Global Pandemic Strikes Real Estate Sector

It should come as a surprise to no one that the ongoing COVID-19 global pandemic has severely impacted the real estate sector – as it has virtually every other aspect of the world’s economy. In its latest statistical report the Vancouver Island Real Estate Board (VIREB) states that housing sales across the Island were down substantially last month when compared to a year ago.

The VIREB report shows that 189 single family homes were sold on the Multiple Listing Service® (MLS®) System last month, a drop of 54 percent from a year ago when 412 properties traded hands. In March, before the full influence of the virus could be felt, 333 single family homes were sold on the MLS® System. The dramatic downturn in activity was felt across all styles of housing, with townhouse sales down 69 percent from last year, and apartment sales plunging a full 82 percent year-over-year.

Market uncertainty was also felt in the Island’s inventory of available properties, with the pool of single family homes dropping by nine percent. Last month there were 1,173 properties of this type on the market, compared to the 1,293 single family homes that were available during April 2019.

An interesting statistic is that while the townhouse inventory dropped by 19 percent from last year – from 197 units to last month’s total of 160 – the number of apartments for sale on the MLS® System actually rose by a full 33 percent. During April 403 apartments were listed for sale, compared to the 303 available for purchase during April 2019.

VIREB uses benchmark pricing to track the value of typical homes in each of its individual zones, which extends from the northern tip of Vancouver Island to the start of the Malahat in the south. In all of these areas, despite the impact of the virus, year-over-year price increases were recorded last month in virtually all regions.

The board-wide benchmark price of a single family home last month was reported as $523,700 – a number that while three percent lower than the April 2019 benchmark price was slightly higher than the price recorded in March. The board-wide benchmark price of apartments sold within VIREB’s coverage area during April was $313,300, a five percent increase year-over-year, with the townhouse price climbing two percent from last April to $421,400.

Benchmark price increases were reported in all of VIREB’s zones, with Nanaimo’s benchmark price edging up two percent to close the month at $572,200. In the Parksville / Qualicum Beach area the April benchmark price rose two percent year-over-year to $588,800, while in Duncan the benchmark price was $482,800, a marginal increase over the April 2019 price.

In the Comox Valley the benchmark price of a single family home last month was up two percent to $521,300, while further north in Campbell River the price was up four percent to $438,500. In the Alberni Valley the benchmark price was up a full 11 percent from last year, reaching $336,200.

Obviously it is not ‘business as usual’ in any part of the Canadian economy, with real estate being no exception. The only certainty is that things will improve over time, and that real estate is still the soundest investment anyone can make.

Especially in today’s uncertain market it’s important to have professionals on your side when making the biggest purchase of your lifetime. Call Peter and Kathy today to learn more about the local real estate marketplace. We’ll all get through this, together.