Changes are on the horizon for the Comox Valley real estate market in 2013. As 2012 draws to a close, predictions and forecasts for 2013 abound. Consider that a Google search today for “2013 forecasts” yielded more than 80 million results and that one for “2013 predictions” yielded over 85 million. Just about everyone has an opinion on something. When it comes to real estate market and what will happen in 2013, there are also many different opinions. Some are more informed than others. The British Columbia Real Estate Association is forecasting an increase in MLS home sales over 2012 to 74,920 units which is still below the 15 year average of 79,000 unit sales. BCREA also forecasts a decrease in the average MLS price (largely due to luxury home sales returning to more normal levels. While this information may be interesting to some it does not provide a sense of what will happen to the Comox Valley real estate market and all of the current listed priced at more than $100,000.
As I have said before on a number of occasions in previous blogs, real estate is local and it can be very local. What does this mean in practice? While there may be changes and/or variations in our local real property market statistics concerning the entire market, the changes may be interesting but they may not provide a good sense of what is happening in more localized areas or situations. This certainly held true in 2012. Some areas of the Comox Valley experienced home sales at a higher level than other areas of the Comox Valley. Crown Isle resort and golf course real estate listings generally fall into this category. As well, sales in some price ranges were regular while sales in other price ranges were miserable. At the start of 2012 I forecast that 2012 would be a “settling” year. For 2013, I forecast an adjustment year. Activity and prices did level out in many ways in 2012 but not all those in the market adjusted to the new realities of the market. Those who did were fairly successful.
Recall that Comox Valley real estate sales peaked in 2007 and the following year they dropped by about 30%. Between 2009 and 2012 sales were up and down slightly in each of these years but time to sell (on average) increased in a number of categories. For 2012 sales remained closer to the overall level experienced by the end of 2008 and property sell to list ratios reached new lows while total inventory reach new highs in the short term. Many buyers adjusted to the buyers’ market and they were able to do fairly well. Some decided to wait until 2013 to buy expecting that they will see even bigger bargains. Some home sellers did not adjust to the new reality and quite a number of homes did not sell. Some did not even receive any showings. Almost everyone I know likes to take advantage of a bargain but few I know ever like to lose money. The same is true in real estate. Unfortunately, markets are cyclical and they experience both highs and lows over time.
Looking ahead, interest rates are expected to remain fairly low for 2013. The BC Government announced a transition from the HST to the PST in 2013 with a re-implementation target date of April 1, 2013. Both of these external influences should have a positive impact on our local market. As well, many Baby Boomers and others continue to look to the Comox Valley as a retirement location. While total numbers may have decreased compared to a few years ago this demand should help increase activity in our local market. Activity should also increase as a result of some pent up demand from locals who held off buying (or selling) because of the realities of the current realty market. All of these influences should have a positive impact on our local market. There are, of course, continued negative influences such as the European Financial challenges and the “Fiscal Cliff” being addressed by the United States. The degree to which they actually influence our local market is unknown and currently not quantifiable. Overall, I believe that our local market will be positively impacted more than it is negatively impacted barring some completely unforeseen significant event. The Comox Valley real market should experience a year of adaptation. The market has changed from the peaks of 2007 and this past year a significantly amount of settling occurred in our market. We are currently living in a new market reality to which not everyone has adapted. This should be the year that this will occur.
Our regional Comox Valley homes and properties market is not homogeneous. There are variations by price, location and other factors. If you are looking to buy or sell in 2013, contact me directly or through RE/MAX Ocean Pacific Realty and let’s discuss your Comox Valley real estate needs and current market updates so that you can make the most out of the current market as either a buyer or as a seller.