cooling real estate market for 2019
Real estate sales dropped in January as the market continued to cool. For every month in 2018, sales numbers fell below the same month the previous year. The year ended with a 20 per cent decline in the number of sales compared with 2017.
The pattern of lower sales numbers continued in the first month of this year.
Buyers are holding off for a number of reasons including the introduction of the mortgage stress test this year and higher mortgage rates. Tougher mortgage lending rules have reduced the size of a loan buyers can qualify for by up to 25 per cent. So people have held off buying as they watch for prices to flatten.
Some buyers are re-evaluating their expectations and looking at condos and townhomes rather than single-family homes or just the opposite further outside the downtown core. Everyone is watching the market to see what conditions are like in spring.
In the region’s core, where prices are typically higher, the benchmark price was $847,800 last month. It was also down from December, which was $858,600. January’s benchmark was up by 0.9 per cent from January 2018, when it was $840,000.
Over the past few years, demand in Greater Victoria has outstripped supply, putting upward pressure on pricing.
This could signal a great time to buy.
CANADIAN HOME PRICES EXPECTED TO INCREASE BY 1.7 % IN 2019
The 2019 Victoria Housing Market Outlook suggests modest price increases are expected in 2019 and estimates the average sales price to increase by 1.7 %.
Canadians said higher interest rates have not affected their ability to get an affordable mortgage thus far. However, this is expected to change in 2019. Reduced foreign buyer activity has opened up more opportunity for local buyers in Greater Vancouver’s and Victoria’s condo market.
If sellers of older properties (5yrs or more) don’t alter their selling price the property may sit on the market for months at a time. The market is now swinging toward a “buyers” market with slow moving inventory – go ahead, make your offer.