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House sales fell in a majority of markets across Canada in June, suggesting the real estate sector is cooling just as interest rates are starting to climb.
“I would say statistically we are seeing a slow down in sales, it's evident from the numbers that overall unit sales are down from June last year," said Dean Desrosiers of Century 21 Realty.
“However, a lack of inventory in the Kelowna market is causing homes to sell faster this year. The total days on market was around 50 days in June 2017 compared to 61 for June of 2016.”
According to Desrosiers, this lack of inventory is causing some homeowners to hesitate when putting their home on the market for fear of not being able to find a suitable property to move to after selling.
This lack of inventory stems from slow building years between 2009 and 2014 during the real estate market downturn.
“People can sell their house to somebody moving into the area, the problem is they don’t have a house to move to. There are no new neighbourhoods with 3 yr old homes to buy. So we're seeing an inventory induced slow down in sales, because there simply aren't suitable homes for people to go to once they sell their property,” said Desrosiers.
The lack of inventory correlates in less interesting properties on the market as well, which when combined with higher prices due to low supply, will result in a drop in sales numbers.
According to Derosiers, a change in provincial government combined with flooding and now wildfires in the area may be having an honest effect on home sales as well.
Overall, the average home price in the Okanagan region does continue to rise coming in at $716,000 with a median of $644,000 for June 2017 compared to $612,000 against the median of $569,000 for June of last year.
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