The heat is starting to come off the Okanagan housing market.
While the cooling off period announced last month by the provincial government hasn’t come into effect yet, there are other factors that have started to turn down the heat in Kelowna and the surrounding areas.
Why the cool down?
One of the factors affecting the housing market are rising interest rates, as mortgage rates have surpassed 4% for the first time in a decade. This has made some buyers a bit more wary than they might have been before the rates went up, so that definitely contributed to the market cooling.
The amount of inventory available in the Okanagan did go up slightly for the month of April, after seeing a dearth of options a few months prior.
However, people aren’t buying anywhere near the highs of this time last year.
In the Central Okanagan, there were 522 units sold, down 34 per cent from last year. In the North Okanagan, there were 220 units sold, down 32 per cent from last year. In South Okanagan there were 201 units sold, down 33 per cent from last April.
The Association of Interior Realtors (AIR) also said there were 670 homes on the market last month, which was more than double the amount they were seeing in February.
“It is important to remember that this is not the same market we had a year ago. For almost the entire year in 2021 we had record highs each month, so to say sales are down does not mean they are low, they are just lower in comparison to a time of unusual real estate market activity,” says President Lyndi Cruickshank in a press release. “The current rising interest rate environment will naturally slow things down bringing real estate activity back to a healthier market – the transition of which we are starting to see reflected in the number of sales and in the way real estate transactions are transpiring.”
Lack of supply: Still a huge issue
However, there’s still a critical issue of the imbalance between supply and demand. As reported by the Kelowna Capital News, BCREA chief economist Brendon Ogmundson says inventory has never been this low heading into the spring, which is normally the busiest time of year for the real estate market.
“The story of the B.C. housing market is one where we haven’t been very good at getting new supply into the market and then we get caught in times where there’s a real surge in demand,” Ogmundson said. “That’s what causes rapidly accelerating prices.”
What does this mean for you?
Well, with the slight increase in the amount of homes listed, that does give you more options to choose from, meaning you won’t feel as pressured to buy immediately. Plus with the government cooling off period, it’s a slightly less stressful time to buy a home than it was a couple months ago. There won’t be any of that pressure to skip the home inspection or anything just get your office accepted, so you can rest easy in that regard.
As for selling your home, just because the market isn’t quite the hotbed it was the past few months doesn’t mean you’ve missed your chance. There is still a need for listed homes, be they detached, multi-family, townhouse, or condo. Keep in mind that your home could sell very quickly and plan accordingly. There’s still the chance you’ll have multiple offers coming in all at once, but having the right real estate agent will help make it less overwhelming.
Make sure to touch base with a respected realtor to help guide you through the current market. The Mayne Brothers have a combined 40 years experience in the Okanagan housing market and can help guide you through this tumultuous market. Whether you’re buying or selling, you’ll want someone in your corner that will look out for your best interests.
To learn how The Mayne Brothers can work for you, call 1-800-430-5030.