The benchmark price for a single-family home rose an impressive 9.2 per cent on average in Nanaimo and Duncan over the past 12 months, but that was still the weakest increase compared to other areas north of the Malahat, according to the latest monthly report from VIREB.
The benchmark price in August for a single-family home was $546,200 in Nanaimo and $455,100 in Duncan, respectively. A year ago home prices in Nanaimo were $495,700 and $420,600 in Duncan.
Those increases represent a difference of 10.19 per cent and 8.2 per cent.
Benchmark pricing tracks the value of a typical home in a given area and was reported board-wide as $505,800 in August, a 12 per cent increase from one year ago but down from June’s $510,300 and July’s $510,700.
Statistics are not published for Ladysmith and Chemainus.
VIREB, which tracks listings and sales north of the Malahat, had anticipated the market would begin to cool after the big boost in real estate over the previous two years during which time records tumbled month after month.
“The broad demographic trend for the VIREB area continues to include baby boomers and retirees, who are less affected by stricter mortgage qualification rules because they don’t typically need mortgages,” said Cameron Muir, chief economist for the British Columbia Real Estate Association (BCREA).
“As a result, even when sales bottom out, they’re doing so at lower levels on Vancouver Island.”
According to VIREB’s month report, single-family home sales overall across the board rose seven per cent higher between July and August but dipped by 14 per cent when compared with last year at this time.
Last month, 467 single-family homes sold on the Multiple Listing Service system compared to 438 in July and 540 one year ago.
The number of apartments changing hands last month dropped by 13 per cent while townhouse sales increased by 16 per cent.
Duncan led the way with a 21 per cent increase in the benchmark price for townhomes to reach $396,700, compared to $325,700 a year ago.
Nanaimo was at the other end of the scale with only a 10.72 per cent increase over the past 12 months.
In its 2018 Second-Quarter Housing Forecast, BCREA anticipates that MLS residential sales in the province will decline by nine per cent to 94,200 units this year from 103,700 in 2017.
“B.C. housing markets have benefited from the provincial economy expanding well above trend growth over the past four years,” said BCREA chief economist Cameron Muir. “However, economic growth is expected to slow and reflect the long-term average this year.”
The benchmark price of a single-family home for the overall VIREB area posted its first significant drop this year and modest reductions occurred in Duncan, Campbell River and Parksville-Qualicum Beach.
The early signals are that the long-term sellers’ market appears to be tapering off to more balanced conditions with less and less multiple offer scenarios.
VIREB advises that today’s buyers are “savvy and well informed when they arrive at the negotiating table” and sellers need to price their homes accordingly.
“Sellers need to be realistic when it comes to price,” said Don McClintock, 2018 VIREB president. “Not every property is worth a million dollars, and overpriced homes just take longer to sell.”