Central Okanagan real estate has slowest August since 2011
Kelowna realtor Scott Aaltonen says every summer he normally takes at least three groups of out-of-town buyers on real estate tours to check out properties in the $2 million price point.
This year he hasn't done a single tour.
"Everybody cancelled and they are just waiting to see if we have another natural disaster... or a new (government) policy to restrict (them)," he said.
Aaltonen said since the COVID real estate bubble burst in spring 2022 the market has been on a downward slide.
"I've seen this happen every four to five years, we have a rally of 15% to 25% and everybody seems to think it's going to continue and that buying real estate is a very simple equation, but eventually the economy and the greater marketplace catches up with us," Aaltonen said.
The Re/Max Kelowna realtor said buyers are taking a wait-and-see approach unless they find something that's unique or aggressively priced.
His comments come as recently released figures show it was the quietest August in the Central Okanagan for sales in over a decade.
Numbers released by The Rennie Advance say it was the slowest August for sales since 2011, and saw a 20% drop from July, which is three times that of the typical drop from July to August of 7%.
Sales across all types of housing in August were 38% below the 10-year average for this month.
While the numbers sound extreme there were still more homes sold in August than in February.
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Royal LePage Kelowna realtor Joe Ungaro has been in the business for more than 40 years and is skeptical of the numbers.
"I think we should break the market down because it just confuses people if we just give broad brush (strokes)," Ungaro said.
He points out that in the single-family residential market, which he says is the "bellwether" of the whole market, sales in August were almost identical to 2023.
What has changed is the amount of inventory on the market.
"We had 1,129 (single-family) homes on the market at the end of August a year ago. There are 1,611 today," he said.
Ungaro thinks a large number of land assembly sales – where two or three properties are sold together for development – may be skewing the inventory numbers.
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While the drop compared to the 10-year average at 38% sounds extreme, peaks in 2016 and 2017, as well as 2020 and 2021 appear to distort the figures.
The report said single-family home sales were down 4%, townhomes down 18%, and condos down 12% compared to August 2023.
Taking out the single-family homes, which may be part of land assembly sales, inventory is still up in the townhome and condo market with increases of 37% and 46% respectively.
While the increased inventory may sound like good news for buyers, prices have stayed stubborn with little change.
The price of townhomes in the Central Okanagan are up 5% with condos and single-family homes dropping by just 4%.
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