Greater Victoria's Condominium Inventory Reviewed
Greater Victoria Real Estate Condominium Values
are (as many other products) affected by Supply and Demand for property in any Area and Property Type.
If you are considering to either sell or purchase a property in Greater Victoria now or in the future, developing a "battle plan" or "strategy" is just one more reason why it is essential to surround yourself with a team of Pfanntastic experts to assist you with your plans.
During times of change (as we are experiencing today) timing, preparation, understanding how every part of the home buying or selling process may affect your bottom line as well as your current or future lifestyle options becomes a very challenging journey that nobody should travel with out a good road map and tour guide. Please be sure to contact us so that we assist you in developing the perfect strategy for your personal situation and plans.
The information in this report is part of our efforts to educate current and future home buyers and or sellers with their personal real estate strategy.
We have all heard the statement that Real Estate is a "Supply and Demand Industry", okay, but how does that affect you, the Home Owner or Home Buyer wanting to buy or sell...
High Demand combined with Limited Supply causes prices to go up relatively quickly.
Low Demand combined with High Supply causes prices to go down relatively quickly.
As Increases or Decreases in demand for any property type in any of the Greater Victoria Communities affects the number of properties sold (or the lack of sales) these increases or decreases of the number of sales also impact the list to sale price spread and eventually the prices any property will sell for.
Typically supply and demand are influenced by a variety of local, regional, national, and international factors. From improving local economy to higher national interest rates, from the local weather to war at the other side of the world, each and every single event or issue can affect the Greater Victoria market conditions (shifts).
In addition supply can easily be influenced by new construction, (re) development of property and or change of land use by (re) zoning by laws. For example during the recent building boom we have seen how relatively quickly one can turn 3 to 6 older single family homes into a common 4 floor condominium building with up to 72 suites. During times of high demand, it is not uncommon for builder developers in neighboring communities to make application for rezoning and construction for 100's of suites to be ready for the market all within a relatively short period of time, and as such have a dramatic impact on local market conditions, which eventually will affect demand and sales......... and prices.
In order to review the current Condominium Market conditions of most areas in the Greater Victoria Market area, it is important to consistently review the current supply, the number of new listings entering the available inventory and actual sales volume of various property types are at any given time.
By reviewing the information below, it becomes clear that Greater Victoria still has some areas that truly have a significant oversupply of property, while other communities are showing signs of balancing its supply and demand, in addition a few areas that may have actually turned a corner based on their current inventory and sales numbers.
For example Vic West, North Saanich and Oak Bay, as well as to a lesser degree Esquimalt, View Royal, and Langford, show slow inventory absorption levels of 15, indefinite, 12, 9, 8 8 months respectively. The current inventory as well as the limited number of sales are a strong indication that further price adjustments will be needed in those areas before the absorption of current inventory will increase. This may take up to 24 months before real signs of recovery will become obvious for Condominiums in these specific areas. (although North Saanich has very few suites for sale, without any sales may be a very short term issue).
If you own property in the above communities and you are really serious about selling your property, it would likely be best to consider a very aggressive pricing strategy or offer considerable incentives. We have a few creative strategies that have generated substantial results for many of our clients, please contact us for details.
In a strange way, if you do not need or have to sell within the next 24 to 36 months, now would be a good time to actually remove your property from the market as this will in fact speed up the market recovery of your local market for Condominiums and in turn help your own cause in the future.
On the other hand, Victoria, Saanich East, Sooke, Sidney and Central Saanich are showing somewhat Balanced Absorption Levels and this indicates that sales prices are likely leveling off and show no reason for further drastic price adjustments (unless having been on the market for longer than average ( 45-60 days) time periods. Some minor adjustment in pricing, presentation and marketing may offer just the right solution for sellers.
The remaining areas (Saanich West, Colwood) are at Strong and Healthy Absorption levels. The current absorption levels for these areas indicate (at this moment) that prices may have bottomed out, and have possibly entered a recovery stage, that if sustained for the next 3 to 6 months these communities may see the first signs of moderate price increases for condominiums provided that surrounding communities are also seeing improved absorption levels.
Metchosin, Highlands, do not have any Condominiums currently for sale.
The Concept of Absorption rates represents the amount of time it would require to sell out the currently for sale inventory at the current number of sales per month. (current inventory/ Number of sales in 30 days).
Above we show the Current Greater Victoria Condominium Inventory and Sales Statistics, lets review traditional inventory and sales relationships.
- When we maintain approx 3 or fewer months of inventory we typically talk about a strong or potentially high inflationary market situation.
- When we maintain approx 4 to 7 months of inventory, we typically talk about a balanced to normal market situation.
- When we maintain over 7 months of inventory, we typically talk about a slow to very slow market place.
Locally there has been some perception that our local inventory and sales have been affected by an oversupply of newly constructed property, as such we are showing a break down of total, new and resale inventory. The information provided is compiled from the VREB MLS system available to Licensed Realtors. However our statistics do not include privately listed or sold property including inventory held by builders, developers and or private marketing companies, In some areas in and around Greater Victoria this privately listed and sold inventory can potentially have a substantial impact on local absorption rates.
As always, the information provided are general indications and may not affect any one property.
It is nearly impossible to predict or estimate when and or at what price point properties will bottom out. However given some of the information in this report combined with some of our earlier published sales to list price ratios and our Pfanntastic Real Estate Systems, one could develop a relatively reliable indication as to short to medium term property value and property sales direction. Peter and Linda Pfann can assist both home buyers as well as sellers to determine what strategy is in their respective best interest.