Okanagan Shuswap Market Review for June of 2019

 
Isn't it bizarre that we have 2 quarters of 2019 under our belt. For the stats junkies the stats machine is attached. For the lesser-obsessive folks I have a summary graph below for how the 3 zones, North Okanagan (Vernon Area), Central Okanagan (Kelowna Area) and the Shuswap (Salmon Arm, Sicamous areas) compare to first 2 quarters of last year for price, absorption, sales and Inventory. There is also my general summary below. A few  points before we start...
  •  Absorption is the percentage of residential inventory that sells on a monthly basis. 
  • Remember that these statistics are just residential statistics as reported by the Okanagan Mainline Real Estate Board (OMREB). For the Realtors in the Group, these stats are on page 5 of the quick summary in the monthly report from OMREB. 
  • We use these statistics because most people are most interested in what is happening to the price of their home and these statistics tend to lead the trends in the market.  
Market summary for  the first half of 2019:
First, the market is remaining steady to our predictions of a flat or soft correction for this year.  Even though most of the stats report a decline, the absorption which is the stat that illustrates the balance of supply and demand is still above the norms for a balanced market. Usually a balanced market will have an absorption of 12 to 14%. All 3 zones are slightly above that. The other factor is that Realtors are still reporting heavy competition in offers below $500,000 in the North and Shuswap and below $600,000 in the Central Okanagan. In general, Buyers in these price ranges are still having trouble finding decent, well priced, listings to buy that do not already have offers on them or there are competing offers with theirs. Overall the markets in the Okanagan Shuswap are the best that they can be. In other words they are strong but sustainable. We must be careful not to compare too heavily to markets like 2007 and 2016 and therefore look at our present day market as busting. 2007 and 2016 were not normal markets. They were booms. We are now steady and balanced.
 
Also for the first time in a couple years the major centers across Canada are showing very small tidbits of optimism. I caution you that these shifts are very "tiny" so far and certainly do not indicate a trend yet. Vancouver, Edmonton Calgary and Toronto have been in a downward spiral for a few years. 2 years ago there was nothing but negativity to report in these markets. Now...
  • Vancouver reports sales leveling off and a slight increase in sales in certain segments of the market (Condos)
  • The same news is reported with the Toronto Real Estate Board
  • Edmonton is reporting an increase of sales YTD for the first time in a while but Calgary sales and prices are still inching down
The other thing to note is that as each market starts to shift you can "smell" it. That is my technical term for it. :) It's like a little whiff of your wife's cooking as you come up to the door from work. You are not yet sure what's for dinner but it smells good. 2 years ago the news was all negative. We were dealing with the B20 stress test, rising interest rates, clamp down on foreign investment (debatable whether that is a negative), new creative tax increases in BC for home owners and buyers etc. What do we have today...
  • Interest rates are inching down fairly aggressively
  • CMHC has instituted an aggressive first time home buyer's program to start on September 2
  • As stated above Canada's 2 major economies are showing very slight signs of recovery
What this tells me is that the white collars sitting in their ivory towers of the major lenders in this country are feeling reserved optimism as well. They must smell my wife's dinner and it's smells good. 
Have a great month.
 
Statistical comparison of Jan-June 2018 and Jan-june 2019. 
 

 

Central

Central

North

North

Shuswap

Shuswap

 

Jan-Jun

% Change

Jan-Jun

% Change

Jan.-June

% Change

Avg. Price

$639,792

-5%

$489,578

+4%

$436,042

-4%

Absorption

14.8%

-30%

19.3%

-20%

15.3

-16%

Sales

163

-15%

81

Same

39

-15%

Inventory

1067

+18%

413

+31%

245

Same

 
 
  

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