There were 781 properties sold in Greater Victoria last month, up from 704 properties sold in September of last year, that is an increase of 10.9%. Although it is a lower increase than previous months this year that is most likely due to the very low inventory. We currently have less than 2,000 active listings on the Victoria Real Estate Board Multiple Listing Service®, which is around 40% less than we had available at the same time last year and the lowest inventory on record since 1996. With recent Government changes we are still seeing a hot housing market in Victoria and multiple offers on single family homes, townhouses and condos, with sales over the asking price.

At the beginning of the month Finance Minister Bill Morneau announced some big changes that were aimed at slowing Canada's housing market, one of those was the stress testing for mortgages that came into effect last week. As of October 17th, 2016 any purchaser with less than 20% down (high ratio mortgages) must go through "stress testing". A current 5 year fixed term interest rate with the bank is 2.59%, high ratio mortgages will still get this interest rate but with the stress test you will be qualified at the Bank of Canada's posted rate which is currently 4.64%. What that means is the purchase price you qualify for with the stress testing is about 20% less than at the current interest rates.

The graph below shows the changes in the Home Price Index benchmark values for single family homes, townhouses and condos in the Victoria Core from September 2015 to September 2016.