Over the last four years, Alan Watts has watched the assessed value of his Mayne Island property plummet by more than a third.
In the latest valuation from B.C. Assessment, his 1,000-square-foot inland home is valued at just $188,100. That marks a drop of 12 per cent in the last year alone.
“It’s ridiculous,” he said.
All of his neighbours along Waugh Road have seen their values plunge by three to 10 per cent from last year’s assessments, and Watts thinks he knows why.
“Do you think it has anything to do with the ferries?” he asked facetiously.
Real estate values on some southern Gulf Islands began falling with the financial crisis in 2008 and haven’t stopped since, according to residents and realtors. They suspect that rising ferry fares and decreased service are playing a big role in that trend.
It now costs about $135 to make the typical peak-time return trip with car and driver from Metro Vancouver to Galiano, Mayne, Pender or Saturna islands.
Meanwhile, B.C. Ferries is eliminating Wednesday sailings from Tsawwassen to the southern Gulf Islands for the next nine weeks, a move that was made in order to avoid cutting weekend service.
“All our businesses over here are getting killed. People aren’t coming like they used to,” Watts said.
Mayne Island real estate agent Glen McLeod said he’s seen typical real estate prices fall 30 to 40 per cent over the last five years.
“Our waterfront values have slipped by a decade, I would say. I’m looking at some prices that we saw 10 years ago in the Gulf Islands,” he said.
“I have no problem in blaming it on B.C. Ferries. Other factors have been at play, but the biggest one is B.C. Ferries.”
Small waterfront homes that might have sold for $450,000 or more a few years back are bringing in less than $400,000 today.
But even if prices are falling, sales volumes are going up. Forty-two properties on the island sold in 2014, a seven-year record.
“Despite B.C. Ferries, the magic is still here,” McLeod said. “It’s really special, and that holds through the economic calamity and the deflation of value.”
On nearby Saturna Island, a one-and-a-half-storey home on a waterfront lot along Cliffside Road was valued at $663,000 in 2014. This year, it was assessed at $603,000 — a nine-per-cent drop in value.
Nearby properties have seen their assessments drop by as much as 19 per cent in the last year.
Real estate agent Susanne Middleditch said her firm recorded only three sales over $500,000 in 2014 on Saturna Island. She’s in the process of closing on sales of two waterfront cottages that would have brought in as much as $700,000 at the height of the market in 2008, but ended up selling for just over $500,000.
“We’ve been in a declining market since 2009,” she said.
She believes that a number of factors are at play in that decline, including a decrease in American visitors since the financial crisis. However, uncertainty about the future of ferry service to Saturna is a major concern for buyers.
Middleditch points out that fares and frequency of sailings aren’t the only problems with ferry service to the islands. Logistics can also be an issue.
Sailing to the Gulf Islands from the Lower Mainland midday during the week requires making a transfer in Victoria, but the schedule is such that travellers must choose between spending five hours commuting or risking an almost impossibly tight 20-minute turnaround between arrival and departure at Swartz Bay.
“If B.C. Ferries could just give us a solid transportation system,” Middleditch said. “It’s the cost and the uncertainty and the instability.”
Spokespeople for B.C. Ferries and the transportation ministry said no one was available to comment Sunday.
