Not unlike the majority of Canada, British Columbia’s Okanagan Region is experiencing a strong sellers’ market fuelled by the COVID-19 global pandemic. Real estate prices across the Okanagan have enjoyed unprecedented highs over the past year and are expected to continue to exceed historical levels.
Across Canada, home sales are up with national home sales rising approximately 5.2% on a month-over-month basis in March. Record breaking sales were seen in Canada this past March with 76,259 residential properties being sold – beating out the record for the highest sales volume set in July 2020 by more than 14,000 sales. These statistics are largely attributed to the effects of the COVID-19 pandemic across the country.
With more people working from home, buyers are in the market for larger pieces of property and homes that can provide them with a vacation-esque living situation; this is precisely where parts of Okanagan come into play. With many typical recreational activities currently off limits (to help combat the pandemic), buyers are after housing that can provide them with a little more room to enjoy the great outdoors. Particularly in areas like Kelowna, vacation homes are selling rather quickly, “We are seeing a noticeable increase on various types of recreation and vacation homes sales suitable for all seasons,” the Association of Interior Realtors (AIR) president Kim Heizmann said in a press release. “Due to COVID related travel restrictions and limitations, more and more inter-provincial buyers are taking the opportunity to create vacation opportunities within B.C.”
Okanagan in a Hot Sellers’ Market
Mirroring real estate trends in real estate markets across Canada, the Okanagan market is experiencing high sales volume and low inventory, only fuelling the sellers market and making property prices skyrocket. Kim Heizmann, president for the Association of Interior Realtors echoes this viewpoint, “It hasn’t changed, we have continued to have almost the exact same story in the news. With inventory being at an all-time low and buyer demand continuing to rise due to the change in focus of lifestyle, specifically for the Okanagan. People are wanting to come here with the ability to work remotely, which is pushing the buyer demand up and with the lack of inventory that is also punching pricing up.”
While it was expected to be an excellent first quarter in Okanagan real estate, the actual sales have outperformed the projections everywhere from Revelstoke to the South Peace River region. In fact, February 2021 alone saw an increase of 116% in sales when compared to February 2020; numbers that only persisted through the month of March. Specifically, Central Okanagan saw an increase in sales of single-family residential homes of approximately 134.7%. While this is impressive, it is the Shuswap/Revelstoke area that saw previous figures smashed in the month of March.
Specifically in the Shuswap/Revelstoke area, single family residential home sales increased by a whopping 150%, townhouse sales increased by 133.3%, and condominium/apartment sales increased by a staggering 733.3% when comparing March 2021 to March 2020. Overall, residential sales across Okanagan for the month of March were up 146% compared to the same period in 2020.
While these posted figures seem outlandish, perhaps the most telling numbers are when it comes to the price of these dwellings. Current average real estate prices confirm that the Okanagan is in a hot sellers market. Benchmark prices across the area have inflated by double digits, specifically in the Central Okanagan, North Okanagan, and Shuswap/Revelstoke regions. And this activity will only prevail amid persistent supply shortages in markets across the Okanagan.
Shortage of Supply Expected Well into the Spring and Summer
With the continuation of the COVID-19 restrictions across the country, many people are not expecting to get away to warmer or more vacation-friendly locations for the foreseeable future. This fact is leading many homebuyers to seek out larger, more vacation-style properties – specifically in areas like Okanagan, British Columbia. However, the demand for homes cannot be met in supply, leading to bidding wars and a staggering increase in prices.
As the warmer months settle in, it is expected that the supply will continue to diminish as sales activity forges forward. In fact, Kim Heizmann, AIR President, believes that the shortage of supply is lending itself to the increase in price, “Shortage of supply is still an issue with inventory struggling to meet demand, particularly when it comes to single-family homes. Buyers are struggling to find homes and the lack of supply is putting upward pressure on pricing,” These conditions are expected to last well into the summer months and as 2021 progresses, so your best advice for accessing this market at present, is to ensure you are navigating it with an experienced, professional REALTOR® by your side.