March sales activity was up from February, but not as much as might have been expected from what is normally our busiest month. So far in April, sales seem to be keeping a pretty good pace with March, so it's possible that some of that activity is the result of a late or prolonged spring market. Inventory in Greater Victoria has only increased marginally in the last few months and is not quite hitting the spring flood some had been hoping for to bring us back more securely into something like a balanced market. It is good news that our inventory increased at all, considering inventory across the province has fallen for two consecutive months.
Part of this stalemate of relatively stable sales and listing activity is the lack of change in interest rates, with the Bank of Canada holding rates again in their April 12 announcement. This was the second hold in a row after a very aggressive rate policy.
There were 590 total sales in March on the Victoria Real Estate Board multiple listing service, which was 28.3% more than in February but 29.2% less than in March 2022, when the market was much hotter. Single-family homes made up 281 of those sales, down 31.8% from last year; condos made up 197 of those sales, down 31.8% from last year. Compared to the relatively meagre 277 sales in January, there is certainly an indication of a return in demand from buyers. The good news for our clients and our Group: while the rest of VREB was down 29.2% in sales year over year, we wrote 30.7% more contracts than in the same period last year, meaning more wins for our clients.
For listings, the end of March saw 1,970 units on the MLS, which was an 8.9% increase from February; they come, however, during a time when we would expect a bigger rise due to the seasonality of real estate. The 1,970 listings in March is a pretty staggering increase from the low-lows of just 12 months previous when inventory was sitting at 1,063 units.
Months of inventory (MOI) for March 2023 came in at 3.3, which represents the low side of a balanced market that's moving toward a seller's market. This would seem to indicate that there is some upward pressure on prices, and we've seen indications of that in some Victoria neighbourhoods. That being said, buyers are somewhat limited regarding affordability, so there is room for negotiation, with more motivated sellers lowering their prices to get a quick sale.
Regarding sellers lowering prices for multiple offers and quick sales: they are still getting multiple offers, oftentimes selling over the asking price. Offers just aren't up to the magnitude of early 2022—sellers are seeing three parties at the negotiating table instead of 14, and it's still possible for buyers to win with conditions on their offers. Provincially, average home prices have risen for two consecutive months, which is also important as the island can sometimes take a little while to catch up.
We said in a previous market update that “nothing will change if nothing changes” in reference to legislative and interest rate changes. Well, the BC government announced their new “Homes for People” plan, which promises to "speed up delivery of new homes, increase the supply of middle-income housing, fight speculation and help those who need it the most." The plan includes $4 billion over three years and a promise of another $12 billion to follow over the next 10 years. The plan will focus on eliminating restrictions and making it easier to build new construction homes while also adding thousands of social housing units. For those interested in a deeper dive, it's worth looking into the Homes for People resources.
As for interest rates, everyone is holding their breath and watching the inflation numbers in advance of the next scheduled announcement on June 7. No one—not even the economists—is claiming any certainty about inflation, though they are forecasting (with heavy disclaimers) for inflation to fall to 3% by mid-year and return to the 2% target by the end of 2024.
The Group recently held its 24th Annual Easter Egg Hunt, which was fantastic! It featured more than 30,000 easter eggs, face painting, a colouring contest, bubble blowing, cupcake decorating, hot dogs, Sunny Bear and (of course) the Easter Bunny. On top of all that fun, we also were able to raise $4,700 for the BC Children's Hospital. We are grateful for all the volunteers who helped out and everyone else who came. We are already looking forward to the 25th!
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