Seller’s market to persist in Kelowna housing market in 2022, prices expected to rise 9%
Seller’s market conditions are expected to persist in the Kelowna housing market in 2022, conditions prompted by tight housing supply. Low interest rates could also play a role for buyers in 2022, specifically there’s a possibility that the market may see a flurry of buyers rushing to purchase in the new year to take advantage of the lower rates, before the Bank of Canada’s anticipated rate increases begin to take effect starting in the spring. This may result in further upward pressure on prices, as supply remains limited.
Buyers relocating to central Okanagan are likely to continue pushing demand and prices up into 2022. Three of the most desirable neighborhoods in Kelowna are Lower Mission, South Pandosy other savages. As the Canadian economy continues to strengthen, housing is expected to continue to do the same, with more retirees looking to Kelowna for its quality of life and relative affordability.
Single-detached homes in the region have experienced the greatest year-over-year price appreciation from $858,741 in 2020 to $1,050,667 in 2021 (+22.3%); followed by townhomes from $545,227 in 2020 to $648,127 in 2021 (+18.8%); and condominium apartments from $367,362 in 2020 to $439,823 in 2021 (+18.3%).
Specific housing amenities are expected to be prioritized by buyers in 2022, including: pools; family space; home offices; and yards.
When it comes to new construction, new single-family homes are being hampered by the lack of building lots. For first-time homebuyers the typical range to enter the Kelowna market is $600,000 – $800,000 which is anticipated to continue into 2022.
Average residential sale prices in the Kelowna housing market are anticipated to increase by nine per cent in 2022.
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Canadian Housing Market Outlook for 2022
From a national perspective, RE/MAX is anticipating steady price growth across the Canadian real estate market in 2022, with inter-provincial migration continuing to be a key driver of housing activity in many regions, based on surveys of RE/MAX brokers and agents , as reflected in the 2022 Canadian Housing Market Outlook Report. The ongoing housing supply shortage is likely to continue, putting upward pressure on prices. As a result of these factors, RE/MAX Canada estimates a 9.2-per-cent increase in average residential sales prices across the country*.
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“Based on feedback from our brokers and agents, the inter-provincial relocation trend that we began to see in the summer of 2020 still remains very strong and is expected to continue into 2022,” says Christopher Alexander, President, RE/MAX Canada. “Less-dense cities and neighborhoods offer buyers the prospect of greater affordability, along with liveability factors such as more space. In order for these regions to retain these appealing qualities and their relative market balance, housing supply needs to be added. Without more homes and in the face of rising demand, there’s potential for conditions in these regions to shift further.”
Despite the global pandemic, many Canadians still feel confident in the real estate market. According to a Leger survey conducted on behalf of RE/MAX Canada, 49 percent of respondents believe Canadian real estate will remain one of their best investment options in 2022 (59 percent of homeowners vs. 34 percent of non-homeowners which included renters, those not looking buy, and those currently looking to purchase). Additionally, 49 percent of respondents are confident the Canadian real estate market will remain steady next year.
“Canadians recognize the value and investment potential in their homes. However, market challenges such as rising prices and limited supply have impacted local markets from coast-to-coast, causing anxiety this past year among those looking to get into the market and those hoping to move up in it,” says Elton Ash, Executive Vice President, RE/MAX Canada. “Despite this, it’s encouraging to see that many are feeling confident in the housing market in 2022 and view Canadian real estate as a solid investment.”
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Additional findings from the 2022 Canadian Housing Market Outlook Report
- Two-in-five Canadians trust their agent to advise them during the current real estate landscape (43 percent)
- 23 per cent of Canadians now have a greater desire to build their own home or buy pre-construction
- 26 per cent of Canadians have the desire to purchase a home while mortgage rates remain low
- 62 per cent of Canadians currently own a home. This is higher among those ages 35+ (70 per cent) compared with Millennials, ages 18-34 (42 per cent)
- The majority of Canadians (72 per cent) said rising home prices did not impact their purchasing decisions in 2021.
