Historically low inventory is having a major impact on home sales across Vancouver Island.
The Vancouver Island Real Estate Board is reporting a 15 percent dip in sales of single-family homes last month, compared to June.
In the condo apartment category, sales dropped by seven percent from June, however, row/townhouse sales rose by 29 percent month to month.
Making things challenging for both realtors and buyers is a major shortage of listings, which is having a domino effect on prices.
Board president Ian Mackay says it’s been an ongoing challenge.
“We’re just not seeing the inventory grow,” Mackay said. “We’re at a 20-year low, it’s kind of a classic supply-and-demand scenario where low supply, high demand, prices keep rising.”
Active listings of single-family homes and row/townhouses dropped by 51 percent from July 2020.
In the condo apartment category, inventory decreased by 60 percent from one year ago.
There could be a glimmer of hope ahead, with the B.C. Real Estate Association forecasting that market conditions may begin to even out somewhat by the end of the year.
However, it would take approximately 2,500 new listings in the VIREB area to create an actual balanced market if activity continues at this pace.
Mackay says B.C.’s real estate boards have been asking local governments for months to ease up on red tape and restrictions on new developments, in order to open up the market.
“Unless demand drops significantly or more housing supply comes online through new construction, the needle for VIREB’s inventory situation will not move by much,” he said.
“BCREA, VIREB, and other real estate boards continue advocating with policymakers at the provincial and regional levels to speed up the development process so that municipalities can expand supply more quickly to meet demand.”
Mackay adds that building more homes is not a quick solution, but VIREB believes it is the only one that will address the lack of affordable housing.
VIREB’s heated housing market continues to impact prices, which continue to increase throughout the board area.
The board-wide benchmark, or typical, price of a single-family home reached $732,700 in July, up 33 percent year over year and three percent from June.
In the apartment category, the benchmark price was four percent higher than the previous month and 24 percent higher year over year, reaching $380,700.
The benchmark price of a townhouse rose by 32 percent year over year and by three percent from June, climbing to $564,400.
In Campbell River, the benchmark price of a single-family home hit $639,100 in July, up by 33 percent from the previous year.
In the Comox Valley, the year-over-year benchmark price rose by 30 percent to $765,200.
The Cowichan Valley reported a benchmark price of $723,800, an increase of 32 percent from July 2020.
Nanaimo’s benchmark price rose by 31 percent, hitting $739,000, while the Parksville-Qualicum area saw its benchmark price increase by 34 percent to $850,100.
The cost of a benchmark single-family home in Port Alberni reached $488,100, a 47 percent year-over-year increase.
The benchmark price for the North Island also rose by 47 percent, hitting $384,200 in July.