What drives prices?

We have learned over the years that there are 5 statistics that are the  best indicators as to what is happening in the housing market. They are inventory, absorption, days on the market to sell, sales activity and of course prices. But the interesting thing is that prices are the last statistic to change. it's like the statistics are set up as dominos and the last domino to fall is price. Basically, the Real Estate Business in the Okanagan, Shuswap is like any other sales business. It is driven by supply and demand.  Prices don't start going up until the supply gets low enough that multiple buyers are bidding on the same house. This often results in the house selling for above the listed price. When the incidences of multiple offers increases then prices begin to rise. From 2006 to 2010 our inventory of houses for sale in the Okanagan Valley doubled. This is why we saw a price decline from 2008 to 2012. In the last 2 years inventory has been gradually dropping again. It has now dropped to a critical mass where the multiple offers are happening in greater frequency and prices are starting to rise again. It's a great time to buy so get in while the getting is good. 

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