The wacky world of residential sales in Kelowna and area saw more records smashed during May according to the Okanagan Mainline Real Estate Board (OMREB).
More than 1,200 residential units listed on MLS were sold last month in the Okanagan, which is an astonishing 35.5% more than what sold in May 2015. Of those, 878 sales were in the Central Okanagan Zone, representing Kelowna and area, and 479 sales were single-family homes.
Anthony Bastiaanssen, president of the OMREB said in his monthly report that buyers will continue to see prices rise, very short turn-around time between when a home hits the market and when it’s sold and multiple offers – conditions often difficult to navigate when looking for a property to purchase.
The average home prices last month was $486,636, up significantly from $459,595 in April and up 15% over May 2015. Last year homes were on the market an average of 92 days, and in May that figure dropped to 77 days. The number of listings active on the market fell by 19% over May 2015.
Bastiaanssen noted that with the market moving as quickly as it is, the environment is challenging which is why now more than ever it’s important to rely on a real estate professional for buying and selling property in the Okanagan.
Where Kelowna home buyers are coming from
Buyers in Kelowna and area are still primarily from the Lower Mainland and other spots in the province. The uptick in buyers from these locations is filling in what Bastiaanssen refers to as a gap left by Albertans that typically purchase recreation or retirement properties. REALTORS® are also seeing interest from buyers in Toronto.
He says the short supply of houses in driving prices up, but with housing starts in the region up so high the inventory situation will be eased as new units come on stream.
Incentives for new Kelowna home construction
Recently, the B.C. government passed legislation that will exempt new construction units priced under $750,000 from a property transfer tax. This exemption should spark new home builders into stepping up production.
With prices on the rise and vacancy rates on the way down, one solution being embraced by the City of Kelowna is the micro suite.
According to Ryan Smith, manager of community planning in Kelowna, the City has approved more than 500 micro suites many of which are currently under construction. A micro suite is an apartment condo less than 314 square feet in size and Smith refers to the demand in Kelowna as overwhelming.
Micro suites are touted as housing solutions perfect for single people and those that live in Kelowna only part time. Many of the construction permits the City has seen from developers are for new builds in older neighbourhoods where utility and community infrastructure is already in place, minimizing impact on city services.
Many are building close to UBC Okanagan.
Kelowna & Area May 2016 May 2015 Change
Total Sales: 878 598 +46.82%
Total Sales YTD: 3,016 2,262 +33.33%
Average Price $510,655 $446,144 +14.46%
Median Price $450,000 $399,950 +12.51%
Days on market (av) 62 75 -17.33%
Days on Market YTD: 71 81 -11.96%
New listings May 1,136 1,107 +2.62%