the first time in a 5 to 6 year downturn, in all secondary home/discretionary/recreational regions, there is evidence of a slow uptick.

The ways of connecting a buyer with a seller, however, have dramatically changed…especially in a discretionary region. What does this mean for you? Call me.

On these Gulf Islands/on Salt Spring Island and on Vancouver Island the activity, since early 2012, has been mainly in the entry-level residential segment…up to $700,000, say. Perhaps investor-buyers, seeking tenants/passive income stream? Maybe end-users, seeing the huge value in a recreational purchase after an almost 6 year flat time? Sellers are highly motivated & prices have reduced around 35% since 2007…it might be the last stages of a buyers market, & finally the secondary home regions are seeing this buoyancy, too.

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.