Kelowna truly is the Okanagan’s hot pocket. Anticipated population growth in the region and the boost to the economy is expected to keep the bustling real estate industry busy until at least 2021.
This forecast was issued by Canada Mortgage and Housing Corporation (CMHC) after analyzing B.C.’s interior real estate climate. Spokesman Taylor Pardy said that housing in all sectors will remain elevated for the next five or so years. The two strongest demographics moving to Kelowna and the Okanagan are young adults and retired people, indicating strong buyer interest in apartment condos, town houses and duplex homes.
The news from CHMC indicates that the region is attracting more than just vacation home buyers and seniors looking for a nice place to retire, further solidifying their forecast that the recent flurry of activity isn’t just a flash in the pan. Kelowna’s economy is by all indicators healthy and diverse, attracting younger, energetic workers who are entrepreneurs or who work in health care, high tech industries, wine or tourism.
The projections from the provincial government show that projected growth in Kelowna should be as much as 5.1% in the next five years for people aged 25 to 49, with the 50-plus crowd growing by .4% to 6.5%. The annual population growth of 3.25% is mostly new migration from the Lower Mainland and Alberta with a fraction of new populations coming from the maternity ward at the hospital.
However, just over half of home buyers in the Okanagan are locals who are first-time purchasers, or moving up or older buyers who are “right-sizing”.
Rumours in the marketplace are that the new 15% tax put in place by the Clark government on foreign buyers and investors in Vancouver will be enough of a deterrent that those buyers may look more closely at Kelowna, however the Okanagan Mainline Real Estate Board doesn’t think there will be much of a spin off. Buyers who want Vancouver usually have enough in their pockets that a 15% tax isn’t going to matter much. Vancouver residents who are selling at a profit to move to greener pastures in the Okanagan is where buyers from the west are coming from.
In July, a detached home in Kelowna on average came in at $625,000 which is a remarkable 19% increase over July 2015. Compare that with $1.1 million which is the single-family home average selling price on the Coast.
Condo sales are also up by 7% at $290,400 on average and attached townhouses shot up by 16% to $451,500.
There are 668 sales in the residential sector in the Central Okanagan Region in July, which is an increase of 24% over July of last year. Real estate professionals are reporting multiple offers on desirable properties and fewer homes available. A seller’s market prevails in Kelowna.
Kelowna & Area July 2016 July 2015 Change
Total Sales: 752 578 +30.10%
Total Sales YTD: 4,640 3,501 +32.53%
Average Price $517,164 $449,537 +15.04%
Median Price $465,000 $412,500 +12.73%
Days on market (average) 66 87 -23.90%
Days on Market YTD: 68 81 -15.39%
New listings July 926 923 +0.33%