What’s happening in the Okanagan Real Estate Market?
The Federal Government has announced 2 ways they are considering to slow down the upward pressure on house prices.
Firstly, a proposed ban on foreign buyers purchasing houses across Canada for the next 2 years. However, the percentage of foreign buyers in Canada has dropped from 9% in 2015 to only 1 % in 2020. I therefore don’t think this will have any real effect on house prices.
The second proposal is to invest billions into new construction. That is really the only way to slow down the house price increases. The market is driven by supply and demand. We either have to increase the inventory or decrease the demand. The demand for housing in April is still strong in the Okanagan. The absorption rate for March 2022 in the North and Central Okanagan is still above 60%. That means in March 60% of all the houses on the market on the first of the month sold in March. Therefore increasing the inventory should work to slow down the market.
We haven’t yet seen the effect on the market of the rising interest rates and in turn the increasing mortgage rates. Although it is still a great time to sell your home (especially if you own a secondary home!!), the increasing mortgage rates will price more buyers out of the market. Increased mortgage rates and increasing inventory should help shift to a more balanced marketplace.
The graphic below shows that the market is similar across Canada. The only place in the entire country where prices dropped was the Yukon and it was only by 1.5%. BC is in the top 3 for price increases.
However, you always have to remember that this is just the Real Estate World according to Rom.
If you would like to find out what your home is really worth in a market like this give me a call or text me at 250-317-6405 and I would be happy to evaluate your home. It can be done completely remotely if you prefer. It is totally free.
