What this 'affordable' Kelowna home will cost you
With the benchmark price for a townhouse in Kelowna pushing past $750,000 in March, there’s not much on the market for the entry-level buyer wanting a bit of a yard.
A new listing on Hein Road might show how overheated the market has become.
Hein Road is a one-block long street in Rutland, not far from the intersection of Highways 97 and 33. While the City of Kelowna and some residents have tried to improve it over the years, it has a long history of being a run-down street and home to some notorious characters, ranging from drug dealers to killers in the past.
Now, you can buy a three-bedroom, one-bathroom unit in a fourplex at 482 Hein Rd. for $429,900. It was built in 1972 and was assessed at $258,000 last year.
It’s described by the listing realtor, Jason Puetz, as having a total of almost 1,800 square feet, with 1,048 of it finished, a basement door that leads to a large, fenced back yard and room to “park multiple vehicles on your property right at your front door!”
The listing comes complete with a photo display of some very crowded indoor rooms.
Puetz declined to be interviewed for this story.
“This neighbourhood has great investment potential as new development is springing up around it,” the listing states. “The future is looking bright. Super handy location in the city near stores, bus route and UBCO. Lots of accommodation for the money compared to what's on market today.”
While the wording could be considered an embellishment, it’s actually quite accurate.
On Jan. 21, 2020, Kelowna city council approved a development permit for a 24-unit, 4.5 storey apartment building on a duplex lot on the south end of the street.
That permit was only good for two years and the project did not go ahead. The permit is now expired but it shows what could be done there.
Two properties sold on the street in 2021. A fourplex at 400 Hein Rd. fetched $930,000, according to B.C. Assessment.
A 1,071 square foot, two-bedroom, two-bathroom unit in the fourplex at 380 Hein Rd. sold for $347,000 in June 2021.
Given that history, plus the fact that townhouse prices have risen by about 19% since that time, the price for 482 Hein Rd. is not out of line in today’s hot real estate market.
But can you even afford it?
With a 20% down payment (about $86,500) and a five-year fixed mortgage at 3.89% on the balance, the mortgage will cost $1,789 per month.
According to CIBC’s affordability calculator, to qualify for such a mortgage a person (or couple) needs to earn about $89,000 a year.
For one person, working a 40-hour week, that translates into an hourly wage just under $43.
That’s not within the reach of most Kelowna residents. According to the City of Kelowna, citing data that was last updated in July 2021, the median household income in the city is $68,627.
On the other hand, with one-bedroom rental apartments in Kelowna averaging $1,710 a month and two bedrooms going for $2,260, the townhouse at 482 Hein Road might just be a good deal for someone who can scrape together the down payment.
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