Monthly Market Update
Monthly Market Update
February 2025
Victoria's 2025 Housing Market Begins with Balanced Inventory and Stable Pricing
The 2025 housing market in Victoria has kicked off with a favorable balance of inventory and stable pricing, setting a positive tone for the year ahead. Over the course of January, the market experienced a notable uptick in new listings. In fact, for the first time in a decade, over 1,000 new listings were added to the inventory in a single January. This surge in listings is an encouraging indicator of market stability as we move further into 2025.
At the end of January 2025, there were 2,395 active listings on the Victoria Real Estate Board Multiple Listing Service® (MLS®), reflecting a 4.6% increase from December 2024 and an 11.9% rise compared to the 2,140 active listings recorded at the end of January 2024. These figures highlight the continued movement towards a balanced market in the Greater Victoria area.
Sales Trends and Market Momentum
Total sales in Greater Victoria for 2024 surpassed the previous two years but still fell below the long-term average. Despite this, inventory levels at year-end were at their second-highest point in the past decade.
Encouragingly, for the sixth consecutive month, sales in January 2025 outpaced those of the same month in the previous year. This ongoing trend aligns with the Bank of Canada’s rate-cutting campaign, which began in June 2024.
In December 2024, sales saw a significant year-over-year increase of 30%. Detached homes led this surge with a 34% rise in sales, followed by townhomes at 32% and condominiums at 28%.
Interest Rate Outlook and Economic Considerations
Canada recently received a temporary reprieve from U.S. tariffs for at least 30 days. However, if these tariffs are enacted, the Bank of Montreal (BMO) has warned that the Bank of Canada may need to cut its policy rate to 1.50% by year-end. This would mark a full percentage point reduction from BMO’s current forecast of 2.50% by late 2025. Originally, U.S. tariffs were set to take effect immediately, imposing a 25% duty on most Canadian goods and a 10% duty on oil and gas. However, President Trump announced a last-minute 30-day delay, extending a similar agreement previously made with Mexico. BMO economist Michael Gregory has suggested that if these tariffs do proceed, a more aggressive rate-cutting strategy may be required.
Pricing Trends and Market Outlook
Despite broader economic uncertainties, home prices in Victoria have remained relatively stable. The MLS® Home Price Index (HPI) benchmark value for a single-family home in the Victoria Core rose by 2.8% year-over-year, reaching $1,287,200 in January 2025, though this was a slight decline from December’s value of $1,306,400. Condominium prices in the Victoria Core saw a slight 0.7% decrease from January 2024, settling at $548,100, yet still showing a modest rise from December 2024’s value of $547,800. A total of 422 properties were sold in the Victoria Real Estate Board region in January 2025, representing a 23.8% increase from January 2024’s 341 sales and a marginal 0.2% rise from December 2024. Condominium sales showed strong growth, increasing by 30.4% year-over-year, with 146 units sold. Similarly, single-family home sales rose by 19.8%, with 194 transactions recorded.
Moving Forward
The market has seen a strong handoff from December into January, carrying momentum into the early months of 2025. Inventory levels are higher than in recent years, interest rates remain favorable, and pricing has remained largely stable. However, potential uncertainties in international trade relationships could impact market conditions in the coming months. Market participants will closely monitor these developments to assess their long-term effects on the housing landscape in Victoria.
Sincerely,
Michele, Mark and Eric
