The Real Reasons Home Prices Are Rising in Greater Victoria
When the 2017 Demographia International Housing Affordability Survey was released in January rating 406 cities in nine countries, they rated Victoria as “severely unaffordable”.
The survey considered housing costs in relation to one year of median household income. The statistics were compiled using the third quarter of 2016 and do not consider differences in house sizes. (Demographia defines housing markets as affordable when median prices are less than three times the median household income).
At the time of reporting, Victoria was ranked 381 out of 406 cities, reflecting its rating of 8.1 times the median income of $67,300 required to buy a house with a median cost of $542,400.
Since then, The Multiple Listing Service® Home Price Index benchmark value for a single-family home in the Victoria has risen to $834,200 as of July 2017.
The report said that rapidly escalating house prices in cities around the world are associated geographic containment and wider adoption of urban containment policies. That’s certainly true here; Victoria is hemmed in by water, while Saanich practices urban containment to protect some parts of the municipality from development.
When you combine containment with a demand that has far outstripped supply, prices are guaranteed to rise.
“The activity level in the Victoria real estate market continues to be brisk,” says 2017 Victoria Real Estate Board President Ara Balabanian.
Balabanian describes “low inventory levels, with listings for sale consistently below 2,000… supply is still lower than we expected, which puts pressure on pricing and availability.”
The reason people want to move here is self-evident to those that already do. We receive the least snow, our flowers are the first to bloom, and we enjoy over 2,000 hours of annual sunlight. Combine a fantastic climate, terrific lifestyle, a strong economy, low unemployment, and historically low interest rates… No wonder everyone wants to live here.
Dubbed the “California of Canada”, people across Canada and around the world are noticing Victoria. In a 2015 survey, over fourteen percent of retiring Canadian Boomers surveyed indicated a desire to move here. Victoria ranked as second on a list of the world’s hottest luxury markets in Christie’s International’s 2016 report, and the New York Times and Lonely Planet named our region of Canada as the number one place to visit.
While we can’t bring our home prices beneath three times household median income, we can ensure our homes at Saanich Ridge Estates are within reach of more people who want to live in the abundance and beauty of Saanich. Contact us and find out more about our new “Closer to Life” community and the tools we can employ to help you achieve home ownership.