Market Conditions - January 2025
Strong December Sales Signal Positive Momentum
The BC real estate market closed out 2024 on a high note, with strong December sales setting an encouraging tone for the start of 2025. This robust finish to the year strengthens the emerging signal of a turning point in market conditions.
Sales Activity Indicates Growing Buyer Confidence
Provincial home sales saw a 24.7% increase compared to December 2023. While still 15% below the ten-year December average, the strong finish helped push total 2024 sales to slightly higher than the 2023’s total. This year-end surge suggests growing buyer confidence and sets a positive trajectory for early 2025.
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Inventory Accumulation Slowing
Active listings were up 16% compared to December 2023, but down 20% compared to November. The combination of stronger sales activity and the typical seasonal declines in new listings has helped moderate inventory accumulation.
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Balanced Market
The market remains well-balanced, as it was throughout most of 2024. December offered stable market conditions that favour neither buyers nor sellers excessively. This balance has been instrumental in maintaining price stability throughout the year.
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Boost in Prices
There was a boost in average home prices in December. Prices were 5.6% higher compared to December 2023, and 3.5% higher compared to November. For the full year of 2024, the average home price only increased by a modest 1.1% compared to 2023, due to remarkably stable prices for most of the year.
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Falling Interest Rates
The Bank of Canada maintained its decisive approach to monetary policy with another significant rate cut in December, lowering the overnight policy rate to 3.25%. This marks The Bank’s second consecutive jumbo rate cut. Their next rate announcement will be on January 24th and while they may not continue the pattern of extra-large cuts, experts believe that a cut is still likely.
Looking Forward
The combination of strong sales momentum, balanced market conditions and more favourable financing conditions creates an optimistic outlook for early 2025. The market appears well-positioned for sustained stability and increased activity.
Opportunities for Buyers
- Relatively high inventory levels providing more choice
- More accessible financing with recent changes in mortgage rules and lower interest rates
- Prices reasonable after a long period of little change
- Balanced market conditions supporting fair negotiations
Opportunities for Sellers
- Strengthening sales activity
- Prices are showing signs of increase after a long period of little change
- Balanced market conditions supporting fair negotiations
- Expanded pool of qualified buyers due to lower interest rates and new mortgage rules
The market's strong finish to 2024 suggests we're entering 2025 with positive momentum. Whether you're considering buying or selling, these conditions offer opportunities worth exploring. For personalized advice about your specific situation, don't hesitate to reach out.
Gina Jacobsen, PhD
REALTOR®
(250)539-0828
gina@ginajacobsen.com
Sources:
British Columbia Real Estate Association Economics
Victoria Real Estate Board MLS® STATISTICS
Canadian Real Estate Association
Bank of Canada