Market Update

The Westbank area is currently recording a surge in multi-family construction activity. Expansion of infrastructure and pent-up demand are key factors driving the increase. The prospects of a new bridge across Lake Okanagan, new health care facilities and recent expansion of retail services have attracted more buyers to Westbank. Absorption has been steady, keeping inventories of completed and unoccupied units low. An estimated 80% of condominium units under construction have been pre sold.

     In Kelowna, detached residential starts of are on par with last year’s level. Buyers with equity from previous homes, including retirees, move-up, and move down buyers, remain the focus. Strong demand for upscale homes, rising lot prices, development costs and extended construction periods have continued to push up new home prices. The year-to-date average price for a new detached home has now passed the $600,000 mark. Construction has followed lot supply, shifting outward as municipalities extend infrastructure into new areas. Lake Country, North Glenmore Black Mountain, Kirschner Mountain and Shannon Lake have recorded the biggest increase in residential home construction activity. Lot prices have shot up in response to strong demand and tight supply and the $160,000-$175,000 price range now represents the low end in most new subdivisions.

     Strong demand in combination with rising supply has fueled this year’s upswing in sales activity. Active residential listings have jumped to a six year high as big gains in home equity have drawn more sellers into the market place, pushing up supply. High levels of construction activity have boosted both townhouse and apartment condominium inventory.

     Detached homes priced at less than $400,000 currently account for only 11 per cent of residential listings, down from 64 per cent just three years ago. Both townhouse and condominium prices are also up, year-to-date average prices increasing 15 and 14 per cent, respectively.
     Expect the pace of price growth to begin slowing as the market adjusts to rising supply and slightly reduced demand.

ACTIVE LISTINGS

Res.

Mobiles

Strata

Lots

SUMMARY OF RESIDENTIAL SALES

2007

2006

358

142

42

13

A FEW MORE REAL ESTATE STATS!

SALES BY TYPE
Year to Date

 2007 

2006

54

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The GST rebate provides a refund of 36 per cent of the GST paid on new homes priced below $350,000. The rebate is phased out, on a sliding scale, for new homes priced between $350,000 and $450,000. There is no rebate for new homes priced above $450,000.                                             The federal government is being urged to increase the GST rebate thresholds so that homebuyers in major urban centers are no worse off than when the GST was introduced.                                       The purpose of the commitment to index the thresholds was to protect housing affordability over time. With almost all new houses in some major centres now ineligible for the GST rebate, it is now essential that the federal government act on this commitment.