Welcome to 2016!
How good can it get? Inventory levels steady at approximately 10,000; sales closing in on 6,000 and average price increasing to over $425,000. This is all fantastic news for the resale market but will it translate to the New Home market?
The following statistical information (MLS year-end listings, sales and average prices from 2007 through 2015) illustrates positive resale trends – note the link of statistics and trend graphs below. (I have included 2007 as a peak period benchmark and excluded 2008 through 2010 as we all know what transpired during these years).
Inventory Levels Remain Stable: Year to year inventory levels continue to remain constant at approximately 10,000. This suggests stability and with sales continuing to increase this should lead to continued price increases.
Sold Listings Closing in on 6,000! The 5,787 sold listings in 2015 represented the highest volume of sales since the 6,196 sold in the peak period of 2007. Throughout the years, sales inched their way from the mid-3000’s to over 5,000 in 2014 to the 7.8% growth experienced in 2015. Will we reach 6,000 in 2016? There are way too many variables to consider to answer that question but it’s good to be optimistic.
Prices Continue to Rise! Average price in 2016 reached $427,494, and increase of 2.1% from 2014. However, this is the second consecutive year of prices averaging greater than $400,000. Will this trend continue and what effect will it have on sales should it continue?
New Home Sector. New homes has come a long way in the past couple of years. With limited new introductions previously, there are a number of new projects to look forward to in 2016. The apartment condominium sector (low-rise) is somewhat under-supplied at the moment which is evident with increased prices for remaining inventory. There are a number of townhome and duplex projects, although inventory is getting diminishing. The single family sector remains quite steady with large scale communities reporting solid sales.
Look for new low-rise apartment and townhome introductions this year in both Kelowna and West Kelowna. It appears there may be new hi-rise projects coming on-stream in the new year, although pricing would need to be sharp as there remains a strong correlation between cost to build and achievable selling prices.
Tactx has already experienced new home sales success, both in product sales but also at higher prices. Tactx is very excited at the opportunities that exist in the Central Okanagan and look forward to new introductions in 2016.