REAL ESTATE ON SALT SPRING ISLAND – HOW DID WE DO IN 2010?

Last year a total of 195 properties changed hands on the Island. Though a moderate sales volume at best and the 3rd consecutive year with sales volumes under 200 (the lowest since year 2000), last year nevertheless was an improvement from the 2 previous years. For a reference point, the highest annual number of sales in the last 10 year period occurred in 2003 (316 sold properties). In the SFD (single family dwelling) non-waterfront detached sector the number of sales has also improved, from 100 and 117 sales in 2008 and 2009 respectively, to 123 sales in 2010.

What about prices?

In the detached SFD non-waterfront sector we saw a 3% increase in the average sale price (4.6% in median price) from 2009 to 2010. In absolute terms the average sale price for a non-waterfront SFD on Salt Spring Island was $533,386 (with the median price at $461,100). By comparison, in 2000 the average sale price of the same property type was $249,839 and in 2008 it statistically peaked at $623,492. We are currently down from the 2008 peak by about 17%. The least expensive SFD in 2010 sold for $200,000 for a 600 sq.ft. mobile on 1 acre of land close to Ganges and the most expensive SFD non-waterfront was $1.775 mil for a custom home on an acreage with a spectacular view.

In the under the $500k range of SFD non-waterfronts, 2010 brought a slight decrease in both the average and median sale prices, down from 389,965 to $385,457 and from $408,638 to $407,882 respectively, 76 properties in this price range sold.

Oceanfront property prices on Salt Spring Island recovered somewhat after a peculiar statistical drop of 40% in 2009. Up 14% in 2010 with the average sale price of $1,168,333 (median was $1,051,000). 18 ocean front properties sold in 2010, one half of which were over $1 mil, with the least expensive at $459,000 and the most expensive at $2.85 million.

The sectors that did not do very well in 2010 were vacant land and town homes. Only 7 lots under 2 acres sold in 2010 with average price of $223,446. The highest average price of $291,652 was in 2007 when 23 lots under 2 acres changed hands. Compare this to year 1999 when 30 lots solds with average price of $73,945!

In the case of town homes, only 8 units sold in 2010 (+ one waterfront Grace Point) ranging in price from $317,500 for a 1300 sq.ft. clean older unit to $518,000 for a spruced up very private unit of 1784 sq.ft.. By comparison, in 2009 we sold 14 units with marginally higher average and median prices.

How does Salt Spring Island compare to the rest of the country? Except for Calgary that experienced a market correction in 2010 and New Brunswick, the rest of the country showed slight to moderate price increases from 2009 to 2010 with Vancouver West leading the way with impressive 15%, followed by Winnipeg and Montreal. Victoria reports moderate price increases of 3.4% for detached bungalows, 6.9% for standard 2-storey detached and 7.5% for standard condominiums.

What is ahead for 2011?

The consensus is that nationally the prices will continue to appreciate throughout 2011 with the bulk of the sale activity in the 1st 6 months of the year, similar to 2010. This is driven by the unsustainable low interest rates that are bound to rise in the near future, especially in the effort of the Bank of Canada to moderate the strong Canadian dollar. Salt Spring Island is expected to be no exception, in fact, we could see above the national average price appreciation in 2011. Many potential Buyers are currently observing from the sidelines, they may recognize that the market and the interest rates have likely hit the bottom and will be rising (albeit gradually), and may make their purchase in 2011. In addition, the warm and beautiful south western part of B.C. continues to be a prize location, attracting many from across Canada and from around the globe.
We are currently in a relatively stable market, albeit still with high inventory of listings, it is a good time to buy and yes, even a good time to sell, especially if you’re purchasing another property after you sell.
The complete Canadian House Price Survey as well as the 2011 forecast can be found on the RLP site, www.royallepage.ca, click on “Strengthening economic recovery …”, upper right hand side.

Courtesy of Tom Navratil
Realtor, Royal Lepage Saltspring Realty