First Quarter Kelowna Housing Update
Now that the first three months are in the books it might be time to press pause and take a look at what’s going on around us. The business of buying and selling real estate in Kelowna continues with the main players being consumers who would normally move because normal life stuff happens. For example a job transfer, moving to be closer to family, downsizing, students, marriage etc. and these things haven’t changed. The people absent now are the house flippers, investors, builders, speculators and those purchasing with hopes of moving here five or ten years from now. The second group are still on the sidelines watching and waiting. The good news is that the first group represents the bulk of transactions recorded and they will never go away.
There were 415 residential homes sold during the first quarter this year at an average sale price of $1,118,000. The first quarter last year saw us record 782 homes at an average sale price of $1,269,000. Apartment sales are similar on the unit sale side with 256 sales during Q1 2023 compared to 471 sales during Q1 2022. Apartments are selling for 13% less this year compared to the first three months of last year. I don’t know why residential sales are up while condos are down. More than likely it’s a combination of increased supply of apartments on the market, fewer investors and changing legislation making it less appealing for landlords. Let that sink in for a moment before we try to figure out why this happened and what we can expect over the next three months.
The first part is easy. Numbers are down because of interest rates. Full stop. What we can expect over the next three months and the rest of the year is a little trickier to predict. We’re completely immersed in these numbers on a daily basis and trends are emerging with increased sales figures each week and month so if this continues, we’ll continue to at what everyone considers “normal” soon enough. There are threats with increased energy costs on the horizon, limited supply of homes for sale and ongoing inflation but the resiliency of the Canadian home buyer has been tested and they don’t sit on the sidelines very long.