Sales in the region represented by VREB rose 59.2 per cent in May 2020 compared to April 2020 after dropping significantly following the imposition of COVID-19 related restrictions. (Black Press Media file photo)

Real estate sales in Greater Victoria recover in May

Recovery came after big drop off in April, but recovery likely to be slow

The head of the association representing realtors in Greater Victoria does not expect a sudden return to normal as sales in May rebounded from sales in April.

“Our market continues to respond to the current health crisis,” said Sandi-Jo Ayers, president of the Victoria Real Estate Board (VREB), in a release. “Activity in real estate right now echoes the activity in our broader community – as restrictions gradually begin to lift — so too have our sales and listings numbers.”

Sales in the region represented by VREB rose 59.2 per cent in May compared to April, when  COVID-19 caused sales to drop by 52.8 per cent compared to March.

Leo Spalteholz, a local realtor and market expert, said on his analyst blog that May’s rise in sales met expectations.

“Sales increased in May as we knew they would once some restrictions were lifted and people became more comfortable with going out and resuming their normal activities of daily living,” he said. This said, he said that the recovery was a “bit slower” than anticipated and the market remains near a historic low.

RELATED: Real estate sales in Greater Victoria drop almost 60 per cent in April

“On a seasonally adjusted basis, sales for both single family homes and condos are at about the same level as during the worst of the financial crisis,” he said. This said, it was not the worst May on record, said Spalteholz. May 1990 recorded 441 sales, just below the official VREB figure of 457, down 46.1 per cent from 848 properties sold in May 2019.

Spalteholz anticipates sales to improve through June and July, but he also looks toward the fall, when the so-called deferral cliff approaches. During the height of the lock-down measures, banks allowed mortgage holders to defer or skip mortgage payment, a practice that won’t be permanent. “Will there be substantial forced selling in September as the ‘deferral cliff’ approaches?”

Other factors determining the future shape of the local real estate market include the state of the tourism industry and rental market.

Looking at the statistics in detail, they show 2,544 active listings for sale at the end of May 2020, 15.7 percent fewer properties than the total available at the end of May 2019 but a 10.4 per cent increase from the 2,305 active listings for sale at the end of April 2020.

The Home Price Index benchmark value for a single family home in the Victoria core in May 2019 was $863,000. The benchmark value for the same home in May 2020 increased by 2.6 per cent to $885,400, 0.1 per cent more than April’s value of $884,600.


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