A triple hit of negative forces slowed the Kelowna real estate market further in November.
“Last month we waited to see how the market would react to the Bank of Canada’s recent rate hike and the British Columbia government’s filing of speculative tax,” said Marv Beer, president of the Okanagan Mainline Real Estate Board.
“In addition, the market traditionally slows down at this time of year. We see the effect of all of these actions. “
The Kelowna real estate market is still considered balanced, giving preference to buyers and sellers alike.
However, it came as a shock to the seller’s market earlier this year that homes were selling quickly, sometimes for more than the asking price.
In a buyer’s market, buyers sit in the driver’s seat, taking their time and negotiating less about prices than about questions because the market is soft.
“While a large shift towards a strong buyers’ market could be expected to be positive, the reality of British Columbia’s economy is so tied to real estate that those conditions can lead to job losses, mortgage foreclosures, and the like,” said Beer.
“It is never ideal for markets to move sharply in either direction, and a lot the government can do to reduce the peaks and valleys, including a focus on not only dampening demand but also housing development promote that reflects the needs and wants of those who want to buy. “
The buzz or lack of buzz about property terms is usually a self-fulfilling prophecy.
Earlier this year when the market was hot, there was speculation, momentum picked up, sales were brisk and prices escalated.
However, the bumps in higher mortgage rates, talk of a speculative tax, and an overheated market took a breather and the market stalled as sales fell and prices weakened.
Last month, 323 properties listed on the Multiple Listing Service were sold for a total value of $ 173.3 million.
That’s 31 percent less than the 467 that were sold in November 2017, valued at $ 236 million.
The increasingly slack conditions mean that homes sit longer in the market before they are bought.
In November last year, the average number of sales days was 50.
Last month it was 63.
The sales slippage has also dampened average sales prices.
In November, the benchmark average single-family home sales price was $ 650,785.
That’s just 3.5 percent less than the average of $ 674,624 a year earlier.
However, it’s a nosedive from the record high earlier the year of $ 782,398 in July.
The median sales price for a condo was $ 329,313 in November, a two percent decrease from last year.
The average sales price for a townhouse rose nine percent over the year to $ 513,330.
The majority of buyers, 60 percent, are first-time, step-up, or downsizing from Kelowna and the Okanagan.
Vancouver was a major source – several months, 30 percent – of buyers earlier this year and last year when the market was buoyant.
Vancouverites sold their homes for $ 1.6 million or more and bought the Okanagan for half the price.
But the Vancouver market has also declined, slowing the flow of money on the lower mainland in this way.
Alberta buyers remain stable at about 11 percent of buyers, while buyers from the rest of Canada and other countries are stable at about three percent.
