NANAIMO, B.C. – 2020 was a strange year to say the least for most people. Without question the Global Pandemic has impacted how we socialize, work and go about our daily lives. Impacts have been felt across many sectors of our economy from international trade, small and local businesses, restaurants and tourism are just a few examples. Initial predictions for the Real Estate Market “post spring lockdown”, was of an anticipated slow down. Potential for a decline in values and fear of an increase in the number mortgage defaults, created a lack in overall consumer confidence. Although these predictions seemed to be consistent in the early stages of the pandemic, it wasn’t before long the Real Estate Market bucked the trend and began plotting its own course.
Several factors began to put unforeseen pressures on our local markets. The high demand for Real Estate here in Central Vancouver Island was seemingly spurred on by the pandemic. We began to see an exodus from high density regions such as the lower mainland, urban centers in Alberta and a steady flow of retirees and snowbirds from the east. Compounded by historically low interest rates making for ideal lending conditions, first time buyers and investors began jumping back into the market seeking opportunity.
While the demand for Real Estate has continued to increase since early summer 2020, people who were willing to sell their homes and make transitions during such uncertain times and market volatility began to decline. Not only because of the pandemic, but where would they go or what would they buy seemed to be a common theme.
With high demand out-pacing new inventory, the already low inventory levels here in Central Vancouver Island began to decline further. It wasn’t long before we began to see a divergence in Real Estate values and an imbalance in our local market. High levels of competition for new listings became common towards the end of 2020 with competing bids and multiple offers on popular properties.
Limited supply and high demand in the back half of the year put upward pressure on Real Estate values. For single family homes in 2020, Nanaimo saw a 10% reduction in new listings, a 12.9% increase in volume sales and a 9.7% increase in the average price of a single-family home to $616,000.