With much fanfarethe lead business story last night and on the front page of the business section today was how the Victoria real estate market is in the deep freeze. Watching the news piece and reading the story, I might be forgiven for thinking that nothing but bad things are going on in our real estate market. Precipitous percentage drops in sales over last year, disastrously high inventory levels compared to last year, prices only going up slightly.
Wait a minute, what? Prices going up? But the news leaves me with the impression that you can't give your house away? Hmmm. Perhaps a slightly closer look.
For the umpteenth time, 2009 was a ridiculously big year in our market in terms of sales volume. Other than 2007 it was 20-30% bigger than any of the last 10 years. Using 2009 as a baseline metric with which to compare anything is simply stupid. Yes, TV news guy, stupid. Yes, Times Colonist news reporter, stupid.
The average sales volume in Victoria for the past 10 Octobers is just over 550 units. Take out the bumper 2007 and 2009 years and we get down to just over 515 units. This October is off the last 10 years by just under 20%, or less than 14% if you take out the huge years. For a market that's supposed to be in a mortal torpor, that's not bad. More importantly, prices continue to rise!
Inventory levels is a particularly irritating red herring, as in actual fact in many categories we have less than a six month level of inventory, which indicates a balanced market rather than a buyer's market.
For the Victoria home buyer - get out there and take advantage of the "bad news" - there are great deals to be had but the market looks to be turning the corner. Or wait until the busier, more expensive, less choice and less time spring market. Most lemmings do.
For the Victoria home seller - evaluate your need to sell and price accordingly - it is still very competitive - as it should be - and you need to be among the best in class to successfully sell your home. Or wait. For whatever reason, more people want on the bus when it starts to get crowded.
As always, get an expert on your side and please, learn to dig a little deeper!