We experienced some very welcome sunshine and beautiful Fall Colours in the Okanagan this October. Unfortunately, this has done little to brighten the spirits of many Sellers in the Kelowna Real Estate market.
Overall the Real Estate Market felt like it is slowing, which is normal for the Okanagan as we head towards winter, and there is a sentiment that we are moving ever closer to a ‘Buyers Market’, from a ‘Balanced Market’ as prices continue to soften.
Kelowna Real Estate Market Sales October 2018
Interestingly, overall Sales were up 12.5% on last month and down 29.2% on this time last year. Single Family Home sales were down on last month, but Strata Sales rallied up 17% on last month but down 14.9% on this time last year.
It should also be borne in mind that there was a one-off 'spike' in Lot sales, last October, where there was a large number of lots sold off in the Lakestone Development in Lake Country.
To try and get a sense of how much the market is softening, I did a few comparisons for the Kelowna area, which did not include West Kelowna, Lake Country, and Peachland-:
Single Family Homes $450,000 to $700,0000 in Kelowna - the Median Price peaked at $625,000 in March 2018 and is now $586,250 for October 2018 - down 6%.
All Condos in Kelowna - Median Price peaked at $345,125 in April and is now $329,500 for October - down 4%.
All Townhomes in Kelowna Median Price Peaked at $521,500 in August 2018 and in October was holding steady at $517,500.
Looking at the months of inventory available, for the same area-:
Single Family Homes Oct 2017 - 4.48 months Oct 2018 6.6 months
Condos Oct 2017 2.77 months Oct 2018 4.65 Months
Townhomes Oct 2017 1.96 Months Oct 2018 5.9 Months
So, Inventory is up compared to last year, but it is still showing as a largely Balanced Market.
One other interesting bright spot was the most expensive Home sale last month was for $5,150,000, which was a 4456 square foot Lakeshore Home which sold in 51 days.
Market outlook for Kelowna Q3 2018
Last week, I attended the Urban Development luncheon, with Guest Speaker Taylor Pardy, Senior Analyst Economics for CMHC in the Interior and Northern BC.
I was very keen to hear Taylors thoughts on our Market Outlook, and he alluded to several factors that may well affect our Market during 2019.
- An increasing Interest Rate Environment will affect Home Buyers Carrying Costs and Borrowing Capacity.
- Population Growth is slowing.
- Consumer Spending growth is slowing, in line with Housing Activity.
- Commodity Prices are shifting upwards, which is resulting in growing activity in the North.
- Labour is being attracted back to the Prairies as the recession ends.
- Slower inter-provincial migration is impacting demand.
- Intra-Provincial Migration into Kelowna remains strongly positive, as our housings relative affordability makes it attractive.
At this stage, it remains difficult to quantify the impact the Speculation Tax will have on the Kelowna and West Kelowna areas, but we do know what it is going to look like now. See my recent blog article - https://www.trishcenci.com/blog.html/speculation-tax-in-bc-what-we-know-so-far-october-2018-5814304
So that's it for this months update. If you have any specific questions about your own Buying and Selling needs, please do not to hesitate to give me a call or send me an email!