When I grew up on the south coast of British Columbia, I had a neighbor named Charlie. He was a good-natured American retiree with an incredible grin who had his speedboat ready at our dock.
Every June he pulled Ready to the beach and wrapped him up on a trailer.
“Well, Mr. Chris, we are gone!”
Every year Charlie and his wife Florence set off in their golden Cadillac with Ready in tow to a magical-sounding place above the mountains. A place called Summerland.
Charlie and Flo were part of the first population outbreak in the Okanagan Valley in British Columbia with their retirement home in Summerland.
Thirty years later, I’m part of the second outbreak. And I am not alone. The proof is in the recently published property reviews.
I moved to Okanagan six years ago to work for the local CBC office and bought a house downtown. I opened my last BC assessment notice and found it was up 16 percent. It’s the biggest jump in the last five years, showing an overall increase of 30 percent.
“It’s growing three times as fast as Victoria and Vancouver”
It’s a familiar story in my neighborhood. Property valuations in the central Okanagan rose so dramatically that the BC Assessment Authority sent letters to homeowners in December warning them of the impending spike. And my neighbors aren’t retirees like Charlie and Flo. They’re yuppies. They drive green Priuses, not gold Cadillacs.
The Okanagan is one of the fastest growing areas in Canada, and Kelowna is driving that growth.
“It’s actually growing twice as fast as the fastest growing city in BC and three times as fast as Victoria and Vancouver,” said Francois Sergerie of Statistics Canada in a 2016 interview.
And when you consider where the newcomers are from, it is clear that they are bringing in money.
For $ 500,000, you can either buy this 500-square-foot one-bedroom apartment in Vancouver (left) or this 1,500-square-foot two-bedroom apartment in Kelowna (right).
According to Sergerie, Kelowna’s growth comes primarily from Alberta and the lower mainland. Albertan migrants are typically over 45 years of age and many of them can be expected to be semi-retired and well-off.
The people who hail from Vancouver are mostly under 30 and some of them may benefit from Vancouver’s incredible real estate boom.
This younger contingent doesn’t want to live in the sticky taupe mini-mansions on the slopes of Kelowna, and they can’t afford it anyway. This puts enormous pressure on single-family houses in the city center.
On average, single-family home prices in Kelowna rose 11 percent that year. But it’s more dramatic in the hip and chic downtown North End, where many real estate is up 15 to 20 percent.
“Whenever values go up, it starts at the core,” said Shawn Worsfold, a senior real estate agent in Kelowna. “Downtown and the North End were hot markets this year.”
This demand means that supply is dwindling.
Vancouver spillover
“Last year inventories fell 29 percent,” said Worsfold. “At the same time, sales increased by 21 percent.”
That increase is even more dramatic in the $ 600,000 to $ 1 million range, where sales increased 90 percent.
“That’s an overflow from Vancouver,” said Worsfold.
For newcomers who cannot live in the city center, remote communities that retain a rural flair become more attractive.
Property valuations rose an average of 11 percent in West Kelowna, Peachland, and Summerland. Homes in the Lake Country area just 15 minutes from Kelowna and near UBC-O and the airport saw property values jump 16 percent.
Those numbers are still a long way from the greater Vancouver area, where most real estate grew by 30 to 40 percent.
“People can’t believe what they can get”
And statistics suggest that real estate values in Kelowna may still grow, especially if the cash-flushed people keep moving out of Vancouver.
According to a recent report by Canada Mortgage and Housing Corporation, “this would likely bring average prices closer to the top of the broad forecast range as shoppers moving out of this region may have significant purchasing power driving prices up.” could.”
Despite the surge in property values in the Okanagan, it’s still an attractive trade for young people in inflated markets.
Imagine a working couple who can afford a home like mine and who prefer a 30-minute commute or less.
In the greater Vancouver area, they could afford an apartment or one of eight townhouses currently listed under $ 500,000 – all under 800 square feet – but not a single-family home.
In the central Okanagan, the same couple currently has 24 single-family homes to choose from – some over 2,800 square feet.
“People can’t believe what they can get,” said Worsfold, who says his lower mainland customers “could buy double a house for half the money.”
Vancouver property values have fallen since July valuations. Worsfold believes prices in the Okanagan have continued to rise since the summer. He says that someone who sells a million dollar home and moves to Kelowna will still be surprised at what they can get.
“A million dollars here will bring you a Taj Mahal.”
