The Okanagan real estate market went through extreme growing pains this year.
According to the Association of Interior Realtors (AIR) the market at the beginning of 2022 was quite pressurized due to an influx of people moving to B.C.’s Southern Interior.
“Wow, well the market is very different than it was this time last year,” said Association of Interior Realtors president Lyndi Cruickshank.
“As we moved into January and into the spring, we just saw an incredible number of people making big life choices and moving from where they were to where they wanted to be, which in a lot of cases was the Okanagan.”
However, active listings for Okanagan homes were at an all-time low and the supply could not keep up with the demand.
In February of 2022, AIR said inventory levels in the South Okanagan were down approximately 57 per cent from the same time last year, which was already substantially lower than years prior.
Despite active listings dipping to an all-time low, prices didn’t follow suit.
“Unfortunately for many people, it put them in a position where they were really struggling to be able to find a home because we had such a tight inventory,” said Cruickshank.
The market now has shifted again and more closely resembles the Okanagan housing market pre-pandemic.
One major change this year, however, has been rising interest rates.
“As we started to move through this year, and interest rates started to go up, some good things started to happen. We started to see more people being confident putting their homes on the market, it started to release some of that pressure,” said Cruickshank.
“The unfortunate part is it’s made it a lot more difficult for some people to purchase and it’s making it difficult for some people to maintain the financial commitments that they’ve had.”
Meanwhile, the government introduced a trio of new regulations this year including a three-day protection period to give homebuyers time to take important steps before buying a home.
The three-day period will allow buyers to secure financing and arrange a home inspection.
“The second, interesting change that’s coming on Jan. 1 is going to be a restriction of foreign buyers purchasing property in British Columbia,” said Neuhouzz Real Estate Group owner Sergej Sinicin.
“I think the intentions are good by the government, but is it enough to make the change in what they are trying to achieve which is to create more fully affordable properties to British Columbians? I don’t think it’s going to make a significant change and impact.”
New legislation was also introduced to remove almost all rental restrictions in condo buildings with the exception of buildings for people 55-plus, with in-home care allowed.
“I’m referring to that as the ‘Wild Bill 44’ because they presented it and then they passed it without substantial time for discussion to iron everything out,” said Sinicin.
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“And there were so many unanswered questions that were left on the table.”
Moving into 2023, both Sinicin and Cruickshank say it’s hard to predict what next year will look like following unprecedented times, market-setting moments and new regulations.
“My best guess is that locally here in the South Okanagan, we are still going to be okay, we’re going to ride out that storm,” said Sinicin.
“We’re going to see, hopefully, next year maybe in the second quarter, maybe in the third quarter banks are going to start dropping their interest rates. Buyers, consumers are going to start getting adjusted to the new normal, and they’re going to get back to the market right now.”
And if you decide to purchase or sell in the new year, Cruickshank recommends consulting a professional.
“I think no matter where you are, the most important element is affordability,” said Cruickshank. “You need to make sure the decisions you are making are the right decisions for you, at the right time.”
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