Kelowna Real Estate Market News July 2022

Both Buyers and Sellers are watching the real estate market very closely at the moment, as the market continues its shift.

Predictions that a recession is on the way, inflation is continuing to rise and further interest rate rises are coming, are all definitely having an effect on consumer confidence.

We know that interest rates are going to continue to rise and this will affect Buyer’s purchasing power in the coming months, inflation is also biting into people’s incomes, but we have not started to go into a recession yet. So it is a little surprising how much of an effect is having on the Kelowna Real Estate Market.

Looking at last month’s buyer survey results the number of First-Time buyers was lower, but interestingly the Moving Up & Empty Nester buyers were busier in our Real Estate Market. Also, while inventory continues to rise, overall inventory levels in the Central Okanagan are still on the low side.

The result has seen many Sellers adjusting their pricing downloads to attract buyers, who, when they do make an offer are trying to build in a ‘contingency factor’, as they are concerned about future Real Estate values.

As a result, we have certainly seen some ‘low-ball’ offers and we are now seeing offers ‘ ‘subject to the sale of homes’ again. Sellers are now having to adjust to this change and we have seen some pushback resulting in fewer deals ‘coming together’.

Current pricing is very much being driven by what a buyer is willing to pay and what a seller is willing to sell for.

Kelowna & Central Okanagan Real Estate Sales June 2022.

June 2022 Real Estate sales numbers show a quite dramatic change in the number of sales.

Compared to the last month-:

– Total Sales were down 30.3% last month.

– Single-Family home sales were down 31.3%.

– Strata sales down 29.4%

Compared to last year -:

– Overall sales were down 48.3%

– Single-Family Home sales were down 54.3%.

– Strata sales were down 41.7%.

Inventory Levels June 2022

Inventory levels are now rising sharply.

Total listings in the Central Okanagan are now 2302, up 24.2% from 1854 last month and up 58.5% from 1,452 last year. 

Single Family & Bare Land Strata Residential 1073 units up 24.2% from 864 last month and up 107% from 519 last year. 

Condo – 411 up 34.7% from 305 units last month and up from 315 last year.

Town Homes – 292 up 35.8% from 215 last month and up 80.2% from 162 last year.

Looking at the current level of listings today, compared to last months sales the Sales to Active listings percentage is 17.8%, which very much puts us into balanced market territory.

Median Real Estate Prices – June 2022

Single Family Homes & Bare Land Strata 

June $1,010,000 May 2022 $1,065,500 2021 $890,000 – has been on a downward trend since March 2022 when it peaked at $1,151,000. The median price is down 12.3% since March.

Condos

June 2022 $453,500 May 2022 $485,500 2021 $412,500 – Peak was March 2022 $520,000. The median price is down 12.8% since March.

Townhomes

June 2022 $684,000 May 2022 $715,000 2021 $607,500 – Peak was March $786,000. the median price is down 13% since March.

This month’s watch list – Kelowna Real Estate Market.

1. Inventory –  Inventory levels are now rising more sharpely, so the good news for Buyers is that there is more inventory available, Sellers are more willing to negotiate and median prices have softened between 12% & 13% from their peak in March.

2. Interest Rates –  The Bank of Canada is widely forecast to rise interest rates again at it’s next meeting on July 13, 2022. The bad news for buyers is this will affect purchasing power, so it is important to lock in a rate with your mortgage lender before then if you’re planning to move in the next few months.

3. Behavioural Economics –  we are seeing some sellers recognizing that we have reached the peak of the market for now, and are selling to take their profits.

4. Current Reality – with sales numbers falling more dramatically last month, more sellers are going to feel the pressure to reduce their prices, if their homes do not sell in the timescale they hoped. There is much more competition now for buyers, and so it is essential that the home is priced correctly, they are preapred to negotiate and that their property shows at its very best.

5. Prices – have peaked for now with Median prices peaking in March 2022, and we are firmly in a balanced Real Estate market. Sellers now is not the time to be overly agreessive with you list price, as you might find yourself chasing the market down. Some Sellers may need to wait for the next market change to get their price. Buyers check carefully what your current mortgage qualification is, as if interest rates rise too high you might be caught with much less borrowing power than you thought.

Kind Regards

Trish Cenci

This month’s photo – Myra Canyon Trestles July 2022.