victoria sees its first annual sales increase in 3 years The Greater Victoria market saw its first increase in annual sales last year since 2021, spurred by a wave of interest rate cuts in the second half of 2024. As such, sales in the second half of the year were quite a contrast to the first half.
Though the seasonality in residential real estate activity typically sees active listings drop sharply towards the end of the year, stronger sales through the fall put additional downward pressure on inventory. There were 1,525 active listings at the end of 2024 and, though this was still 18% higher than the prior 10-year average for December (1,294 listings), it was down 5% relative to the same time last year (1,611 listings). This was the first time since April 2022 where inventory in Greater Victoria was lower than the same month in the prior year. Supporting this trend of stronger sales activity into the new year are adjustments to mortgage insurance rules that recently came into effect. As of December 15th, buyers can put lower down payments and secure cheaper insured mortgage financing on homes priced up to $1.5 million, up from $1.0 million previously. Additionally, first-time homebuyers and all buyers of newly-built homes will be able to access amortizations of up to 30 years on insured mortgages, up from 25 years previously. These new mortgage rules, alongside an expectation of further declines in borrowing costs, should continue to support sales activity near long-run monthly levels into 2025.
The Greater Victoria market finished 2024 on a strong footing with sales coming in at or near their long-run monthly average in each of the final three months of the year. There were 385 sales across the region in December, which was just 2% below the prior 10-year December average of 395 sales. Relative to December 2023, sales were up 30% to mark the sixth consecutive month where sales were higher than the same month in the prior year. This string of year-over-year sales gains correlates with the wave of interest rate cuts delivered by the Bank of Canada in the back half of last year. Between June and December, the Bank cut a cumulative 175 basis points from its key policy rate, bringing it down to 3.25% from a more than two-decade high of 5.00%. This decline in the policy rate, in tandem with an easing in government bond yields, put downward pressure on mortgage rates and significantly improved purchasing power heading into
the fall housing market. As a result, sales in October came in 62% higher than October 2023, followed by a 41% year-over-year gain in November. All told, sales in the last six months of 2024 were 24% higher than the same period in 2023. In the first six months of the year, sales were up just 0.6%. Thanks to stronger activity in the second half of the year, the Victoria market saw its first annual sales increase since 2021. There were 6,707 sales in 2024, an 11% increase from total sales in 2023 (which was a decade-low at 6,053). There were other factors that helped contribute to the increased activity, including more than two years of pent-up demand and inventory that hovered around a decade-high for much of the year. But the easing in borrowing costs was certainly the key to unlocking buying activity. By our estimates, buyers using variable rate financing have seen a roughly 19% increase in purchasing power since June.
3 Copyright © 2025 rennie group of companies. All rights reserved. This material may not be reproduced or distributed, in whole or in part, without the prior written permission of the rennie group of companies. Current as of January 13, 2025. All data from the Victoria Real Estate Board & Rennie. While the information and data contained herein has been obtained from sources deemed reliable, accuracy cannot be guaranteed. rennie group of companies does not assume responsibility or liability for any inaccuracies. The recipient of the information should take steps as the recipient may deem necessary to verify the information prior to placing any reliance upon the information. The information contained within this report should not be used as an opinion of value, such opinions should and can be obtained from a rennie and associates advisor. All information is subject to change and any property may be withdrawn from the market at any time without notice or obligation to the recipient from rennie group of companies. E.&O.E.
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