September was a fantastic month for the real estate market in Kelowna and the Central Okanagan Valley. The crisp autumn air is definitely upon us but it’s almost as if real estate is heating up. Our market tends to slow down month-to-month as we move closer towards the end of the year and while that is true as well for this year, September sales were up 11.54% compared to September 2018 and for single family homes we actually saw more transactions than we did in both 2018 and 2017! Condo sales were down significantly to 88 from August’s 127 which is also 6.38% behind September 2017. This means that condo inventory actually increased, the only segment to do so. Interestingly, condo sales dropped fairly substantially in both September 2017 and 2018 as well but both of those years still saw decreasing inventory levels. Perhaps this surplus of inventory will spur October condo sales. Townhouse sales were down slightly to 68 from August’s 79 but is maintaining momentum over last year, up 47.82%. Overall, townhouse sales are up 13% year-to-date from 2018.
September saw a total of 406 residential sales and ended with a current inventory of 2578 or 6.35 months of inventory. Conditions are fairly similar to this time last year when we had almost the same amount of inventory. The difference - sales are on an upward trend compared to last years downward trend and we are experiencing a slightly more balanced market because of that. The inventory or number of homes available for sale is down 6.39% from last month which again is typical of this time of year and expected to continue as we move through autumn and the beginning of winter. A definite change from the past few years is the time it takes for homes to sell which is currently an average of 73 days on market. By comparison, at this time in 2018 and 2017 we were seeing homes sell in 58 and 53 days on market, respectively. For sellers, don’t get discouraged when it takes longer for your home to sell. As long as you advertising at a price that reflects your homes actual current market value your home will sell. If you’re looking for a quick sale, you may need to sharpen your pencil but consider all the options from how you are marketing to how you might structure a possible deal before you simply drop the price.
Central Okanagan Avg. Selling Price for Past 12 Months by Market Segment
The real estate market in Kelowna and the Central Okanagan Valley are once again experiencing record high valuations, rising 6% from last month and 4% from this time last year. In September the average residential property sold for $605,651. This is an all-time high, not considering the anomaly we saw in July of last year when the average selling price was up $641,006 (but then dropped to $568,210 the following month). This is great for sellers going into the autumn selling season but of course perpetuates the affordability challenge many home purchasers are experiencing. The average valuation of single family homes stayed mostly still with just a tiny drop to $712,371. On trend with much of this year, the largest valuation increases were seen in the condominium segment rising 8.2% to $387,569 and the townhouse segment rising 6.17% to $533,253. This is a record high for townhouses having surpassed the previous record by several points.
With a new selling season upon us I wanted to take a look at which homes are selling quickly. Two years ago in September 2017 there were 44 homes sold after just 2 weeks or less on the market. That number has dropped down to 22 homes for September 2019. I was curious to know if there was anything consistent between those homes where this select group of 5.4% of sellers were able to realize their goal so quickly. It turns out there was little in common outside the trends that we see in our market such as 40% of these quick-sellers were priced between $500-600,000. hat’s not to say that your higher priced home won’t sell quickly. There was a home on Hobson Road in the Lower Mission that sold for just over $1.7 million in only 13 days and a $1.8 million dollar lakefront estate in Lake Country that sold in just 10 days on the market! Without taking a deep dive into each sale it is very difficult to accurately analyze the value to the price of each transaction; however, I thought it was worth noting that all but one quick-seller sold for very near or for more than their BC Assessment value with many selling for quite a bit more. The BC Assessment value is not an accurate reflection of a properties current market value on its own but when comparing how multiple properties are priced in relation to their BC Assessment value we can identify trends; in this case the trend being that the current market value of these quick-sellers is not likely to be at a discount rate. It was likely a combination of factors including sheer chance that the right purchaser showed up at the right time that allowed these 22 homes to sell so quickly. The truth for most sellers is that with the current market conditions and the fact that we’re moving into a slower season a sale is likely to take 2-3 months or longer. Below is a look at how price category is currently impacting the time it takes for homes to sell:
Priced Under $400,000 - Homes sold on average after 65 days on the market
Priced from $400,000 - $599,000 - Homes sold on average after 79 days on the market
Priced from $600,000 - $799,000 - Homes sold on average after 70 days on the market
Priced from $800,000 - $999,000 - Homes sold on average after 87 days on the market
Priced from $1 Million to $1.25 Million - Homes sold on average after 86 days on the market
Priced from $1.25 Million to $1.5 Million - Homes sold on average after 118 days on the market
Priced Over $1.5 Million - Homes sold on average after 100 days on the market
This is good insight but I can’t stress enough the importance that sellers seeking to set accurate expectations look at more detailed data with regards to their neighbourhood and specific home details. For example, looking at the table above, homes selling for between $1 Million to $1.25 Million (In September) sold on average after 86 days on the market. Homes in this price category in Black Mountain (in the past 6 months) sold on average after 446 days on the market. This substantial difference means the requirement of not only different expectations but also a different marketing strategy.
All data is from OMREB/MLS® System. Interpretations of the data is done with the utmost care and attention, however, errors and omissions may apply. Selling and purchasing real estate comes with risk and should be discussed in depth with your real estate agent of choice.