Kelowna Real Estate News

August 2023 Stats

The fires certainly had a profound effect on buyers and will be reflected in the sales numbers, but not as much in August’s stats as September’s. Our sales numbers effectively lag by 2 weeks, as most buyers have 2 weeks of subjects (conditions) before it’s considered sold. Sales and showings grinded to an absolute halt starting on the 18th after the fires crossed the lake. Forecasting ahead, it doesn’t look pretty for September. The good news is that we havn’t seen an impact on price yet, it’s holding steady at the moment

The most common question I’ve had is “How will the fires affect Kelowna’s market?”. It’s one I’m sure many have. September’s stats will likely reflect a harshly low number of sales and in turn, our inventory will start to climb (and already has). Short term, this will likely push us further into a buyers market for the winter, and cause downward pressure on prices.

That being said, come spring, it won’t stop people from wanting to live in Kelowna and moving. Humans seem to have short memory spans, especially when we look at the states that are constantly hit by hurricanes or earthquakes.  I’ve already had calls from buyers out of Vancouver looking to move here, and a Vancouver developer just wrote an offer on one of our listings this week to build out a 4plex down the road. Let’s also keep in mind, the last fire we had like this was 20 years ago.

 We’ve included a new Benchmark Price Trend arrow  showing the price trends averaged over the last 3 months as we need 3 months of data to form a trend.  Keep an eye on these arrows to see which direction prices are headed.

 SINGLE FAMILY HOMES

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 Benchmark Price Trend (3 months)
14% of listings selling 
80% of sales are under $1.3M

Listing inventory for August kept pace with where it’s been in relation to the 10-year average over the last couple of months, it’s 5% over the average, not a bad place to be! The sales side is where things have really begun to slide. I’m sure some buyers got cold feet once the fires jumped the lake and decided to walk away, but the sales numbers are 30% UNDER our 10-year average of 236 sales for August. The last time we had sales lower than our current 157, was in 2011 with 132 sales. This has pushed us back into a buyers market like we were in the winter. The luxury $2M+ market has certainly slowed with only 8 of 200 homes available selling in August (including Lakefront).


 TOWNHOMES 

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 Benchmark Price Trend (3 months)
21% of listings selling
80% of sales are under $850K

The townhome market seems to be holding steady at the moment, which isn’t surprising based on the more affordable price point. Inventory contracted slightly, and sales were about the same in August as they were in July. Sales are a little lower than I’d like to see them, but all things considered, they’re doing great and outperforming this time last year. With construction slowing this year, I expect townhomes to continue to do reasonably well over the winter.
 

 CONDOS

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 Benchmark Price Trend (3 months)
18% of listings selling 
80% of sales are under $600K

Condo listing inventory is holding relatively stable, and contrary to the rest of our segments, remains under the 10-year average, which is excellent! However, sales numbers have been on a steady decline since May where they were in line with our averages, but are currently 25% less than we would expect for August. In turn, the percentage of listings selling each month has also been declining since spring. This segment is the most volatile, but we also aren’t expecting any major projects to be completed shortly and flooding the market.

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Major Cities Report

Victoria

Victoria Real Estate Market In Need Of Better Housing Supply Mix 

A total of 544 properties sold in the Victoria Real Estate Board region this August, 13.8 per cent more than the 478 properties sold in August 2022 and an 8.6 per cent decrease from July 2023

“Our inventory levels, though up from last year, are still too low to support a well-balanced market.” said Victoria Real Estate Board Chair Graden Sol. “Most residential properties for sale in our market last month were single family homes – this type of property is generally at the top price point. Missing middle homes, such as townhomes and condos represented only 37.1% of listings for sale. Townhomes, which in my experience are what a lot of families hope to purchase, represented only 9.8% of the residential properties for sale. This imbalance in the mix of housing options means there is the potential for more price pressure on these types of properties because demand is concentrated at more attainable price points.” 

