Tag Archives: vancouver island

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.

August 2013, Market Analysis

August 2013, Market Analysis

An improving real estate sales trend continues to slowly build into place, on Salt Spring & the Southern Gulf Islands. The same improvement in sales is occurring on Vancouver Island…it’s a secondary home marketplace uptick, then. Prices still remain volatile.

Word from south of the border is that all those hard hit areas (Florida, Arizona, California, etc) have been experiencing a significant uptick in both sales volume and in price points. Inventory levels have been reducing. This encouraging stats report from the U.S. is now encompassing the secondary home/discretionary markets (Vail, Aspen, Tahoe, et al), not just primary residence areas.
Blue Sky
Very recently, the upper tier priced properties in the recreational marketplaces, also in the U.S., have been finding significant buyers/sale pricings. This secondary home recovery is good news for all “by choice” destination locations, and that would include the Gulf Islands.

It’s important to pay attention to this significant improvement in sales activity for our near neighbour…Canada does track events and outcomes in the U.S. It’s about general consumer confidence.

In our post-Internet world, real estate is less regional in outcomes, particularly in the secondary home/recreational markets. The buyer profile in any discretionary marketplace tends not to be “local”.

The Internet has opened up the world as a potential buyer for any recreational based region, but it has also created a “pause” while that global buyer searches out all possible areas. No one wants to make a mistake…thus, the buyer takes time, searches out various locales, often returns two or three times to the places that caught attention…& then may finally “act”. Time truly is a component in all sales, then, in discretionary markets, regardless of market trend in play.

The Pacific Northwest Coast tends to be a tail of the dog location. Last up/last down/last back up…the uptick momentum is just now being felt.

At this midpoint in the year, it’s good to take a snapshot of outcomes.

On Salt Spring & the Southern Gulf Islands, this is also the beginning of what has evolved into our main sales window. Our market has truncated down to a mid-July to mid-November window…a late Summer/Fall market, then. Surprisingly, the Spring months are no longer as busy as in previous times. Perhaps the travel patterns of our tourist visitors have changed?

Tourism, in all recreational locations, drives other business outcomes. Someone visits Salt Spring or Galiano or Mayne, falls in love with that Island, then decides to call a realtor and to buy a property…then architects, contractors, excavator operators, septic installers, electricians, plumbers all get busy, too. Plus landscapers, gardeners, cleaners, soft furnishings providers, and so on. Resorts, B&Bs, hotel, motel, restaurants, retail stores…they are busy with tourist arrivals and also with residents and guests.

A recreational/retirement region depends on that tourism buoyancy to experience real estate volumes and then other ensuing business activity.

The past 5 to 6 years globally have been about economic suppression, and discretionary locations around the world saw plunging real estate values and business closures. No one “has to” buy a second or retirement or recreational property. An economic suppression means a real estate downturn, in secondary home environments.

So what might be driving this renewed interest in discretionary markets? Is it a safe haven investment move? A seeking to preserve capital? Perhaps….

Markets rise & fall…like waves on the ocean. In 2006 we began to fall down into the trough of a downturn…which became hugely evident in late 2008. Now we seem to be climbing up the other side of that wall of water. A recovery is not a straight line up…more like ladders between flat benchland. Up/flat/up/flat…takes time, then, for all property types and all price points, to see consistent uptick.

The good news: things are improving. The difficult news? It’s not a fast-track uptick. It may take until early spring 2014 to see consistent uptrend in the secondary home marketplace, and it may take until summer/fall of 2014 to see uptick in undeveloped land, commercial, and upper tier priced residential sales.

We are so lucky to be owners on Salt Spring Island or on another Southern Gulf Island. Buyers seeking what we own will also be very lucky.

July 2013, Market Analysis

Secondary Home Market’s Afoot?

I found it very interesting to read a June release forecast, on the summer season sales projection, for secondary home markets…from a major real estate franchise in Canada.

A client phoned me up & read it to me…sounded just like one of my much earlier monthly market analyses or some of my various daily blog reports! Check out some of my past thoughts.

I have been projecting, since last August, that it would take until July this year to see a resurgence of interest in secondary home/discretionary regions. I think I am being proved right, & I am not a clairvoyant.

These “by choice” resort-based areas have been “flat”, globally, since mid-2007. Now, movement is afoot! No one can force a market…it has a natural cyclic rhythm. Now, it is with us.

No one “has to” purchase a second home

No one “has to” purchase a second home or retire in any particular timeframe or choose a recreational parcel…such purchasing decisions can be put on hold.

Consumer confidence is the key to secondary home market activity.

Can also be a market movement propelled by fear, though…in this case, might be a concern about currency validity and the preservation of capital…& perhaps even a desire for a safe haven, to be self-sufficient.

