For those of you who have not read one of my Quail Ridge / University Real Estate Blogs before, my name is Trish Cenci, and I am a Real Estate Agent in Kelowna, who specializes in buying and selling Real Estate in the Quail Ridge and University District of Kelowna.
This post is my annual report on what has happened in this area of the Market during the last year and some of my predictions for 2019.
Total Quail Ridge / University District Real Estate Sales for 2018
After 2 'banner' years of Real Estate Sales in the Kelowna area, there was a 36% fall in Quail Ridge / University MLS® Residential Real Estate sales in 2018.
Interestingly, sales of Single-Family Homes increased, but Condo sales fell 29% and Townhomes a whopping 93%!
Single Family Homes
Of the 24 sales in the Quail Ridge / University area, 17 were under $800,000, which represented great value, compared to some other areas of the City and contributed to the areas increase in sales numbers.
We continued to see a shift from Empty Nester buyers to a mix of Empty-Nesters and Families.
The City is now looking more favorably on 'Suites' in Homes, due to the proximity to UBCO, which some owners have elected to do and this has proved to be a useful Mortgage-helper to some.
The new University Heights Development is now really taking shape and many of these homes also have the option of a legal suite.
The opening of John Hindle Way, in September 2018, which now links the Quail Ridge / University area to Glenmore was a welcome addition and takes about 5 minutes off a journey into Kelowna!
The 2018 Quail Ridge / UBCO Condo sector was affected by the changes to the Mortgage rules with the introduction of the Mortgage Stress Test.
Normally, complexes such as The Pointe at Quail and Pinnacle Pointe, we see 2 bedroom and den condos as being the most popular with Buyers, but in 2018 many had a cap of 'under $400,000' and most of these units were listed in the $415,000 to $450,000 price range.
This forced some of my Buyers to look at cheaper options, in complexes such as The Verve, in Glenmore and various complexes in Rutland.
In Pinnacle Pointe the selling price ranges were -:
1 Bedroom - $283,000 to $298,000
2 Bedroom $336,000 - $383,000
2 Bedroom and Den $390,000 - $420,500
In the Pointe at Quail -:
1 Bedroom $275,000
2 Bedroom $355,000 - $377,000
2 Bedroom & Den $372,480 - $441,000
Prices and sales in the Pointe were subdued, as the complex was waiting to hear about the cost of Engineering work that will need to be undertaken. A special levy has now been announced and it is hoped that the work will be completed in 2019.
In Academy Way, sales held steady at 21 sales, as well as the Developer Sales in U Six and U Seven.
U Eight is due to be launched in January 2019, and the Mission Group are reporting high levels of interest, despite the downturn in the Kelowna Real Estate Market in general.
In the Academy Way area selling price ranges were as follows -:
1 Bedroom $205,900 - $275,500
2 Bedroom $382,500 - $430,000
3 Bedroom $434,900 - $529,000
There was 1 sale in Academy Hill, 4 in U One, 9 in U Two, 2 in U Three and 5 in U Five. Sales for U Six and U Seven have not started to show on the MLS® system yet.
Average Days on the Market for Condos is rising -:
2016 - 49 Days
2017 - 33 Days
2018 - 48 Days
This does not reflect that some of the Condos were re-listed, and so the average Days on Market should only be regarded as an increasing trend when the actual days to sell will be higher.
The most affected area of the Quail Ridge and University market was townhomes.
Only 1 sold in the Bella Sera complex, at 1795 Country Club Drive, and 1 in Fairway Heights, on 2455 Quail Ridge Boulevard.
Compare this to Bella Sera in the recent past 2016 - 10 Units 2017 14 Units and Deerhurst Estates, on Vint Road, in 2016 5 units and 2017 13 Units.
Vint Road was newly built complex, so I would not expect so many sales, but Bella Sera definitely had a disappointing year, as buyers became less willing to pay over the $450,000 mark.
There are currently 8 Townhomes for sale in the area. 1 1/4 share in Bella Sera, 3 Full Ownerships in Bella Sera, 1 in Vint Road and 3 in various complexes on Capistrano.
There were Townhomes for sale in a variety of complexes during the year, which didn't sell, and I suspect one of the reasons for less activity and indeed some Owners reason for selling was the Speculation Tax announced by the Provincial Government which would affect empty 2nd Homes.
A word of caution about Assessed Values
The City of Kelowna has just advised owners of the Assessed Values they will be using to calculate City Taxes this year.
These values should not be used as an accurate guide to home values in the area. Firstly, they are based on values as of July 2018, since which time prices have fallen and secondly, values have often been difficult to assess in this area as there are a lot of custom-built homes.
For example - a Bella Sera Townhome, in Country Club Drive, in 2018 was assessed at $380,000, in $2019 it is assessed at $406,000 and the actual sale price during the 2018 year was $444,000.
If you are buying in this area, I strongly recommend that you work with a Real Estate Professional who is familiar with the area and will undertake a full Market Analysis of the property you are looking to buy and make allowances for age, style, finishing, and view, etc.
Quail Ridge / University Real Estate Forecast for 2019
BC Economists, such as Bryan Yu at Central 1 Credit Union feel we are in a mild recession, which has been Policy Induced.
The combination of the Mortgage Stress Tests, the threat of increased interest rates, slightly softer Rental Rates, the introduction of the Speculation Tax, Foreign Buyers Tax, subdued Real Estate Markets in Alberta and the Lower Mainland and the great difficulty in getting money out of China, are all likely to have an effect on ongoing demand and hence pricing of Homes in the Kelowna Area.
Since the middle of 2018 prices have generally softened by about 10% in Kelowna.
How will this affect the Quail Ridge and University areas in particular?
The Stress Test and Interest Rates will affect some Parents who are looking to buy a Condo for their Children attending UBCO, so I expect this to continue to affect how much they can spend,1 bedroom and den and 2 bedroom condos are likely to be in higher demand than 2 bedrooms and den in Quail.
The Speculation Tax may persuade a few more homeowners in Quail Ridge to sell if they use these homes as second homes, and they do not rent out.
The Foreign Buyers Tax and difficulty getting money out of China may affect some Buyers of Condos, particularly in Academy Way, as these have been very popular with Asian Parents as the Children do not need cars, and they can walk to school.
Softer Rental Rates may affect some investors of both Quail Ridge and Academy Way Condos as the return they receive may not be as attractive. It should, however, be noted that although Vacancy Rates are predicted to rise during 2019, it will not be significant.
Inventory - I am expecting the level of inventory to be average this year. Most owners who wanted to cash-out did so in the last couple of years. It will continue to be a Buyers Market and sales during the winter will be slow, which is normal in this area.
Prices - will continue to be 'soft' into the spring, but I predict many Sellers will come to a point where they would rather take their property off the market and wait rather than sell too low, so, at that point, prices are likely to start to stabilise.
In summary, it is going to be a better year for Buyers in 2019, and Sellers will need to be 'mentally tough' as there are likely to be fewer showings, homes will take longer to sell and staging and presentation will also be important.
If you have any specific questions your home or are looking to Buy in the area and are looking for a Quail Ridge / UBCO specialist, please feel free to call or email me and I will be happy to help!
Tel 250 864 1707