Okanagan Shuswap Real Estate prices beginning to move

The market continues to improve and it looks like prices in most property types and price ranges is starting to creep upward. Keep in mind the 3 most important stats to assess and predict the Real Estate Market are Absorption, Inventory and Sales Activity. The inventory is now dropping and the absorption and sales activity are rising in all three zones. This points to rising prices in the future. These stats are changing slowly so the change in prices will be slow. Although price is important it is very difficult to determine. It is so easy to make prices say whatever you want and there are so many people seemingly qualified to quote market statistics that really don't understand the mechanics of Real Estate Prices. Overall average price is a ridiculous statistic to use to try and decide what is happening to prices. I read yesterday from a seemingly credible source in our business that "prices were surging upward in the Okanagan". That is a pile of bunk in my ever so humble opinion. For instance, right now I would suggest that lower prices are actually starting to rise slightly and higher price ranges have just stabilized or are still dropping slightly. Therefore, overall average price in any given marketplace cannot accurately predict what is happening to any given price range. I have found that using an HPI (Home Price Index) created from our own MLS system works best. In other words we do a search in any group of areas close together and within a broad price range then compare date ranges. For example, in our MLS system, if I do a residential search and choose the Upper and Lower Mission in Kelowna, built since 1990, choose sold single family listings only from Feb. 1,2013 to Feb. 1, 2014 I get 257 sales with an average price of  $719,969. Then if I simply change the date to one year prior I get an average price of $695,184. That tells me, a little more accurately, what the average price in Upper and Lower Mission is and that Prices have risen slightly from a year ago. If I do this same exercise for Lakefront homes in the Kelowna area  it tells me that prices are still dropping. This average of an HPI is much different and more accurately portrays what is happening in that area than an overall average price. Call or email one of our Realtors and have them do an HPI assessment on your property. When a client asks a REALTOR what is happenning to prices in any given city the true but annoying answer is, "That depends". 

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Bill Hubbard

Bill Hubbard

CENTURY 21 Executives Realty Ltd.
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