There were 2,490 active listings for sale on the Victoria Real Estate Board Multiple Listing Service® at the end of August 2023, an increase of 2.9 per cent compared to the previous month of July and a 16.5 per cent increase from the 2,137 active listings for sale at the end of August 2022.
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Vancouver

As summer winds to a close, higher borrowing costs have begun to permeate the Metro Vancouver housing market in predictable ways, with price gains cooling and sales slowing along the typical seasonal pattern.

“It’s been an interesting spring and summer market, to say the least. Borrowing costs are fluctuating around the highest levels we’ve seen in over ten years, yet Metro Vancouver’s housing market bucked many pundits’ predictions of a major slowdown, instead posting relatively strong sales numbers and year-to-date price gains north of eight per cent, regardless of home type.” said Andrew Lis, REBGV director of economics and data analytics

The MLS® Home Price Index composite benchmark price for all residential properties in Metro Vancouver is currently $1,208,400. This represents a 2.5 per cent increase over August 2022 and a 0.2 per cent decrease compared to July 2023.
Source

Calgary

August Sees Record-High Sales Amidst Historic Low Inventory

Thanks to a surge in the condominium market, August sales reached a record high with 2,729 sales. Despite the record levels reported over the past several months, year-to-date sales are still down by 15 per cent compared to last year.

“Higher lending rates have caused many buyers to either hold off on purchase decisions or shift toward more affordable products on the market,” said CREB® Chief Economist Ann-Marie Lurie. “The challenge has been the availability of supply, especially in the detached market. Inventory levels hit record lows in August, and while new listings are higher than last year, conditions continue to favour the seller, driving further price gains.”

The unadjusted benchmark price reached $570,700 in August, representing the eighth consecutive monthly gain. Prices have trended up across all property types, with row-style properties reporting the largest increase.
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Edmonton

High Demand For More Affordable Properties

Total residential unit sales in the Greater Edmonton Area (GEA) real estate market for August 2023 hit 2,250, increasing 21.8% compared to August 2022, dropping marginally from July 2023 by 3.1%. New residential listings were up 3.7% year-over-year from August 2022, and increasing 0.3% from July 2023. Overall inventory in the GEA was down 15.5% from August of last year, and down 2.7% from the previous month.

“It’s not unusual to see a lot of activity in the market before we head into the cooler months, but it seems that buyers are sending a clear message that smaller, more affordable properties are what they want right now,” says REALTORS® Association of Edmonton 2023 Board Chair Melanie Boles. “Unit sales for all categories are up from last year, but Row/Townhouses were the clear winner selling 50% more units than the same time last year and jumping 23.2% from the previous month. Condominium Apartment units continued to perform well, with units selling 25.1% better than August of 2022.”

The MLS® Home Price Index (HPI) composite benchmark price* in the GEA came in at $380,600, resulting in a decrease of 0.3% from July 2023, and a drop of 3.9% from August 2022.
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Toronto

Higher Borrowing Costs Continue To Impact Housing Market

Higher borrowing costs, continued uncertainty about the economy and Bank of Canada decision making, and the constrained supply of listings resulted in fewer home sales in August 2023 compared to August 2022. The average selling price remained virtually unchanged over the same period. On a seasonally adjusted monthly basis, sales and average price edged lower.

“Looking forward, we know there will be solid demand for housing – both ownership and rental – in the Greater Toronto Area (GTA) and broader Greater Golden Horseshoe. Record immigration levels alone will assure this. In the short term, we will likely continue to see some volatility in terms of sales and home prices, as buyers and sellers wait for more certainty on the direction of borrowing costs and the overall economy,” said Toronto Regional Real Estate Board (TRREB) President Paul Baron.

Greater Toronto Area REALTORS® reported 5,294 sales in August 2023 – down by 5.2 per cent compared to August 2022. New listings were up by 16.2 per cent year-over-over, providing some relief on the supply front, but year-to-date listings are still down substantially compared to the same period last year..
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