Copyright, Li Read, 2024
Welcome to March: A Transition to Spring
March...it unleashes Spring. Meteorological Spring arrives on March 1st and the calendar signals the 20th.
Does it come in like a lion or a lamb? A mixed month weather-wise, but that 8 seconds more of daylight every day is delivering extended light and the upcoming daylight saving time change is a factor.
March...it also signals the beginning of the real estate market’s Gulf Island seasonality...March Break (mid-month) to Canadian Thanksgiving Weekend (mid-October) are often described as “the season” for Salt Spring and the Gulf Islands.
Narrows West Lowbank Oceanfront
Real Estate and Seasonality in the Gulf Islands
Current Market Overview
Sales certainly take place throughout the year, but it does seem that the March to October timeline encourages tourism, real estate exploration, decisions to buy...for the whole Pacific Northwest Coast, including in the secondary home/recreational environment of the Gulf Islands.
The very beginning of this March arrives humming the same tune that has characterized the real estate market on Salt Spring and the Gulf Islands since Fall, 2023...a lack of inventory. Most owners do not want to sell.
Sunny Ocean Acreage
The two year pause in buyer action (2022 & up to November 2023) did not see a spill-out of listings. The rise in interest rates may have caused some of that pause period, and kept some owners from selling at a low action period, but perhaps a bigger reason for fewer listings might be the fact that a potential seller can’t find a property to move to. Low inventory is a coastal issue. No one wants to be “houseless”.
All levels of government (municipal, provincial, federal) are struggling with the lack of available housing, right across Canada. Strong immigration puts further pressure on housing. Owners not wanting to sell are perhaps also wanting to retain the safe haven they already own...perhaps as a hard asset hold to preserve capital. For a Gulf Island, under the governance of the Islands Trust, the Trust capped growth...there will always be a lower growth and a regulated model in place (the Trust has been in charge since 1974).
Fulford Valley 42+ Acres
Low inventory coupled with buyer desire does lead to price escalation. By late April, we may see this market trend fully back in play. There will be a provincial election in October and efforts are being made to create housing...such concepts would not be available for two plus years and might only add seven to ten thousand units. It seems that low inventory will remain a housing crisis issue, whether buying or renting.
Real Estate Listings Overview
March Activities and Events
Oceanview Vineyard with Cottage
March: longer days, with a mix of left-over winter and almost spring weather, bulbs and early shrubs flowering forward, gallery openings that showcase new works, live music venues to enjoy, season re-opening of Hastings House, Home & Garden show weekend (thank you Windsor), and an early Easter Weekend (the last weekend of the month). Saturday Market-in-the Park season smiles hello. (Enjoy the newly reconfigured Centennial Park). Seek out the March presentations at ArtSpring...the Arts are alive and well on Salt Spring. Check out special menus at our great restaurants and coffee stops. Spa retreats, beachcombing discoveries, hiking/walking trails to meander...time to wake up with the season.
March sings the song of Spring. Welcome!
February in the Pacific Northwest Coast Real Estate Market
February often starts the early Spring market on the Pacific Northwest Coast. The trend for 2024 might not be evident till March Break, but February introduces the early activity.
Salt Spring Real Estate Market - Early February
What do we see in the Salt Spring real estate market at this very beginning of February? The song of thin inventory continues. This is a theme seen in competing Vancouver Island communities...lack of listings is not just a Gulf Island issue.
Why Owners Hesitate to Sell
There are many reasons for owners not wanting to be sellers. That flight from urban to rural, post-pandemic, continues. It may be about a desire for safety. Geopolitical concerns are part of location decisions. A desire to be apart from city problems is a strong driver to action...a seeking of a "kinder gentler" lifestyle makes sense. There is also that "back to the land" component, where one can be self-sufficient if supply chains falter. These elements may propel buyers, but they also stop owners from becoming sellers...they are already enjoying these elements. IF they thought of selling, they would discover they can't find a replacement property elsewhere...no inventory...and so it goes.
Gulf Islands Governance and Real Estate
Under the Gulf Islands form of governance (Islands Trust, with a mandate to "preserve and protect" the environmental beauties of the Gulf Islands for the benefit of all B.C. residents), in place since 1974, a buyer purchase/investment is ensured to remain as purchased. In this era of extreme change, this continuation of what one fell in love with, and purchased, is a strong feature of decisions to invest on a Gulf Island.
Market Dynamics and Future Trends
It's also a recipe for price escalation. Will we see multiple owners as a buyer profile, going forward, so that one can enjoy ownership of a Gulf Island property? Hmmm....there are always work-arounds and creative ownership models may be one outcome to encourage the opportunity to own, as prices rise and inventory remains static.
