_{This series is sponsored by RE/MAX Kelowna}

Jim Csek and Jerry Redman break down the latest numbers in Kelowna’s real estate market in their recent conversation. While things aren’t soaring high or plummeting, there are notable shifts in inventory and prices that homeowners and buyers alike should keep an eye on.

Jerry describes the current state of the market as "treading water," highlighting that various segments are experiencing contrasting movements. “Some inventory is up, some inventory is down, some prices are up, some prices are down,” he mentions, emphasizing that it’s not a one-size-fits-all scenario. A key factor influencing buyer hesitation seems to be the anticipated movement in Bank of Canada rates. Many potential buyers are taking a “wait-and-see” approach, hoping for a dip in rates before making any big commitments.

Market Stats: A Closer Look

Single-family homes, condos, and townhomes each tell their own story. Single-family home sales, for instance, are up by 0.9%, while the benchmark sold price has increased by 6%. Inventory, however, has seen a substantial rise of 38.9%. “That’s huge,” notes Jerry, as he points out the abundance of choice now available to buyers, something that hasn’t been seen in a while. Despite this, the number of days homes are staying on the market has gone down, suggesting that properties are still moving, albeit with a slightly longer decision window for buyers.

Condos show a similar trend with a 31% increase in inventory and sales up marginally. Average sold prices are climbing, and like single-family homes, days on market are shortening. Meanwhile, townhomes, a popular option for families and first-time buyers, have seen inventory rise by nearly 30%. Prices in this segment, however, have taken a small dip, making it an appealing option for those looking to get into the market.

Economic Factors and Future Outlook

Interest rates and economic forecasts are undoubtedly shaping the current real estate landscape. With a mix of local and national factors at play, Jerry highlights how fluctuating job numbers and recession fears are contributing to a cautious environment. In BC, the prospect of younger residents leaving due to affordability and economic challenges adds to the complexity. “We’re starting to see those recessionary things starting to kick in,” he says, pointing to forecasts that suggest inflation could dip below 2%, which comes with its own set of concerns.

What’s Next for Kelowna?

The future of the market largely hinges on where interest rates go from here. Jerry predicts that the market might start to gain momentum once five-year mortgage rates drop to below 4%. “When you start seeing it back into the threes, that’s where people are going to start to say, ‘Hey, I’ll take that mortgage at that point,’” he explains. However, he cautions that the days of ultra-low rates like 1.75% are likely gone for the foreseeable future.

Additionally, new home builds have slowed dramatically, with few major projects breaking ground. Developments like Caban and Aqua are nearing completion, but there’s little in the pipeline after that. “Housing starts across Canada are down, and they’re saying we need to increase housing supply dramatically,” Jerry notes. But high financing costs and government delays make it a tough environment for developers.

The Road Ahead

All in all, Kelowna’s real estate market is stable but in a holding pattern, waiting for the next big interest rate announcement. Buyers have more options to choose from, and sellers are adjusting to a more balanced market. With inventory up and days on market decreasing, the next few months will be crucial in determining whether the market starts to heat up again or continues to tread water. As Jerry and Jim plan to revisit the topic when the next Bank of Canada update is released, one thing is for sure: all eyes are on the rates and the ripple effect they’ll have on Kelowna’s real estate scene.