In the weeks to come, you may notice some changes, which are being made to better serve our clients. The first part of the change is the new real estate team name. We are now the "Selling Kelowna Real Estate Group". With all the changes we are hoping for a better aesthetic and usability for you, regardless of the changes, the one thing that hasn't changed is that we are still here to serve you.
David Eby's plan for the first 100 days in office is to nix the rental restrictions and age restrictions (other than 55+) in areas that are "in demand" of housing, to create an additional supply of housing. Kelowna is likely at the very top of that list with a vacancy rate of 0.6%.
From the Provincial press release on Monday, "....the Province is making amendments to the Strata Property Act to end all strata rental-restriction bylaws and to limit age-restriction bylaws so that the only permitted age restriction is to preserve and promote seniors' housing through the “55 and over” rule in strata housing. Some buildings have “19+ only” age restrictions that mean couples starting a family have to plan to move out as soon as they become pregnant......"
When looking at how much supply this will increase into the market for young families, in Central Okanagan right now there are currently 168 active listings that are age-restricted. As the new legislation does not include 55+ communities which make up 56 of those listings. There is more information needed to know this for sure, but as the Westbank First Nation has its own governing body, I believe it is safe to say they will not be affected by this change, right now 23 of these active listings are on WFN land.
We don't know if the legislation will pass, or what it will look like when it is implemented. It appears that with the information we know now, if the Government is successful in passing the laws it would increase the inventory in the Central Okanagan for young people and investors by 89 current total listings, which out of a total of 2,176 currently active listings is 4 percent overall increase in inventory overnight.
As right now, is only a snapshot in time and, we are heading into the normal seasonal slowdown where we see listings come off the market for the holiday season. In 2022, so far there have been 572 age-restricted sales, including 304 of which were 55+ and 60 of which on WFN land; leaving 208 sales that would potentially be subject to this change. In a market that has seen 4,579 total sales so far in 2022, the sales of age-restricted homes that likely would be affected by this change have accounted for 4.5 percent worth of sales in this market.
It appears in Kelowna, the overall supply would increase by around 4 to 5 percent for young families in the market. Typically in these complexes, the values are suppressed as there is less demand for young families and for investors. When putting the additional supply out there, this, however, is only a one-time fix, as when the supply is added and laws are passed it is one time and done, there are no more age-restricted laws to pass unless they plan to target the 55+ communities which are already in low supply.
I appreciate that they are trying to fix the root cause of the housing crisis which is the supply component, for 200 extra homes, this is only a one-time fix to the housing issue as if these laws are passed there will be no additional supply in years to come, these law changes are one and done. I am looking forward to the other implementations David Eby and the office is looking to implement, which in my opinion can have a larger impact on the supply to really address the housing crisis.
Some questions, I have been thinking about, is how long will it take for the prices to now become the same as others? is 5% enough of a change in inventory to bring down the prices for all other homes and condos?
Granted the government will also have some more information that we are not necessarily privy to like how many age-restricted under-55 complexes there are and how many units are in each. I have only focused on the select numbers that have decided to sell this past year and not on the potential of others out there.
Have a great week and reach out if there is ever anything I can do for you!
Mark
Mark Coons
Personal Real Estate Corporation
Mobile: 250-801-0361
Email: markcoonsrealty@gmail.com