This is traditionally the time of year for market optimism and without sounding rather cliché, there is some real statistical back-up to make you think that we’ve really turned the corner. 2013 turned out to be a banner year on both the resale as well as new home sectors.
The fundamental key MLS indicators of inventory levels, sales and prices all show significant signs of market recovery. Although there continues to be a scarcity of new home developments, a few projects faired very well.
Inventory Levels continue to decline significantly: The 9,696 active listings in the market have many realtors talking about a “shortage” of good, quality listings. Remember, in 2008, when there were 13,617 active listings? Well, this continues to decline year after year. Inventory levels have declined from the mid- 11,000’s in 2009 and 2010 to the mid 10,000’s in 2001 and 1012. Without any new offerings, this is destined to decline further.
Sold Listings continue in an upward trend: The most significant market strength indicator has increased significantly from last year. The 4,429 sales in 2013 are the highest sales since the 6,196 in the height of the market in 2007. This is the third straight year of sale increases which is a great sign going forward. Total sales from 2008 through 2012 were in the high 3,000’s however, this is the first year that the 4,000 barrier has been achieved representing a significant break-through.
Prices Remain Stable: The $386,289 average price is a slight decrease from last year, however, overall, prices remain stable and hovering in the $385,000 to $390,000 range year to year. It is encouraging to see sales increase dramatically without pricing being reducing.
There are some positive signs for the new home market with a number of projects fairing very well including two Tactx projects, Academy Hill and Mission Meadows; both achieving significant market success. There are only a handful of new, pre-sale projects in the market but with resale inventory reducing coupled with higher sales, there is going to be a demand as well as a need for new housing alternatives.
There is still some price resistance in the market, especially for concrete construction but there is opportunity for properly positioned low-rise apartment and townhousing projects.
I have attached below Central Okanagan Year-End statistical data from 2007 to 2014 illustrating trends of sales, inventory and average pricing.