Monthly Housing Market Update
Caleb's Perspective on the Market
The September sales statistics are in—and they aren't pretty. After showing some encouraging signs of strength in August, the Victoria real estate market slowed considerably in September. Sales dropped, prices softened, inventory climbed, and two of the indicators I watch most closely moved firmly into buyer's market territory. Let's dig into what happened—and, perhaps more importantly, why.
Sales Took a Step Back
There were 438 residential sales in September, a decline of 16.9% compared to the same month last year. But weak sales weren't limited to one particular segment of the market. Sales are now running below the 10-year average across all three major housing categories: single-family detached homes, condos and townhomes. Prices softened as well, with median prices across all three categories declining by at least 1% compared to September of last year. Those numbers certainly aren't encouraging, but what really caught my attention this month was how quickly the overall market deteriorated.
Months of Inventory Jumps to Nearly 7
If you look at the chart above, you'll see that residential months of inventory jumped to almost 7 months in September. That's the highest level we've seen since the pandemic lockdowns and a stark departure from the relatively stable market conditions we've experienced over the past year. For context, months of inventory had been hovering between 4-5 months for much of the spring and summer. A move from less than 5 months to nearly 7 in such a short period is significant. It's one of the clearest indications that the balance of power shifted toward buyers in September.
Residential Sales: 438Down by 16.9%
Less Than One in Three New Listings Sold
The sales-to-new-listings ratio tells a similar story. If you look at the chart above, you'll see that September recorded the lowest sales-to-new-listings ratio for any September over the past four years. Less than one out of every three new listings sold during the month, while only approximately one out of every seven active listings found a buyer. With homes coming onto the market considerably faster than buyers were purchasing them, total residential inventory increased further. Put all of these numbers together, and September landed the Victoria real estate market squarely in buyer's market territory.
Median Condo Price: $517,500Down by 4.1%
So, What Happened?
I believe interest rates are an important part of the story. As I've discussed in previous updates, the real estate market is highly sensitive to changes in borrowing costs. And if you look at the bond yield chart above, you'll notice that the Government of Canada 5-year bond yield began climbing in August and continued moving higher throughout September. This matters because 5-year Government of Canada bond yields are an important influence on fixed mortgage pricing. As bond yields rise, fixed mortgage rates generally face upward pressure. Higher mortgage rates reduce purchasing power. For example, a buyer who qualified for a certain mortgage a few months ago may qualify for less today—even if their income and financial circumstances haven't changed. And when affordability is already stretched, relatively small changes in borrowing costs can have a noticeable impact on buyer activity.
Median SFD House Price: $1,140,000 Down by 1.3%
One Month Doesn't Make a Trend
This is probably the most important point in this month's update. September was one month. The numbers clearly deteriorated, and I'm not going to sugarcoat them. But one month of data isn't enough to conclude that Victoria has entered a prolonged buyer's market. Remember, only one month ago we were discussing August's 13.4% year-over-year increase in sales and signs that inventory was beginning to plateau. That's how quickly the picture can change. September could be the beginning of a broader shift—or it could prove to be an unusually weak month that looks very different once we have October and November's numbers. For now, I'll be watching sales, inventory, mortgage rates and the sales-to-new-listings ratio particularly closely. The next couple of months should give us a much better indication of whether September marked a genuine turning point or simply a statistical anomaly. And as always, I'll be back next month to break it all down.
Until then, have a wonderful Thanksgiving and a Happy Halloween!
Months of Inventory: 6.7= Buyer's Market
Victoria Real Estate Market Report for September 2026
October 1, 2026 A total of 463 properties were sold in the Victoria Real Estate Board region this September, 16.4 per cent fewer than the 554 properties sold in September 2025 and 21.7 per cent fewer than August 2026. Sales of condominiums decreased by 11 per cent from September 2025, with 137 units sold. Sales of single family homes decreased by 17.3 per cent from September 2025, with 239 sold.
“September closed with inventory levels outpacing sales to a degree we haven’t seen in many years,” said Victoria Real Estate Board Chair Fergus Kyne. “The numbers indicate that the Victoria housing market has ventured into buyer’s market territory. Excluding the months from the start of the pandemic, this is the first time we’ve seen a buyer’s market since January 2015. However, one month does not make a trend, and it’s too early to say whether market conditions have shifted for the longer term. We’ll be watching the data closely over the coming months to see whether this is the beginning of a trend we haven’t experienced in more than a decade.”
There were 3,811 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of September 2026, an increase of 4.1 per cent compared to the previous month of August and a 3.2 per cent increase from the 3,694 active listings for sale at the end of September 2025.
“There is a strong supply of inventory available in our market right now,” notes Chair Kyne. “But there is also a lack of certainty in many other aspects of our lives that may be contributing to lower sales activity. If you’re a qualified buyer and you’re looking for a new home, this might be a good time, because inventory generally decreases into the winter and your choices may not be as diverse as they are right now. For sellers, it’s important to have a conversation with your REALTOR® about the current market value of your specific property and how your expectations align with today’s market conditions in your market segment. September’s market looked very different from July and August, and conditions could shift again in October and the months ahead. That is why advice from a trusted local REALTOR® is so valuable when navigating a dynamic marketplace.”
The Multiple Listing Service® Home Price Index benchmark value for a single family home in the Victoria Core in September 2025 was $1,306,500. The benchmark value for the same home in September 2026 decreased by 2 per cent to $1,280,100, down from August’s value of $1,301,800. The MLS® HPI benchmark value for a condominium in the Victoria Core area in September 2025 was $542,200, while the benchmark value for the same condominium in September 2026 increased by 1 per cent to $547,800, down from the August value of $553,600.
View our press release and summary here.
View our complete statistical package here.
Notes for Interpreting Our Statistics
The use of sale price statistics can be useful in establishing trends when applied over a period of time, i.e. six months or longer. The Victoria Real Estate Board cautions, however, that such information does not indicate the actual value of any particular property. Those requiring specific information on property values should contact a REALTOR®.
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Courtesy of the Victoria Real Estate Board
Interpreting the Stats
I believe that one of the best indicators to gauge the current real estate market is the sales-to-active listings ratio. Instead of just focusing on the number of sales we have in a given month, the sales-to-active listings ratio expresses the number of sales as a percentage of the active listings that are currently available for sale. In other words, current levels of demand relative to current levels of supply. For example, if we had a sales-to-active ratio of 50% this would mean that in the entire Victoria Real Estate Market we would have just 2 months of inventory for sale. In other words, if this level of sales were to continue, it would take only 2 months to sell all of the remaining listings on the market.
What does this mean for prices? Well, generally, less than 4 months of inventory indicates a seller's market with prices increasing more the lower that this number goes. On the other hand, more than 6 months of inventory generally results in a buyer's market with prices dropping. The longer the trend remains, the stronger the correlation to price increases/decreases. Interest rates, new building starts, wages and the state of the economy all have an effect, but essentially it is the amount of demand relative to inventory available for sale that drives the market.
- Caleb Mickelson