How Does Federal Tax Relief Effect the Kelowna Market?
There are currently 1,851 houses for sale in Kelowna and 1,595 condominiums which is interesting statistic. When Jo-Ann and I moved here in 1996 condominiums represented less than 10% of the market and now we may soon see a time when there are more condos for sale than residential houses. Also of note, there are finally more homes for sale under $400,000 (331) than homes priced over $1 million ( 300). This is important for any housing market dependant on first time buyers and move-up buyers that there is ample supply of homes available for working families.
There have been 42 residential sales so far this year with an average sale price of $410,000. It didn’t look like the housing market would start up but there were 19 residential last week. Contact us for details on the condo market through the first 27 days of January.
A couple of good deals out there are a) 578 Coronation asking $319,900 972 square feet updated and recently renovated with a good tenant and b) 2190 Burtch in Kelowna South asking $379,800 2400 square feet four bedrooms/3 bathrooms and priced $45,000 below BC Assessment. It does need some updating. Contact us for more details.
Finally, the federal government tabled their budget today and it includes first time buyer tax relief of $750 after closing a deal. Current home owners can qualify for a tax credit of up to $1,350 for home renovations. This is welcome news but I’m wondering why CMHC (Federal Housing Authority) introduced 40 year mortgage guarantees and zero down schemes during a housing boom and eliminated this program now.
If you are thinking of buying a house or a condo in Kelowna call a Realtor who knows his numbers in home values. Andrew will send you a complete list of the best homes for sale in your price range
Royal LePage Kelowna has a 35% market share with over 200 full time real estate agents and the number of buyers moving from Calgary totalled 29 for the entire year. 29 Calgary buyers would have been a slow month in 2007-2008 but Albertans have clearly taken a wait-and-see approach to our market. This is having an impact on prices as homes are now being priced for the local market.
It’s sure good to have everyone back to work in the new year. During the first week back, our market generated 10 residential sales with an average sale price of $425,000. There are 1,800 homes for sale ranging in price $199,000 for a half duplex in Glenrosa (court ordered sale) up to 290 homes for sale with asking prices over $1 million. There are 12 foreclosures on the market right now. As usual, well priced homes are selling especially those in the $350,000 to $450,000 range. Buyers are being more selective and aren’t jumping at the first home they see.
The condominium picture is similar with 7 condos selling during the first week. There are 1,480 condominiums for sale right now including 729 that allow rentals. The statistic that leaps off the page though is the 466 units for sale that are currently vacant. This has turned into a buyer’s market.
There are currently 1,765 residential homes for sale in Kelowna. This is more inventory than we are able to sustain with only 72 sales in December but December is traditionally the slowest month of any year in real estate. There were 141 sales December 2007 which is about a 50% drop in number of homes sold month over month.
If you are a numbers person (and you know who you are) you’ll enjoy looking at the median and average sales prices for December 2008 versus 2007. The average sale price December 2007 was $520,000 which is UP from $507,000 the year before. The median price for December ’08 was $430,000 which is down from $465,000 December ’07. This can be partly explained by the fact that there were 5 homes selling last month over $1,000,000 which skewed the averages higher. The median sales price is always lower than the average sale price.
The important number to look at though is 72 homes selling last month and whether or not this is the new normal and the days of 200-250 sales a month are over. I think we’re going to have another year like 1999 when there were 175-180 homes selling per month. We’re certainly going to see more real estate agents leaving the business this year because there isn’t a single candidate taking the real estate course this Winter with our company and we typically have 10-15. Even if I’m right with the 175 homes selling per month this year, that isn’t enough to sustain an inventory of 1,765 homes for sale so we will likely see downward pressure on prices. If you are thinking of buying now is a good time, there are some great opportunities for sale. The condominium market took the month off in December with 38 sales with an average sale price of $301,000. This is down from 92 sales in December 2007 with an average sale price of $309,700. There are 1,480 condos for sale right now not including new projects which don’t show up on our MLS system. The condo market, especially with out of town buyers, usually explodes in Spring after the highways from coastal BC and Alberta become a little more manageable.