Market Report

There are four distinctly different Salt Spring Real Estate markets:

$900k plus Salt Spring Real Estate market stats

$500k-$899k Salt Spring Real Estate market stats

Up to $500k Salt Spring Real Estate market stats

Land Salt Spring Real Estate market stats

Each market seems to move at its own rhythm.   Pareto’s Principle, the 80 -20 rule, applies to Salt Spring real estate.  I find that only 20% of the homes in each category are in perfect, updated, mint, move-in shape.  80% of the homes for sale could be classified as project homes.   However, most people do not move to Salt Spring to take on a large renovation.

Salt Spring Island real estate was a buyers’ market from late 2008 until spring/summer of 2015.  Some sellers have lowered their prices to reflect the large number of listings and sold during this slow period thus bringing the prices down.   The low of the market was probably 2012/13.  In 2015 the low Canadian dollar made many Canadian buyers look for deals in Canada and brought many foreign buyers to Salt Spring Island.   Some of the foreign buyers were from China, UK and the USA.  It seems as if the Chinese buyers were looking for larger commercial type holdings such as the North End Spa, Seabreeze motel and Ganges Campground to name a few.   The UK and USA buyers seemed to be looking for marque signature waterfront homes.  Another newer group of buyers moving to Salt Spring are younger families who main source of income is working on line.   This seems to be a growing trend on the island with so many moving away from Vancouver and the high cost and all looking for a small town/rural environment to raise their families.   The main reason this is happening is SHAW Cable company has invested millions on Salt Spring bringing high speed cable to almost all homes.   The young families are buying up the low end homes.

The odd thing that happened in 2015 was that North Salt Spring Water district (NSSWD) wanted to raise the level of the weir on St Mary lake to add capacity to the lake.  There are numerous property owners around the lake that stand to lose land due to the flooding of the lake.   To put pressure on the property owners NSSWD really played up the dry summer and then imposed a sweeping policy of “no more hook ups” to the water district.  Even lot owners who had been paying the water tax every year for years and years could not get a water hook up.  This “no more hook ups” policy basically made about half the lots for sale unsaleable.   Who would buy a lot that has a water line in front of it and is charged a water tax but can not hook up to the water line?  Shortage or implied shortages make for a scarcity and when that happens prices go up.   So land prices have been affected by the policy of the water district but despite that 2016 was a record year for land sales with 70 lots selling.

In total there were 328 properties sell on the Victoria Real Estate board in 2016.  Plus 27 posted as sold on VREB for a total of 355 properties exceeding the 2007 record of 307 properties.
Here are a few graphs that show the market trend for the last few years;

 

Historic listings

data historic price trends

 

graph historic price trends

Selling price to list ratio

This year the sellers are going to be confident their home will sell if it’s in great clean and in great shape.   Sad news for the buyers the year of the low ball offer was 2012/13.  The market has changed and it seems as if it’s going to keep trending up.

Real estate is a predictable market.  With some degree of certainty I reasonably predict that 2017 will see a market that goes sideways with small price increases and the prices are generally slowly trending up.  It really comes down to the basics: location, state of home and price.  Most homes that will sell in 2017 will have great locations, will be staged perfectly and will be priced comparable to the sold homes.

Obviously I like nice homes that represent real value (i.e. location, state of home and price).  By now you have probably also surmised that I dislike overpriced, poorly turned out homes.  They do nothing more than clutter the market.  Pareto’s 80-20 rule works so well when you look at Salt Spring real estate.  80% of the homes for sale need lots of work and approx 20% are stunning, updated homes in mint shape, and ready for you to move into.  These fine homes are in short supply, yet these are the ones that 80% of the buyers want.  They will sell fast and some will have multiple offers.  The not-so-nice homes will sit and sit, then be re-listed over and over and finally, when the owners realize their home is overpriced, they will be reduced and sell at a discounted price.

If you are into fixer uppers there is no shortage.  One could say there is a life time supply.  To buy a fixer upper one has to get an amazing deal or it is not worth the time and energy.   As a general rule, double all the expected costs of doing a reno on Salt Spring.  And remember the basic Salt Spring real estate rules to follow:  Sunny location, water view, no road noise.

A complete year-to-year price history of sold homes on Salt Spring  is available.  (Note: email Scott scottonepercent-web@yahoo.com for a password to this page).

Good luck and make sure you buy your new Salt Spring home wisely.  If you really want to get a deal, please check out the Advanced Search here.

Here is the BC wide sales states compiled by the (BCREA) British Columbia Real Estate Association.  It is clear that what happens in BC transpires to what happens on Salt Spring.  If real estate in BC is booming Salt Spring will be booming.

Here is the detailed break down about the BC real estate stats by the BCREA; bc homes sales stats 2016

Cheers

Scott Simmons

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