To the surprise of many experts 2015 was a strong year in the Kelowna real estate market. Overall unit sales were up for both condominiums and houses and same for sale prices. How come? With the drop in oil it was expected that the Kelowna housing sector would experience a loss since so much of our market is dependent on confident and well healed Alberta buyers scooping up revenue properties and the Kelowna-based oil patch worker who lives here but commutes back and forth. So many of us were bracing for bad year. That was pretty much the conventional wisdom a year ago and to be honest it was how I saw things turning out.
Kelowna Housing in 2016- 2015 Homes Sold at an Average Sale Price of $551,000
This is what happened though. There were 3,042 residential home sales in 2015 selling at an average sale price of $551,000. This is up from 2,796 sales in 2014 at an average sale price of $542,000. The fourth quarter was particularly strong with 600 sales at an average of $570,000 compared to Q4 in 2014 when we had 548 sales at $525,000 which means 2016 will start strong. Similar story for condominiums with our MLS recording 1,174 residential apartment sales at a $259,000 average compared to 1,027 sales at $243,000 the previous year. Digest that for a while.
A few things happened that impacted the final numbers. No one can deny that there were fewer Albertans buying houses here in 2015 but there were a lot more buyers from equity rich Vancouver’s lower mainland and Vancouver island who find our prices affordable. People from the coast don’t blink when they’re looking at a $300,000 condo or $500,000 house when they compare our prices to those in North Van, White Rock or Victoria.
Another factor was the declining value of the Canadian dollar compared to the US dollar. Many people took a pass on buying secondary houses in the Okanagan during the housing boom and invested in Arizona, Hawaii and California. Ten years later their properties rose in value and the extra 30% difference in the US dollar gives them a lot more buying power in the reasonably affordable areas of western Canada that people like to live. These areas include parts of Vancouver Island and the Okanagan from Salmon Arm to Osoyoos.
Kelowna will always be a blue chip investment
Regardless of whether or not you you’re optimistic or pessimistic about our housing market, Kelowna will always be a blue chip investment for those who only look at those sorts of things but more importantly a pretty nice place to raise a family and call home.
All the best from Jo-Ann and I in the new year and thanks for reading.
Royal LePage Kelowna