For whatever reason this action has started, this report notes that prices have been substantially reduced between 2009 & current date, in secondary home marketplaces, and so the properties selling are perceived to be hugely undervalued. Foreign buyers are apparently a large proportion of the purchasers.

A return to hard asset investments (& real estate, though not liquid, is a big item here) is clearly on the radar.

The Islands Trust

Salt Spring Island & the Gulf Islands are under the jurisdiction of the provincial government’s Islands Trust. This Trust has been in place since 1974, & it severely controls growth through strict land use/density bylaws. Call me, for more information on this.

When one has a growth-controlled model in place, a government mandated body with a “preserve & protect” guideline, and in an area of beauty, soft climate, great protected boating waters, close to major centres and yet beautifully “apart”, one also has the potential to become a global destination for those seeking amenities plus a safe haven lifestyle. What did economics 101 teach? Supply & demand? Hmmm….

I think we will see a strong clearing out of inventory over our season (which has shrunk to July/August/September/October now), with prices remaining volatile. As inventory clears out, though, stability in pricing will follow…will we see substantial price increases by early 2014? Perhaps….

It’s important to me that you enjoy a successful real estate experience on Salt Spring Island, on a Gulf Island, and on Vancouver Island…for all your real estate needs, please call me…discover the difference!

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!

February 2013, Market Analysis, Salt Spring

Did you know?

Salt Spring Island has a hospital, plus extensive seniors oriented opportunities. A superb retirement lifestyle is available.

It has 3 elementary, one middle, & a state of the art senior secondary school. There is a private school on island, too. A great family oriented lifestyle can be found here.

Salt Spring also offers a theatre (ArtSpring), an indoor pool, and a brand new library resource centre in the heart of Ganges Village.

Two marinas, a Sailing Club with private dockage, plus 8 lakes (4 of them open to the public for swimming, sailing…no power motors allowed on the lakes).

Lovely beaches, easy access for beachcombing, swimming, kayaking, sailing…and always that alluring environmental beauty, preserved by the Islands Trust (the form of governance on the Gulf Islands).

Parks, hiking/walking opportunities (clubs to get involved with, if desired), plus a vibrant arts based economy (galleries, studio tours, artisan markets & craft fairs).

The 10K diet is alive and well…farmers markets, farmgate stalls where you pick up free range eggs and garden produce & leave the money for same (the honour system works here). Vineyards that produce award-winning wines…the islands are similar to conditions in the Loire Valley, in France.

3 ferries (from Vancouver Island, Victoria, & mid-Vancouver Island), plus 3 floatplane companies (regular skeds out of Vancouver downtown & airport, from Vancouver Island’s Maple Bay, & from Victoria’s airport) with year round service, and with seasonal service from Kenmore Air out of Seattle…very easy to come & go from Salt Spring!

Nothing is absolutely perfect, ever, but Salt Spring Island and the Canadian Gulf Islands come close!

The micro-climate is only one part of the charm of these special islands. Growth is curtailed by the stringent zoning/bylaws of the Islands Trust, in place since 1974. This lower rate of development, & subsequent smaller inventory of properties, can keep prices somewhat higher than an equivalent property on Vancouver Island, for example, where growth occurs more readily.

More info and details on how you can be a part of the Island lifestyle? Call me!

The Market

The real estate market is always a cyclical rhythm…between 2002 and 2005, sales volume on Salt Spring apparently rose by 50% and pricing by around 60%.

The economic slowdown showed up in secondary home/discretionary marketplaces, including on the Gulf Islands, by mid-2007.

The global economic meltdowns of late 2008 left no one exempt.

Between 2009 and 2011, sales in discretionary markets were very slow and conditions remained flat on Salt Spring and the Gulf Islands.

The first half of 2012 in secondary home markets saw sales rise in entry level residential options…volume in this specific segment saw a rise of around 30% on Salt Spring, but prices remained highly volatile/unstable…price reductions of a very substantial nature took place throughout a listing period, in all property types, and another reduction usually occurred at the point of any offer, regardless.

In the last weeks of 2012, some upper tier priced residential offerings on Salt Spring found buyers…with the same substantial price reduction dance en route and a further reduction at the point of the offer.

Prices may have suppressed on Salt Spring and the Gulf Islands by around 35%, between late 2008 and mid-2012, according to some appraisers. In many properties, this drop in market value is mirrored by a reduction in 2013 government property tax assessments (the government looks at sales from the previous year).

Sales of undeveloped land and commercial/business options and cottage/recreational offerings all still remain very flat in secondary home regions. That reluctant buyer profile has not yet decided to invest in raw land opportunities, perhaps.

Projections are calling for a stronger real estate market in 2013, with all property types and price ranges forecast to see an uptick in activity. For Salt Spring and the Gulf Islands, it may take until the summer/fall market to see strength in sales volume. As inventory thins, prices will stabilize. Will the first part of 2013 thus signal the end of buyers market conditions? Possibly….