Nanaimo Real Estate Market Update
Below is a recent article from the local paper “The Nanaimo Daily News” that pertains to Nanaimo real estate.
And of course, being on the inside of the industry and raher detail oriented (aka ‘anal’), I can’t just put this up without my two cents.
First of all, the stats for the rest of the island are mostly showing rises in prices since one year ago, and those two that fell are a 1 percent and two percent drop. Those are for Parksville/Qualicum and Port Alberni respectively. But such stats are only loose guidelines as to what is happening with home values, because they measure what people are spending not what the values of actual properties are doing. A strong correlation, yes, but not the same thing. The only way I know of to really know what is actually going on with property values with a of accuracy is by being a Realtor or a Property Appraiser.
Also, comparing things on a year to year basis doesn’t seem accurate to me. Last year at this time was a fairly slow market, which we were comparing to the year before that which was the busiest year on record. So any conclusions based mostly on year to year comparisons seem out of any meaningful context to me. There’s no perfect way to do it that I can think up, but using an average from the past five years as a better benchmark would make more sense to me.
But none of this is to contradict the main message of the article. It’s quite busy out there lately and so far it looks like the slow times are over. That is, until the next time everyone gets scared about something in the economy.
Nanaimo homes sales are doing well despite falling Island real estate market
Nanaimo’s real estate market remains on solid ground, even if sales are falling in other Island markets.
Nanaimo realtors report 119 houses sold in September, a 21% increase from a year ago.
At the same time, the median price is holding steady at exactly where it was in September 2008 at $330,000.
Realtors say all the right elements are coming together to keep Nanaimo’s real estate market strong. Interest rates remain low, prices are reasonable and housing inventories are about right for both buyers and sellers. Realtors are watching closely to see what happens this fall, in advance of harmonization of the provincial sales tax with the GST.
That will drive prices up considerably for new home buyers.
But there is also a sense in the market that the worst is over in the global recession that drove real estate markets into the doldrums everywhere.
One odd anomaly in September’s sales figures, 31 fewer units sold that month than in August.
That is typically one of the slowest sales months of the season, outside Christmas. But realtors aren’t complaining.
“Compared to last year sales are up because inventory is down,” said Sue Ghose, Nanaimo representative of the Vancouver Island Real Estate Association.
When inventory gets too high and prices are low, customers tend to kick tires more before buying, making sellers anxious and driving prices down.
That was the situation earlier this year, causing some sellers to pull properties off the market.
“If you drive around now, you’ll see lots of sold signs,” Ghose said. “People like to buy now because interest rates are holding.”
Two other Island communities saw real estate prices actually rise last month – Campbell River, where median prices rose 1% to $297,076 and the Cowichan Valley, where the mid-point sales price hit $327,763, an 8% rise in that market. All other markets reported higher sales volume increases than Nanaimo last month, with Comox Valley reporting the biggest jump at 66%.
Ghose said one factor driving sales volumes could be concern among buyers about the introduction of the HST next July. “That could be another cyclical effect,” she said. “If it comes, people buying new houses will think ‘I might as well buy it now.'”
With prices either flattening out or trending upward again and sales volumes up, Ghose said it’s a good sign for the economy.
“Consumer confidence is back. I’m very cautiously optimistic, but the market is very active right and prices are very affordable in Nanaimo.”