It’s been a wild year so far in real estate. From a blazing hot market in the spring to a government-mandated cool-off, to the housing demand far outstripping supply, it’s hard to tell which way is up some days.
The Okanagan housing market has seen a downward trend in housing prices after all the hoopla earlier this year and is expected to continue, at least for a bit.
Thanks to the recent interest rate increases, listed home prices have decreased across Canada. That’s not to say everything became magically affordable overnight, but it’s more realistic than the overheated market we saw earlier this year.
According to a recent report, RE/MAX is predicting a 6.5% drop in housing prices in the Central Okanagan this fall. This is among the larger drops in the country, only being exceeded by four other cities: Peterborough and St. John’s at 7%, Winnipeg at 8%, and Barrie at a 10% drop.
Meanwhile, Metro Vancouver is only expecting a 3% drop, and Victoria housing prices are predicted to stay the same.
But Don’t Get Too Comfortable!
While prices are dipping, they aren’t expected to stay dipped for long. Experts say this drop is going to even out through the fall and winter, likely going back up in 2023.
According to the Association of Interior Realtors, the benchmark price of a single-family home in Kelowna as of August 31 is $1,018,000, while a townhouse goes for $772,700 and a condo is $526,700.
Kelowna has a strong economy, especially when it comes to development and growth. People are moving to the city from all over the world because Kelowna is a great place to live, work, and play, whether they want to start a business or simply live the Okanagan lifestyle.
However, the housing supply is still very low, and prices will start to climb again as the demand continues to grow. This has been an ongoing issue within Kelowna. According to RE/MAX’s Fall 2022 forecast, the low housing inventory “is expected to place upward pressure on home prices in 2023 and beyond.”
There are multi-family developments in the works to try and address the lack of supply, but it will be some time before they’re on the market. So if you’re a buyer wondering if you should wait and see if prices drop even further, you might want to be mindful that prices are expected to go up again.
Record Low Sales In July
Before the price drop in August, July saw the third-lowest sales of single-family homes in Kelowna in 30 years!
Only 124 single-family homes sold in July; the only times before then that sold less in a single month were 121 homes sold in 1994 and 105 sold in 2010.
Part of this is due to the limited supply of single-family homes on the market. Only 1,100 were listed in July, which doesn’t give many options for those looking to buy a new home after selling their old one. It can make folks hesitant to sell when there’s no promise they’ll be able to buy.
However, the market for townhomes and condos seems to be holding steady; as prices climbed earlier this year, townhomes and condos were at a lower price point, and for many buyers, that was more appealing.
Where Do We Go From Here?
Are you a buyer looking to get in on the price drop? Or are you a seller wondering what your options are?
The Mayne Brothers have 40 years of combined experience in the Kelowna real estate market and have seen it all. Whether you’re buying or selling, they can help guide you through the process and do what’s best for you and your situation.
For more information, call 250-860-0303 any time, day or night.