After being away at the end of last month and not writing my usual month end review, there is lots to cover in this months Kelowna Real Estate Report!
In the last few months, we have had a Foreign Buyers Tax imposed in Vancouver, and now changes to the CMHC Lending Rules, so understandably, Buyers and Sellers in the Kelowna Real Estate Market are asking will this affect our market and will prices start to fall?
Certainly, the Vancouver Real Estate Board reported that sales had dropped 38.8% from a year earlier, totalling 2,233, with sales 15% below the 10-year average for October. Single Family detached houses took the biggest hit, down 54.6 % while Condos were down 23.7 %.
Here in Kelowna, certain areas of the market remain very busy. On one occassion, I actually found myself outside a popular Central Kelowna Condo Complex, with clients , 4th in line to view it! In the end, it sold $20,000 over list price!
Central Okanagan Real Estate Sales October 2016
|Date||Total||Single Family Homes||Strata||Lots||Manuf|
As per usual, we did see sales dropping off during October, with total sales down 23%, on last month,with Single Family Homes sales down 18.7% and Strata sales down 14.6%. Compared to this time last year total residential sales are up a creditable 10.6%.
Interestingly, overall listings Year to Date are up 1.98% in the Central Okanagan from 9,225 in 2015 to 9,408 in 2016, but overall Inventory is down 25.05% from 3,098 in 2015 to 2,322 at present.
Median Residential Sales Prices, compared to this time last year, are up 16.88% from $496,250 to $580,000; Condos are up 8.04% from $255,000 to $275,500 and Town Homes are up 5.04% from $358,450 to $376,500.
The number of days Properties are taking to sell is continuing to fall – Single Family Homes from 67 to 50 Days; Condos 80 to 51 Days and Town homes from 79 to 52 Days.
It is still a Sellers Market!
Kelowna Real Estate Market Forecast Fall 2016
During the last week, CMHC published their Fall 2016 Kelowna Housing Market Outlook. It gave us great insight into their predictions for the next couple of years, for our local Real Estate Market.
Some of the highlights were-:
- New Rental Starts in 2016 are not expected to meet the current demand, resulting in a further decline in the vacancy rate to 0.5% although this is forecst to rise to 1.5% in 2017 and 2% in 2018.
- Steady population growth,will add to stable demand for new homes through to 2018. This will particularly be a case around the UBCO area with continued rising demand from incoming students.
- The migration of Young Professionals, Retirees and Seniors will continue the demand for multi unit starts, as it is forecast that’s a number of these migrants will rent first. 46% of all multi unit starts in the first 8 months of 2016 were rental units.
- The results of new construction of both Rental and Condo multi units, is expected to dominate construction over the next two years and be above the 10 year average in 2017.
- Within their resale MLS® predictions, CMHC, reported that Kelowna’s saw record pace sales the first 8 months of 2016, caused by population growth and low interest rates. This resulted in sales levels above the 10 year average and they are only predicting a slow moderation’ in 2017 and 2018.
- The re-sale numbers they are showing are 2016 – 6500- 6900 2017 – 5520 – 6290 – could fall 17.7%. 2018 – 4820 – 5890 – could fall 14.5%
- The Average Residential Home price rise is 4% in the first 8 months of 2016, and they are forecsting the following potential average prices- $491,100 – $498,900 in 2016; $516,400 – $533,600 in 2017 – up 5%; $522,500 – $547,500 in 2018 – up 1%
CMHC overall assessment of the Kelowna Economic Outlook
- The low Canadian Dollar, population growth and recovering employment levels, to support the Kelowna economy.
- High Tech industry growth and a low Canadian dollar are likely to support Tourism, Accommodation and the Food services Industries.
- In the public sector that has been investments in the new RCMP building, Interior Health downtown and the expansion of Kelowna General Hospital. This is great news overall for Kelowna, as it helps to solidify us as a major service centre.
- We are also seeing the major infrastructure upgrades with new roads, such as, between Highway 33 and UBCO, Renewable Energy projects, large Commercial and Residential projects downtown and a further expansion of the Airport.
So what are the positive and negative risks to the Kelowna Real Estate market outlook?
- The continuation of lower Interest Rates, strong population growth and increasing numbers of Buyers from the Lower Mainland, will continue to exert pressure on house prices to rise, particularly with inventory so low.
- The threats to prices, are a fall off in demand caused by slower Employment recovery, reduced numbers of Buyers from the Lower Mainland as the Market there softens and the impact of the recent Mortgage Rule changes.
Well, that’s it for this month.
Don’t forget to put your Clocks back this Sunday!
If you have any specific questions about your own home, please do not hesitate to call or email us, and please feel free to share this information with friends and family!
Trish and Tanis Real Estate
Tel 250 863 8989