Real Estate prices are a popular subject in the Central Okanagan these days, and whether price increases are going to continue. In a bid to keep you up to date, this post gives the latest Housing forcast from the BC Real Estate Association.
Strong economic conditions in the Thompson-Okanagan are consistent with overall BC Provincial Economic Performance. Kamloops and Kelowna have increasingly diversified economies that support population growth, rising employment levels and new construction activity, according to the Bc Real Estate Association (BCREA).
Economic Growth – Thompson / Okanagan.
Employment growth in business services, construction and tourism has been particularly robust. While a favourable exchange rate benefits BC exporters, it is also causing an increase in tourism-related activities from international visitors and from Canadians choosing to spend their vacation dollars at home.
Note- this was before the Flooding issues hit the Central Okanagan this year, so we do expect this to have some impact on Tourism in the early Summer.
Net migration to the region has returned as a key population growth component after a significant decline in the post-recession period. Both migration from other provinces and from within British Columbia are bolstering the region’s population and adding to housing demand. While the proportion of homebuyers in the Okanagan Mainline Real Estate Board area originating from Alberta has declined since 2014, there has been an offsetting increase in activity originating from Metro Vancouver. The Thompson-Okanagan region’s relative affordability, employment opportunities and retirement lifestyle are significant drivers of migration and overall population growth.
Residential Real Estate Sales Performance.
MLS® residential sales through the Okanagan Mainline Real Estate Board have eased from the record level recorded a year ago. However, consumer demand remains at an elevated level, and home sales are expected to post the second best performance on record this year. In the South Okanagan, housing demand is on pace to match last year’s record level, with 2,450 units sold. Meanwhile, housing demand in the Kamloops area is also expected to remain robust this year, with 3,150 units trading hands. Condominiums have been in high demand across the Thompson/Okanagan region this year. Consumer demand for apartments is expected to rise nearly 26 per cent in the South Okanagan and 8 per cent in the Okanagan Mainline areas.
Real Estate Market Conditions Thompson Okanagan
Market conditions in the region have continued to tighten this year. Strong consumer demand has drawn down the inventory of homes for sale and created more intense competition among homebuyers. Total active listings on the market in May were down nearly 28 per cent in Kamloops, and 16 to 19 per cent in the Okanagan boards, compared to the same month last year. While tight supply conditions have induced home builders to ramp up new construction activity, the number of newly-built and unoccupied units remains low. As a result, the total stock of homes is undersupplied in the face of current consumer demand, at least in the near term.
In addition, housing starts climbed 33 per cent in Kamloops and 72 per cent in both Okanagan boards areas last year. This activity has likely absorbed a significant amount of developable land. Combined with some capacity constraints for home builders, this is expected to limit new home starts this year.
Because of these factors, the average residential price is expected to continue an upward trend this year across the Thompson-Okanagan region, with apartments in the Okanagan Mainline area and townhouses in both the South Okanagan and Kamloops experiencing most significant gains. The relative affordability of the region continues to underpin demand. However, while the typical monthly carrying cost is still below the highs recorded in 2008, relative affordability has eroded over the last 24 months.
If you would like more specific information about your own local Real Estate Market within the Central Okanagan Area, please do not hesitate to contact us as we wil be happy to help!
Trish and Tanis Real Estate
Source: Home Sales to exceed 100,000 for Third Consecutive Year | BC Real Estate Association