Spring Market Update
Spring is normally an interesting time in the real estate business, it is usually the best time of year for sellers to list their property, but this spring has proven to be especially interesting due to a shortage of homes on the market. This is having a flip effect on the local real estate situation, as many sellers are reluctant to list their home in case they do not find a new one.
Thankfully, that early spring trend is shifting as recent data has shown overall listings to be up by 3.6% in May this in comparison to this time last year. And because the numbers have been consistently falling each month, it is a good sign to see them rising.
The early slowdown by reluctant sellers caused residential sales to drop to 24% compared to the previous year; however, the decline has slowed down and brought sales in May down to 8% compared to May 2016.
Year-to-date, we have watched this number drop from just around 24% to 19.67%. This is good news for the market and the slowdown in the decline has encouraged more sellers to feel confident about entering the market. And in fact, the number of units listed in May 2017 in the Central Okanagan was 1,181 and the number sold in the same month was 807.
This year, sellers want to take advantage of the increase in the prices of residential properties. On average, residential prices are up by 17% compared to May 2016, and median prices are up 16%.
The average property price in May 2017 are as follows:
Residential – $703,809
Townhome – $448,802
Condos – $348,286
Lots – $332,118
In addition to the increase in profit, the average time it takes to sell a house, or the Days on Market (DoM) is just 46 days for residential properties, which is the same as last year. And for all properties, the DoM in May 2016 was 62 days to sell, while in 2017 it fell to 55 days.
However, these figures are an average, and local Kelowna realtors are experiencing a faster sell time when the residence is competitively priced. Many homes that are priced to sell are still taking advantage of the increase in pricing, but they are also fast – often less than a week.
The good news is that the market is healthy and thriving. Prices are rising and properties are moving quickly. And this positive environment has encouraged more sellers to list their properties.
Another boost to the real estate market is in-migration to the Okanagan. The influx of new residents has a positive influence on the demand. A growing population adds to the economy in multiple sectors. And as the Valley continues to develop new home constructions, the economy of the Okanagan is forecast to continue to prosper, as homes, jobs, and new business continue to grow.
As the economy of British Columbia continues to grow, the future looks promising. BC has the strongest economy in the country, and as we continue to develop, build and invest in our potential, we should be able to maintain this direction for years to come.