There were a total of 7,224 residential real estate transactions for the year of 2019 in the Central Okanagan, with a total turnover of $3.9 billion.
Total sales decreased by 2.3% year-on-year in 2018, and total sales decreased by 1.5%.
Nevertheless, the market still has a growth momentum in the second half of the year.
Buyers in the Okanagan region are still affected by government policy controls, such as mortgage stress test and speculation tax. The newly enacted policy aims to reduce housing prices in major Canadian cities. However, families that do not have home equity (mainly first-time buyers) have also been affected to varying degrees by the new regulation. In addition, due to the decline in oil prices and the shortage of oil pipelines will continue to have a negative impact on the prairie province, Alberta buyers are also stagnant, mostly waiting and seeing.
Thompson-Okanagan’s economic growth consists of many different industries. The region created 17,600 new jobs in 2019, the largest growth in the past 20 years. The booming forestry industry in the past is gradually fading. The recent permanent closure of Tolko Kelowna will have a certain impact on the local economy, but the growth in the categories of trade, logistics, commerce and professional services will offset its losses. The region’s technology industry also continues to thrive, and technology companies have become one of the main employers. Local companies such as: Bananatag System Inc, Straw house Inc have all been ranked among Deloitte Canada’s top 50 fastest growing companies of the year.
Although from the overall regional statistic, the overall sales in 2019 are lower than in 2018, but by comparing regions and housing types, we can still notice significant differences.
Detached single family house and apartment sales decreased by 3% and 7.2% respectively; the demand for relatively affordable townhouses increased by 13.1%. In the Shuswap / Revelstoke area, overall house sales fell by 10.7% due to double-digit declines in detached house sales, while in the North Central region overall sales fell by 0.7% and 1.7 due to decreasing demand.
Okanagan area has always attracted and retained excellent residents with a good reputation for living and work.
In addition, the tourism industry has become a major driver of local economic development. For two consecutive years, Kelowna International Airport has become one of the top 10 busiest airports in Canada. Over the next 10 years, the government is expected to invest $293 million to expand and upgrade airport facilities.
It is expected that the sales volume of residential real estate will still increase in 2020, mainly due to the continuously diversified economic model of the region and the growing population. The current interest rate is still close to historical places, and it is likely to decrease. Also, the federal government announced on Feb 18th 2020, it is easing the “stress test” for insured mortgages, which will be a significant benefeit for homebuyers.