Based on REIN’s Real Estate Cycle Scorecard Clock, the economic fundamental key drivers and the market influencers says the Victoria’s real estate market is in the “middle to end of [a] recovery.” Submitted

Report suggests Greater Victoria headed for another real estate boom

Report by Real Estate Investment Network (REIN) says region in middle of a technical recovery

Believe it or not, a new report argues that Victoria is about to experience a real estate boom.

“The boom has yet to hit Victoria,” said Jennifer Hunt, vice-president of the Real Estate Investment Network (REIN), a Vancouver-based company that offers education, analysis, and research among other resources to real estate investors. “There is still runway to enter the market.”

Hunt made those comments after the company released a report that surveyed the Top 10 cities in British Columbia for real estate investors, with Victoria finishing fourth behind the leading trio of Surrey, Abbotsford, and New Westminster. Kamloops, Kelowna, Chilliwack, the Tri-Cities, Burnaby, and Vancouver follow Victoria to round out the Top 10.

Drawing on 17 criteria, the report categorizes surveyed cities across three conditions: boom, recovery and slump. Each of those conditions in turn requires different investment techniques during different phases of each cycle. Overall, the report identifies three investment techniques: ‘buy and hold,’ ‘rent to own,’ and ‘fix and flip.’

Vancouver, for example, currently finds itself at the end of a boom on REIN’s real estate cycle clock, a visual representation of this concept. Accordingly, investors should avoid buying and holding properties, because prices have hit a peak.

Victoria, according to the report, finds itself in the “middle to end of [a] recovery.” Accordingly, the report identifies ‘rent to own’ as the ideal investment technique. It also identifies ‘buy and hold’ as a good technique, because prices still have room for upward mobility.

This assessment raises an obvious question: how can Victoria be in recovery, when prices, have been heading in only one direction, namely up. According to House Victoria, a blog tracking local real estate figures, the median price of a detached home in Victoria now approaches $750,000. Four years ago, it was just over $500,000.

Hunt and her co-author Don R. Campbell address this question early in the report when they acknowledge that readers might be surprised to learn that many markets including Victoria find themselves in a ‘recovery’ phase.

“The label of “recovery” doesn’t just mean it is coming out of a slump; it is a technical term describing the combination of the underlying fundamentals and comparing them to how the market could perform in the future,” they write. “Strategic investors understand that the label is not what matters; it is the underlying structure. There’s so much noise built into the statistics in B.C. after such a strong run upwards, it’s hard to believe that the real ‘boom’ statistics haven’t hit yet.”

So what accounts for Victoria’s attractiveness for investors?

First, it has a strong, diverse economy. “According to the most recent data, Victoria surpasses the national median income, and boasts one of the highest median incomes in British Columbia at $89,640 compared to the provincial median income of $79,750,” the report reads. “This, combined with affordability, attracts people from Metro Vancouver and beyond.”

Second, it has a growing population. Greater Victoria’ regional population grew by 6.7 per cent between 2011 and 2016 to 367,770, almost two per cent faster than the national average of five per cent. “And this is the real reason behind the strong housing demand and price increases. Greater Victoria’s population is projected to grow by four to five per cent every five years between 2015 and 2025,” it reads.

The report also points to Victoria’s low rental rates as an incentive for investors.

“In conclusion, a strong rental market, a diverse economy, inherent seat-of-government stability, location, relative affordability, and high median income, are key factors that give Victoria an edge over other top towns and cities in British Columbia,” it reads.

Just Posted

Home care complaints up 45% on Vancouver Island

Number of home care hours delivered down 6%, complaints up 45 %

More than 115 people attend UVic blood drive

Canadian Blood Services says UVic is a target location to create lifetime donors

Driver convicted in death of Const. Sarah Beckett granted partial parole

Kenneth Jacob Fenton will be able to attend an alcohol abuse treatment, nearly three years after fatal crash in Langford

Husband of slain RCMP officer ‘disgusted and disheartened’ by parole board

Killer of Const. Sarah Beckett allowed limited day parole for alcohol treatment

Toronto Arrows players take aim at youth rugby clinic

Juan de Fuca team offers get acquainted clinics

UPDATE: B.C. legislature managers accused of excessive travel, personal expense claims

Clerk Craig James, security chief Gary Lenz call allegations ‘completely false’

No cash, no election sign policy pondered by B.C. city

A deposit could be required to put up election signs in 2022.

China demands US drop Huawei extradition request with Canada

China detained two Canadians on Dec. 10 in an apparent attempt to pressure Canada to release Meng

9 brains, 3 hearts: Some wild facts about octopuses

Things to know about the giant Pacific octopus, which is naturally found in the waters of the U.S. West coast, the Aleutian Islands and Japan

Hollywood announces 2019 Oscar nominations

Netflix has scored its first best picture nomination, something the streaming giant has dearly sought

Collapsed floor traps worker at decommissioned North Island pulp mill

Man frees self, escapes injury, investigation underway at Elk Falls facility in Campbell River

Auto shop apologizes after Vancouver Island employees disrespect memorial convoy

Mr. Lube staff members suspended after incident Sunday in Nanaimo

B.C. man fined $10,000 after leaving moose to suffer before death

Surrey man was convicted last week on three Wildlife Act charges

Anti-pipeline group wants NEB to consider impact of emissions, climate change

Stand.earth filed NEB motion asking to apply same standard to the project as it did with Energy East pipeline

Most Read