After an interesting 2020, here we are in 2021. So where is the Comox Valley real estate market headed and what can home buyers and sellers expect for the coming year?
Let’s start with what the British Columbia Real Estate Association (BCREA) expects. They provide five reasons why 2021 is looking considerably brighter than 2020. First, despite what may be the second worst recession in BC history (a decline in BC’s real GDP by 5.5% in 2020), the housing market had a record fall 2020 season and prices are rapidly rising as pent-up demand floods into an under-supplied market. Second, as that pent-up demand from the loss of a spring season fades, sales will likely slow from their current pace, but activity is expected to remain strong as record-low mortgage rates and a recovering economy continue to drive sales. Third, the average Canadian 5-year fixed rate has fallen to under 2 per cent, the result of a rapid and overwhelming policy response to the COVID-19 pandemic from the Bank of Canada. The Bank has signaled that it may hold its policy rate at its effective lower bound of 0.25 per cent until as late as 2023 and will continue its quantitative easing program until the Canadian economy is on a sustained path to full recovery. The combination of those actions by the Bank of Canada should keep mortgage rates very low for the foreseeable future. Fourth, The BC economy is showing signs of recovery, though that recovery is very much K-shaped in that some sectors are recovering at a much faster rate while others continue to languish. Higher-wage sectors have seen employment fully regain pre-pandemic levels, which partially explains the continued strength of the ownership market in BC. Fifth, On the supply side, active listings remain low due to hesitation on the part of sellers to list during the pandemic. Some additional supply may come online following the end of mortgage deferral programs, but given the tightness of market conditions, that supply is unlikely to be disruptive. Overall, BCREA anticipates strong momentum heading into 2021, with sales ultimately rising 9.7 per cent to 99,240 units. The provincial MLS® average price will finish the year up 9.9 per cent before rising a further 2.6 per cent in 2021.
So, what about the Comox Valley? Sales activity remained relatively strong at the end of 2020 and multiple offers in the home sales average price ranges were relatively frequent. This was mainly because a falling supply of good listings. This, in turn, led to rising home prices. New home construction remained strong and as employment starts to recover, we should see the market pick up in strength and numbers of listings. Home sellers should not hesitate to get their homes on the market early this year and home buyers should expect an increased number of listings and more choice as 2021 progresses. In a typical year, the home sales listing cycle begins in early January and steadily climbs until it peaks around the end of May. Thereafter, this is a drop to the end of July and another drop after Labour Day.
For Vancouver Island, the Vancouver Island Real Estate Board expects, that, even as pent-up demand on the Island begins to fade, activity in the housing market will remain strong. Mortgage rates are expected to remain near historic lows for quite some time, and demand from those able to work from home or those accelerating retirement plans will keep demand for real estate robust on Vancouver Island. The Vancouver Island board region will likely see an increase of 7.9 per cent next year to 8,900 units. Here in the Comox Valley the expectation should be similar. Many people from the mainland have moved to the valley as their retirement and relocation choice given our great weather, scenery, and quality of life.
If you are looking for a retirement or relocation option why not give the Comox Valley serious consideration? Contact Brett for help either selling your home in the Comox Valley or for help finding and purchasing your next home in this fabulous part of Vancouver Island. Brett specializes in Crown Isle, Comox and Courtenay homes for sale as well as luxury and waterfront offerings. When you need local market expertise that you can count on contact Brett.