July sales of homes in the Okanagan Shuswap are showing some interesting trends

The July Real Estate statistics for home sales in the Okanagan, Shuswap areas are indicating some interesting trends.  The North and Central Okanagan; specifically Vernon, Enderby Armstrong and Lumby in the North Okanagan and Kelowna in the Central Okanagan are showing a consistent rise in all types of houses for sale. The Shuswap on the other hand is still struggling. As you can see by the graph attached the inventory is coming down and the absorption is rising in both the Central and the North Okanagan but there is virtually no change in most of  the  Shuswap statistics and inventory is actually rising. The 2 statistics that we use to best predict the future of the local real estate markets are the absorption and the inventory. The inventory is simply the total number of homes on the market. The absorption is best explained by a hypothetical example. If there are 1000 houses for sale in the Central Okanagan in July and 100 of them sell in July, then the absorption rate would be 10% for the month of July. An absorption rate below 10-12 % is considered a buyer's market; 10-15% is considered a balanced market and anything above 15% is considered a seller's market. These 2 statistics are the indicators of supply and demand and therefore are our stongest indicators for what is happening to house prices. We also have to remember that each month has to be compared to the same month of the previous years because the market has a regular cycle it goes through each year. Consequently when we look at the graph below, Kelowna or the Central Okanagan is in a secure, balanced market, Vernon or the North Okanagan is struggling to get into a balanced market from a buyer's market and the Shuswap is still very much a buyer's market. One possibility for an explanation for the Shuswap lagging behind the other 2 areas is the flooding that occurred in the last couple of months. Some of the potential buyers for the Shuswap could very well have lost confidence in the area because of the disastrous flooding that occurred. Whatever the reason is the statistics don't lie. However, when we separate Salmon Arm from the rest of the Shuswap we discover that Salmon Arm is recovering at the same rate as the North Okanagan. This gives further credibility to the theory that the Floods in the Sicamous area gave the home sales a little temporary kick backwards. The Shuswap is one of the most beautiful areas on the planet. They may be slightly lagging behind in their recovery compared to the rest of the Okanagan, Shuswap but it will be a very temporary set back. But you always have to remember that is only the world according to Bill. (July statistics for the Okanagan Shuswap)

Bill Hubbard,

Broker/Owner of:

 Century 21 executives Realty Ltd. Vernon and Enderby

Century 21 Assurance Realty Ltd.  Kelowna


 

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