Impact of the Pandemic on the Kelowna Housing Market

Posted by Dave Kotler on Friday, July 9th, 2021 at 10:45am.

Impact of the Pandemic on the Kelowna Housing Market

The coronavirus pandemic has sent shockwaves throughout the globe affecting every aspect of our economy. Not only that, it’s lasted so long that it’s starting to have long-term effects on our lives. As changes become permanent and people start to adapt, the structure of our economy has been transformed. It’s no shock that the Kelowna housing market has also drastically changed and it’s time to reevaluate your options.

Changing Home Preferences

People often overlook the beautiful city of Kelowna as a permanent place to live because it’s often overshadowed by the largest city in British Columbia, Vancouver. Even with Vancouver’s exceedingly high home prices, people are forced to live in the urban city for their careers and work opportunities. However, with several province-wide restrictions being issued, the in-office business model has been uprooted. People are now able to and actually being encouraged to work remotely. This means that people can work for their companies from anywhere they want. It’s no longer a necessity to live in a highly populated city with expensive and urban homes.

Leaving Vancouver

Over the past year, Vancouver has seen a 52% increase in units sold, but prices have only slightly increased, which indicates that people are selling their Vancouver homes. Not only can you get a better deal elsewhere with nicer scenery and more activities, but you also avoid BC empty home tax. If you don’t sell or rent an unoccupied home, you could be stuck paying thousands of dollars. In 2021, the Vancouver empty home tax was more than doubled from 1.25% in 2020 to 3% in 2021. This means that Vancouver homeowners are losing money on properties. The small gain in home prices just isn’t worth this tax.

Buying a New Home

Instead of temporarily living in a tourist destination and waiting for the pandemic to end, people have actively been moving to less populated areas. Across Canada, the housing market has been as active as ever. BC mortgage rates are at an all-time low, so getting a mortgage has never been so appealing. Low mortgage rates mean that refinancing, buying a new home, or investing in real estate are all smart options. As cash loses value to inflation and low interest rates, buying a home is a great way to make sure you continue to earn a return. 

Moving to Kelowna

All the people leaving Vancouver have to go somewhere and a great option is Kelowna. Kelowna has great scenery, plenty of outdoor recreational activities, and a top job market if you want a new job after the pandemic. However, most importantly, you get a great deal on Kelowna homes compared to big cities. Not only are home prices lower, living in Kelowna can save you up to 40% on living costs compared to Vancouver. The only downside to living in Kelowna is Kelowna’s property tax is slightly higher at about 0.5%. However, with all the money you save on home prices and living expenses, you’ll still be spending much less than in an urban city.

Kelowna’s Housing Market

Kelowna houses are in high demand and it shows. They’re expected to increase by over 5% through 2021. Kelowna has always been a tourist destination, but with people’s newfound freedom to work and live wherever they want, people are choosing to stay. Another factor increasing Kelowna’s home prices is its lack of supply. Even though demand is rising, Kelowna has not continuously constructed homes for the past 30 years like most high-density cities. They have a modest number of homes that become more popular as people continue to move towards less urban cities.

What Now?

The pandemic has had some adverse effects on the way we live and our economy. However, it doesn’t mean that there’s nothing you can do about it. 

The Canada Mortgage and Housing Corporation (CMHC) helps Canadian home buyers by providing many mortgage assistance programs during the pandemic. The real estate market is one of the few sectors where the pandemic has given people more choices instead of more restrictions. Among the many options, Kelowna is a great place with many attractive features that make it such a popular city amidst the pandemic. With prices on the rise and remote working becoming a permanent part of businesses, now is the time to buy a home where you want to live. 

Dave Kotler

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