Penticton translates to “a place to stay forever”, and if you ask any of the residents of this small city in the Okanagan Valley, it is aptly named. Nestled comfortably between the Okanagan and Skaha lakes, Penticton boasts long, hot summers, over 2000 hours of sunshine per year, beaches, award-winning wineries, and almost any terrain to please the outdoor enthusiast. With such strong appeal as a place to live, it comes as no surprise that the Penticton housing market has traditionally been strong, with high demand, and equally high price tags. 2019 ended on a high note in terms of real estate activity, with many retirees scooping up secondary properties, many on the higher end of the price scale. The average price of a single-family home in Penticton came in at $549,000 last year.
COVID-19 has depressed the real estate market in the Penticton community, just as it has in cities across the country. Due to social distancing measures impacting the way in which buyers can view a property, demand has waned, as have the number of people willing to list their properties during such uncertain times. While REALTORS® in Penticton and across the Okanagan region were quick to adapt to the shifting circumstances, adopting technology to make their ‘essential services’ as safe as possible, the local real estate market has still suffered in unprecedented ways. Below, we take a look into the top trends surfacing within the Penticton market, and how local real estate landscape with fare in the months ahead.
Market Activity in South Okanagan
The Canadian Real Estate Association (CREA) statistics for Penticton fall within the South Okanagan Real Estate Board. For the first quarter of the year, CREA reported that the region’s real estate market was hardest hit within April, when the numbers finally started to show the impact of buyers and sellers putting real estate plans on hold.
By the end of May, home sales in the South Okanagan region totaled 55 units, a steep decline of 52.3% from the same month last year. By the end of last month, inventory was also showing signs of slowdown, with only 117 new residential real estate listings – a 60.6% decline from May 2019.
The timing of the pandemic and lockdown measures make the current slow-downs seem particularly pronounced when we compare current levels to what was expected for the traditionally hot springtime markets within Penticton and the South Okanagan region.
Prices Holding Strong in Penticton
Despite sleep drops in sales and inventory, prices are moving in the opposite direction. The average price of homes sold in May in the South Okanagan Region was up by 5.2% from May 2019 levels, coming in at $449,761. Year to date so far to the end of May, the average home price also showed gains of 9.1% from the same period last year.
According to reports from RE/MAX agents in Western Canada, activity is already starting to heat up again within Vancouver’s Housing Market; it is hopeful that the province will be spared any significant COVID-19-related price nosedives. Buyers have started to re-emerge from the sidelines, and as demand returns for British Columbia’s competitive housing markets, house prices will hold strong. For Penticton’s market, this means that this upward trend is unlikely to change in the months ahead.
Realtors Maintaining Optimism
Real estate agents within Penticton, and across the Okanagan valley, are aware of the lure of their idyllic, picturesque communities, particularly for retirees. For this reason, there is much optimism for the months ahead, that as social distancing measures ease – as they have already started to do in many parts of the country – pent up demand will return to the Penticton housing market. This demand will be further fuelled by those who are keen to take advantage of low interest rates following the pandemic. While it may take some time until conditions can fully return to ‘business as usual’, after several months of distancing, we’re grasping on to any light at the end of the COVID-19 tunnel.