Balance in Kelowna Housing Market
By Andrew Smith, Royal LePage Kelowna
If you’re a first or second time buyer thinking of buying a home in Kelowna over the next few months you might be in for a little surprise. Not a big one because I’m sure you’ve done plenty of research but probably a little one. You will notice a lot of "For Sale" signs throughout the city, 1,655 of them to be exact, so it appears that the world is yours.
Slicing and dicing the numbers paints a different picture. Most first or second time buyers in this community look for housing priced under $500,000 which eliminates just under a thousand homes from their search bringing the number of available homes to 681. Still a reasonable number of homes to pick and choose from but once you go into the house you’re going to find out that these are the same homes everyone else is looking at which creates a little more urgency which we haven’t seen for a while.
“Let me think about it for a few days” isn’t a great strategy because there’s a pretty good chance someone else looked at the same house, as well as the others you’ve already seen, and is already two or three days into their “thinking about it” process. We’re not in a market where you have to write an offer on the hood of a car in the driveway but you can’t go on vacation and expect that home to still be for sale.
At a rate of 106 Kelowna residential sales per month under $500,000 for the past 6 months (and this includes the slowest months of the year) we have just over 6 months of inventory available. This segment is just a good long weekend away from being a balanced market which is the healthiest of all markets. Balanced markets mean sellers who price their homes accurately will generate showings and offers while overpriced homes get passed over.
Home buyers who find an affordable home in a neighbourhood they like aren’t going to get anywhere with low-ball type offers and waiting for a price reduction from the asking price isn’t a prudent strategy today. Let’s hope this continues for a long time because now that first timers are kicking into high gear it reverberates through the rest of the housing market bringing long overdue confidence into the rest of the housing sector.
Let’s go over the basic rule for first time buyers. Get pre-approved for a mortgage. Most know this by now but it’s critical to know how much a lender will lend you and you can then determine how comfortable you are with the monthly payments. This part of the process should be done before you start looking at homes because it eliminates disappointment if you have to reset your house search criteria.
Things are still tough for those among us trying to sell their high priced homes. There are 974 homes for sale over $500,000 and we’ve generated 333 sales over the past 6 months. We’re a long way from a balanced market with 17 months of supply but with prices climbing there’s reason for some optimism here too. There have been 261 homes sold so far this year over $500,000 compared to 161 this time last year. That’s a huge increase over 2013 but the stubborn problem of too many other homes for sale remains for these folks.
If you are thinking of entering the Kelowna real Estate market this year ask for my “Free First Time Buyer Package” and list of the Best Buys Andrew Smith.
Learn more at OkanaganBC.com.
This is a guest blog post by Andrew Smith. Andrew is a REALTOR with Royal LePage Kelowna.
He is not an employee nor an affiliate of Mission Group. Read the original article here.