Has the local property market turned a corner?

A local realty expert says the housing market is showing signs of returning to stronger activity and does not believe the Kelowna region will see the sort of national dips of 25 per cent some have predicted.

Despite the benchmark price for a typical single-family home in the Central Okanagan area declining around 10 per cent from its spring peak, the Association of Interior Realtors said typical seasonal behavior had returned in August.

“We’re talking about a market coming down from what was an historic high,” the association’s president Lyndi Cruickshank told Kelowna10. “It’s [now] settling out, I think we’re finding a place of a more balanced or normalized market which honestly is a really good thing.”

There was a total of 1,205 residential unit sales across the entire Interior region last month, a very small increase from the 1,196 sold in July, but Cruikshank said the trend was in the right direction when it comes to the amount of homes now up for sale. Overall inventory was up 61 per cent with 7,876 units currently on the market compared to August 2021.

“I absolutely understand [rising] interest rates will affect people’s ability to purchase … but with the shortage of inventory we’ve had over the last year it was making it extraordinarily difficult for people to even consider selling their homes,” she explained, noting sellers were scared they wouldn’t be able to find a place to move to. That has now changed.

Some experts have predicted on a national level, house prices may fall by as much as 25 per cent from their peaks by the end of 2023. That's because the COVID-related buying surge is over and rapidly increasing interest rates have slowed the market. However, Cruikshank figured that won’t happen in the Central Okanagan because the trend of people moving to this area from larger markets isn’t going to stop.

“I expect many of those people will continue to make those lifestyle choices. Those are the people who will keep our market being as healthy as it is. We live in a unique market … a beautiful part of the province and those elements aren’t going anywhere.”

Price dip since spring peak

The benchmark price of a single-family home in the Central Okanagan was $1,017,500 in August, which is down four per cent from July, and 10 per cent down from the peak of $1,131,800 in April.

The benchmark price of a typical townhouse was $772,700 last month, which is 1.2 per cent lower than July and a 6.5 per cent drop from the May peak of $829,800.

A typical condo will now cost $526,700, which is actually a 0.75% increase over the previous month but around five per cent down from the April high of $557,400.