You’ve undoubtedly heard all about the voracious housing market in metro Vancouver, about how some homes are quickly selling for $1 million over their asking price.
And you’ve probably heard about how this buying frenzy has leaked into Greater Victoria causing its inventory to dry up and its prices to skyrocket.
But have you heard about what all this rabid house-gobbling has done to the prices in Port Alberni? No?
That’s probably because it has done nothing, zilch, nada.
According to the Vancouver Island Real Estate board, the benchmark price for a single-family home on the Pacific side of The Hump in May 2016 remains identical to what it was one year earlier — less than $200,000.
To put it another way, for the price of just one home in Vancouver, you could pick yourself up seven or eight similar homes somewhere near the Alberni canal.
Alberni, followed to a lesser degree by most of its neighbour communities north of the Malahat, has yet to feel the full effect of the recent buying frenzy, meaning some of the most affordable homes in the entire southwest corner of B.C. can be found not far from your front door.
“Well, (Alberni)’s certainly got the cheapest homes,” VIREB president-elect Janice Stromar said. “I actually grew up there and it’s a great place to raise your kids and a great place to retire.”
Although total sales on the Island outside Victoria are climbing at a faster rate — 46 per cent from May 2015 to 2016 — than they have in in either Greater Victoria or Greater Vancouver, that has yet to translate into a corresponding leap in price.
The VIREB, which tracks properties north of Victoria, reports buyers should be able to purchase a typical home for $354,500, a jump of just 9.4 per cent from May of last year. That compares with Greater Vancouver, which reported a benchmark price for detached homes that jumped 37 per cent to a shade over $1.5 million, and Greater Victoria, where the benchmark price for a home in the core region climbed 19 per cent to $706,500.
This comes at a time where Victoria reported a sales increase of 42.4 per cent and Vancouver posted record sales totals for the month of May — 35 per cent higher than its 10-year average.
People talk about Asian and other international buyers pushing the market, but Stromar said that is not necessarily true, at least north of the Malahat. A recently completed 2015 VIREB buyers’ profile showed just two per cent of its buyers came from outside Canada.
Besides, she said, while the market in the big city can influence the local market somewhat, the two do not necessarily directly correspond.
According to Stromar, the bulk of the people sparking the demand from Cowichan north are coming from the usual sources: locals looking for a change and people — largely retirees — migrating to the Island from the Mainland or Alberta.
That said, she has noticed an increase — too small to call a trend — of people escaping the Vancouver market to commute or telecommute from here, as well as a reversal of what had been an outflow of younger workers to Alberta.
In terms of raw numbers, 771 homes changed hands in the VIREB area during the month of May, while 1,289 were sold in the Greater Victoria area.
But the number of available homes remains low throughout the Island. And the laws of supply and demand dictate houses will not remain relatively cheap as long as that situation persists and individual houses continue to get multiple offers.
“The inventory has not been able to keep up with the demand,” she said. “ The demand does not seem to be lessening. I have buyers that I’m taking out every day.”
Benchmark price
May 2015 May 2016
Campbell River $278,400 $287,500
Comox Valley $323,800 $360,400
Duncan $297,400 $317,300
Nanaimo $351,700 $389,800
Parksville/QB $365,600 $417,900
Port Alberni $197,300 $197,300
Victoria $593,200 $706,500
— Victoria and Vancouver Island Real Estate Boards
Follow me on Twitter @JohnMcKinleyBP
