May 9, 2025 - While sales were down slightly this April compared to April 2024 (-5.3%), we are seeing the impact of some pent-up demand with multiple offers occurring as our spring market progresses.
The condo market in Greater Victoria has experienced pressures due to the B.C. government implementing regulations on short-term rentals (“STR”). Sales of condos declined 10.1% in April 2025 compared to April 2024. Many owners of STR condos have tried to sell rather than take on long-term tenants, and the core area of Victoria has experienced social challenges, which have also slowed this market down.
The B.C. Housing Minister, Ravi Kahlon recently confirmed this trend when he stated that properties previously on STR websites are now on the market or being used as long-term rentals. STR landlords had until May 1st to register their properties. Kahlon stated that, “before the registry was launched, we estimated roughly about 22,000 short-term rentals were on the different platforms. We have 15,000 that are registered to date.” That means that about 7,000 operators either haven’t applied or perhaps have decided not to stay in the business of STR operating.
Numbers published by the website rentals.ca show average rent in B.C. was down 0.6% year-over-year in March, based on listings posted on the site.
In February, The Canada Mortgage and Housing Corporation forecast that while B.C. would see higher vacancy rates over the next few years due to lower population growth, average rents would rise as new higher priced units come to market.
Brendon Ogmundson, chief economist for the B.C. Real Estate Association, said while the government’s goal of increasing housing supply is understandable, the rules may have done more harm than good overall, considering the impact on tourism. He said decreases in rents have more to do with factors like new units hitting the market and population growth falling, particularly among groups with high demand for rentals, such as international students and temporary foreign workers.
As for buyers, Ray Macklem from Nest Mortgage says, “a lot of the big pressures that have kept people on the edge, are now easing:
The Canadian election is now behind us, with a focus now on strengthening the economy: cutting taxes, investing in infrastructure, diversifying trade and expanding housing.
Trade tensions are cooling. President Trump is softening on tariffs as pressure mounts at home, with US industry and voters pushing back against policies dragging their economy down.
Inflation has steadied close to the 2% target since August 2024. A stronger Canadian dollar, lower energy prices, the end of the carbon tax, and slowing demand are all helping to keep things in check.
Interest rates have dropped sharply from their peak – and affordability continues to improve as a result.”
Macklem suggests that now is the time to purchase.
In April we saw 4 sales in the Greater Victoria Real Estate Board area recorded over $4M. There is evidence of more activity in the luxury real estate market as more out-of-town buyers choose Victoria as their home.
We wish all mothers a special day of recognition this Sunday!