Ready for spring yet? In real estate spring is the season when normally we see the highest amount of listings come on the market, the caveat in the recent market, of the last couple of years, is how much demand is there to keep up with it. It appears peak listing season is starting right on queue. In the last week, we have seen roughly around 100 new listings hit the market than what came up on a weekly basis for Winter. The sales are often a lagging indicator and will continue to be watched as new inventory hits the market and more options are out there, we are seeing fewer subject-free offers, really in the next couple of weeks, we will have a good idea of how demand is holding up with the increasing supply.
For the Central Okanagan, the average sale price to list price has remained at 100% for January and 100.1% in February, really not changing at all from what we saw in 2021. So far in March, we are seeing the number slightly increased to 100.6%. However, as we see the inventory rise this spring, this ratio is good to watch as it gives good insight into competition (or demand) on each of the homes and we can break it down to each mini market (apartments, acreages, single-family homes) and even location and neighbourhood. If you have questions on specific areas reach out, that is what I am here for.
Currently in March, for the total volume in sales, we are sitting at $311M on 328 sales for the Central Okanagan. In comparison for the entire month of January, we had $351M in sales on 420 sales, and February had 589 sales for a total volume of $553M. The total volume is only one factor to look at as we have experienced low inventory, it is tough to know where the actual volume would be if we had more inventory.
There are a few noticeable differences that might be different this spring compared to last spring, one of which is the increase in interest rates that happened earlier this month. BC Real Estate regulator(BCFSA) looking to implement a number of new measures to slow down the market including a mandatory 5 day listing periods before a home can be sold, and potentially the 'cooling-off period'. Those both are direct measures governing bodies, looking to put in place to slow down the real estate climb. A little more indirect effect is the Covid-19 restrictions being lifted earlier this year, which may encourage more travel to the Okanagan this spring vs last year. Not to mention the world politics playing a role.
Everything right now in real estate in the Okanagan is hedging on supply. Right now there are 1061 active listings in the Central Okanagan. Compared to last year we are down from last March's inventory of 1401.
Now getting into the prediction for this spring market, I expect prices to continue to increase and inventory to continue to be depleted. The demand we are currently seeing continues to deplete, supply keeping the upward pressure on pricing. As we are in the shoulder season, as a buyer, now in my opinion, a good time to look for your next home before more demand comes, which will be expected in April, based on highways being safer to travel and opening up, and more visits from Vancouver/ Alberta. Last week I mentioned it in my email, but we are seeing the amount of competition on each property slow down a bit, demand is still there but more listings are coming out giving more options. What might change this spring, compared to the last year, is the demand from Alberta. Looking at the real estate market, there the market seems to have taken a turn and appears to be one of the hottest markets in Canada right now. Alberta makes up about 8-10% of our buyers, but as restrictions are lifted and the market there is hot, I would expect that to increase.
The biggest thing to continue to watch is inventory right now, heading into fall when it is normally a good time to sell in the Okanagan, it might be a good opportunity as a seller to take advantage.... That being said, you will need a place to go, so not as easy said as done but something to think on, and buyers these days aren't being as picky on terms in the contract, you as a seller can also get a rent back option or a longer possession date, to give you time to find your next home without needing to move 2 times.
Have a great week and feel free to reach out with any questions, or if you have any predictions on the real estate market. I love hearing other people's opinions. ~Mark.
Mark Coons
REALTOR®
(250) 801-0361