Home sales in Kelowna dropped 21 per cent in 2018, and, according to the Canadian Mortgage and Housing Corporation’s (CMHC) Spring Housing Forecast, sales will remain flat for the next two years.
“Now we’re getting to the point where we’re seeing those inventories rise in the existing and new home market,” said Taylor Pardy, Senior Economic Analyst at CMHC. “It’s giving buyers a little bit more choice. Actually, on the consumer side, it’s a good thing.”
Pardy released his report Wednesday afternoon at the Canadian Home Builders Association (CHBA) of the Central Okanagan’s luncheon in Kelowna.
Members of the CHBA said they worry government policies, such as the new mortgage stress test and the speculation tax, are further driving down demand in the Central Okanagan.
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“What concerns us, from the Canadian Home Builders perspective, is we have three levels of government trying to make adjustments and the combination of all three leads us to believe we’re not sure where the bottom is,” said Roy Wynsouw, a director with CHBA and president and general manager of CorWest Builders.
But according to the senior economic analyst at CMHC, it’s the slowing population growth that’s having the biggest impact on the housing market.
“We’re not going to see the kinds of growth above two per cent that we saw from 2014-2016, but about 1.6 percent for the next few years,” Pardy said.
As for housing prices, the CMHC expects them to stabilize, or even drop slightly, in the next two years.