Victoria Housing Market Shows Mixed Signals in February

Victoria's housing market offered a tale of two segments in February 2024.

While single-family home sales surpassed last year's figures, the condo market saw a significant slowdown.

The market is also at a higher risk of a price correction than other Canadian markets due to high price volatility and a mismatch between housing costs and local incomes.

Single-Family Homes See Uptick in Sales

Sales of detached houses were brisker than in February 2023, but they remained below the peak activity witnessed in 2021 and 2022.

Inventory levels, while technically low, are well above the 10-year average.

Notably, the number of active listings for single-family homes is the highest in three years, potentially driven by homeowners facing mortgage renewals at higher interest rates.

The median house price in Victoria accelerated in February, sparking some concerns. While the benchmark price held steady, this discrepancy could point to future price increases or a scenario where only high-net-worth buyers are active, leaving the lower end of the market stagnant, possibly due to rising borrowing costs.

Condo Market Feels the Chill

In stark contrast to the single-family market, condo sales experienced a significant slump in February, marking a three-year low.

Condo inventory remains high, pushing the market towards a buyer's advantage for the first time in years, with buyers having more negotiating power than ever before. Active listings for condos are also at a three-year high, mirroring the trend in single-family homes.

Condo apartment prices are reflecting the market shift, with a clear downward trend emerging in February.

Market Poised for a Buyer's Summer?

The increasing supply in the single-family home market, coupled with the sluggish condo market performance, points toward a potential shift in favour of buyers throughout 2024. Traditionally, spring favours sellers, while late summer offers more advantages to buyers. The current buyer-friendly market conditions suggest a possible correction later this year, potentially materialising in the summer months.