February 28, 2009

In real estate it's important to remember: there isn't one market out there, there are hundreds of thousands and the factors driving these markets vary from city to city, neighbourhood to neighbourhood, even from street to street. There is no question the Kelowna real estate market has cooled from its 2007 craziness. Based on local MLS statistics, of the 28 condo/apartment sales in January of this year (down 60% over 70 sales in January 2008), over 50% of these sales fell into the $200,000—$300,000 category. Looking at the residential detached home market, the trend continues with January 2009 showing a decrease in sales of 62% (55 sales in January 2009 compared with 145 in January of 2008). Based on January 2009 figures, of the 55 residential
home sales reported on MLS, 40% fell between $300K—$400K with close to 25% of those sales happening west of the bridge. Average price is not always the true reflection of the current value of given homes. In January 2008, 26 homes sold over $600,000 pushing up the average price. In January 2009, only 4 homes sold over $600,000 moderating the average overall price. In slower economic times, it is typical to see stronger activity in the lower price ranges. With BC and Canada now in the midst of a recession, concern for job security and declining net worth are major factors in the home buying process. Downward pressure on mortgage rates and lower home prices are providing much needed improvement
in home affordability and setting the stage for a healthier market in the years to come. Today’s more difficult real estate environment means a buyer and seller should be aware of the true up to date values, current environment and the future possibilities. They need to sort through the confusing array of information based on an intimate knowledge of the industry.