A February 2024 Market Analysis On Salt Spring
So: the very beginning of February shows continuing low inventory, with buyer interest showing up in all price ranges and property types, and now with a sense that one needs to act. The pauses in action, seen in 2022 and 2023, appear to be over. Oddly, this increase in activity began in November 2023. The interest rate fluctuations remain a factor in buyer outcomes. Those having to renew mortgages in 2024 and 2025 will also be making decisions as to whether to hold or to sell. Lack of inventory to buy or to rent may decide people to struggle on with current ownership.
Real Estate as Capital Preservation
Many on both sides of the seller/buyer divide are seeing real estate as a way to preserve capital. Concern about erosion of purchasing power of currencies has people thinking about how to retain value in their holdings.
Anticipating Future Outcomes
Lots of outcomes still waiting to be formed...it's very early in what promises to be a busy year. It's a good idea to attend seminars and financial webinars...all information is helpful in times of change. And also keep an eye on AI...implants that allow one's thoughts to effect change? Hmmm.... Mid-Feb welcomes the Year of the Wood Dragon in the Asian Lunar New Year. The western zodiac sees Pluto in Aquarius, a line-up not seen since the French Revolution. Recipes for change? Keep your editing function fired up.
Exploring the Local Area in February
So: February. Check the garden...early bulbs and shrubs are flowering forward. Give yourself the gift of new...zip off to Victoria or Sidney and look at a different set of walls. Remember the Cowichan Valley...on our doorstep and lots to see and do there. Beaches to explore at Parksville/Qualicum or all the way to Tofino. Check out our close neighbours, the other Southern Gulf Islands...each with their own signature. A day trip makes us glad to get back to Salt Spring's many charms. Family Day holiday weekend in mid-February invites us to sample other nearby spaces. Lucky us...adventure on!
January ponderings...The Roman god Janus gave his name to this beginning month of the New Year. With two faces, one looking behind and one facing forward, Janus reminds us that every beginning carries with it some of what went before...and also introduces the new.
If you are interested in the Asian horoscopes, then it's good to know that February 10th ushers in the Year of the Wood Dragon.
Change is The Wallpaper of Our TimeIt's taken 23 years for the real 21st century to finally arrive.
Early forays into websites and emails morphed into social media communications. It really is now possible to pretty much do one's life and business off a smart phone. 5G speeds it all up.
Zoom during the pandemic closures got us all used to image only meetings. What will happen to all those empty office buildings? If there is a housing shortage (and there is), then why are they not being turned into interesting housing developments?
And what about AI? Clunky ChatGPT is only the rudimentary beginning. So: reality. Virtual, augmented, real...and so forth and so on. It's called artificial intelligence...the second word implies thought.
If someone gave us a ticket to 1996, would we take it? It seems like a time that is already in the far far past.
Meantime, since change is simply the wallpaper of our time, and we must flow forward on this river of shift, it's essential to recapture our editing function. Data is not information. What is visible on the internet may not be authentic. Only our editing ability will help us sort it out.
Is Real Estate Strengthening?Yes. The almost two year "pause" (soft sales, low inventory, nervous buyers) of 2022/2023 is over. Prices are higher. Most owners do not want to be sellers. Buyers want to act. The difficulty about low inventory: not enough choice for a buyer. If they don't find what they are looking for, they won't act. Yes, there are fewer sales, but that's because there's less to sell. What will happen when many mortgages will be up for renewal in 2024? Often, secondary home/recreational marketplaces can be somewhat insulated from this renewal scenario.
At this very beginning of January:
There are approximately 77 residential listings on Salt Spring, not separating out single family, townhomes, farms, waterfronts.
There are 31 land listings, not separating out waterfronts, acreages, lots. That's a total of 108 listings...a balanced market might see 280 listings.
At the end of 2023, there had been approximately 179 sales, ranging between $55,000 for a mobile in a park and $4,288,000 for a waterfront on five acres. Projections continue to call for consistent positive real estate outcomes, based on strong immigration and lack of housing options.
The various government measures to increase rental stock and buyer options (vacancy tax, prohibition on out of country buyers, increased purchase tax for non-residents) have not proved to create more housing opportunities. Artificial government edicts do not take the place of encouraging private enterprise to build/to develop. The lack of housing will continue for some time.
Geopolitical concerns continue. Worries about inflation, and currencies also continue. Remember Voltaire and his warning that paper money always reverts to its true value: zero. Is another reason for buyers seeking out special properties in unique areas simply a desire to preserve capital? Is this also why owners are not wanting to be sellers?
Many changes in the real estate industry itself. Stay tuned as the ways to buy and to sell real estate undergo significant changes...just as all segments of society must grapple with serious change. Nothing is exempt.
January of 2024Lots to think about as we emerge into early January of this New Year. It is a New Year and we can choose whether to look backwards or to opt for Janus' forward staring face.
Meantime, January...a month to savour that every day is eight seconds longer. We are on the slow march to Spring. Now there's a thought!
2023 Market Analysis Posts