Kelowna Real Estate Report June 2020
Rom’s Monthly Real Estate Opinion
Below you will find the ‘benchmark’ prices for properties. This provides us with a much better idea of the current market rather than using ‘average’ or ‘median’ prices. ALL property prices (Condo’s, Townhomes and Single Family), went UP compared to June 2019.
Despite the Pandemic, the real estate market is active and properties are selling. Moreover, the market has bounced back to an astounding level. It is right back to where we thought it would get to before COVID-19 hit. There is no algorithm for the effects of COVID-19 on the Okanagan Real Estate market. World renowned economists really don’t have any idea either.
In Kelowna, the absorption rate for June was 24.39%. This means that 24.39% of all residential inventory in the Central Okanagan sold in June! It hasn’t been that high since April 2018. There were 261 residential sales in June in the Central Okanagan. That is the highest number of sales since July 2017.
So, what is going on?
How can the market be flourishing when unemployment has shot up and the GDP has shot down? There are 2 factors creating this.
First, banks and governments have stepped up hugely. The pandemic did take eligible buyers out of the market. However, every time the interest rates dropped another fraction of a percentage point, multiple new buyers were now able to buy. Remember, the market is driven by the buyers. There was also a backlog of buyers who were ready to purchase but were waiting out the Pandemic. Since we entered phase 3 here in BC, consumer confidence returned and therefore real estate activity spiked.
Second, the market and the economy are not doing well in Alberta. Edmonton seems to be doing slightly better than Calgary but they are both hurting because of COVID-19 effects and the bust of the petro-chemical industry. This is driving some to pull that retirement trigger earlier than previously planned and move to the Okanagan.
Please remember this is just the world according to Rom.
