The commercial Real Estate market in the Okanagan Valley still remains sluggish

The commercial Real Estate market in the Okanagan Valley still remains sluggish. Commercial will likely be the last property type to recover as we march through this cycle from a recession into a positive market. When a market goes through its cycles in a certain area it usually corrects from the top down and recovers from the bottom up and commercial Real Estate is considered to be at the top. What that means is that when we are at the peak of any cycle the property types that begin to slow first are higher priced residential and commercial properties. Lower priced properties tend to hold their value longer. Then the opposite is true for the process of recovery. The lower end tend to come back first and the higher end residential properties and Commercial properties tend to recover last. A good example of this is noticeable in the North Okanagan and Shuswap area of the interior of British Columbia. This market had one of the biggest and fastest rises in Real Estate activity and prices in history between 2004 and 2007. Then in January of 2008 things began to slow and eventually prices began to drop. We call this a correction. The properties that dropped the soonest and the most were higher end Residential Real Estate and Commercial sales and leasing. Now we are into the turnaround of that correction which we call recovery. However, what is recovering is the low end residential market. The Commercial Properties and the higher end residential properties will not begin to come back till 2013 or maybe even 2014.

Bill Hubbard

Bill Hubbard

Broker/Owner
CENTURY 21 Executives Realty Ltd.
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