The Okanagan real estate market was hot in 2016 with prices reaching heights we’ve never seen before.
Now market analysts are forecasting how the market will look in the year ahead and it looks like things are about to change.
In 2016, low supply and high demand drove housing prices up a record 14 per cent across the board.
But according to RE/MAX’s 2017 Housing Market Outlook Report it’s a rate that likely won’t be sustained.
“We’re still going to see a strong market,” Elton Ash, Regional Executive Vice President of RE/MAX Western Canada said. “We’re predicting a 4 per cent price increase on average in Kelowna and overall sales will remain relatively strong as well.”
The reasons for the softening of the market, according to Ash, are two-fold.
The 15 percent foreign buyers tax established for Vancouver in August means fewer people are selling down there, and moving up here -and higher qualification criteria for CMHC insured mortgages are making it tougher for new buyers.
“We won’t get that same demand that we’ve seen in the last year,” Ash said.
But Ash resists saying that the Okanagan real estate bubble is bursting. He says what will happen in the next year will be more like a “soft landing.”
“Consumer confidence is very strong, our provincial economy is firing very well. We’re seeing lots of growth, job creation, the province to this point has been relatively well managed and we don’t see that changing,” said Ash.
The regional executive vice president of RE/MAX Western Canada says while some reports have predicted a huge crash in the housing market Canada wide, he doesn’t see it happening.
“There’s a lot of positive stuff going on in B.C., so despite fears about over-inflated pricing in the home market, it is really unfounded, especially for B.C.,” Ash said.