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November 19, 2020 - 7:00 AM
It’s not just low interest rates that are pushing the Interior real estate market to greater heights.
Some sources are saying that the shift to working from home because of COVID-19 may be an even bigger factor.
“Clearly, exceptionally low interest rates are keeping the market’s wheels well greased at this stage,” states a new report from RBC. “Yet work-from-home is possibly an even more powerful driver of activity.”
Kim Heizmann, president of the Okanagan Mainline Real Estate Board, won’t go quite that far since interest rates are a huge factor, but did tell iNFOnews.ca that the work from home movement is a major player.
“People have reassessed their housing, because their housing has become their offices, their gyms, their schoolyards, their backyards, everything, due to the lockdown,” she said. “Everybody has done a lifestyle evaluation. We believe that’s one of the factors that is pushing the market.”
Resales of existing homes has gone up 32 per cent in Canada so far this year, the RBC report says, with Montreal leading that way at almost 36 per cent and Vancouver close to 31 per cent.
“A number of current owners are opting to move, something they wouldn’t have contemplated had it not been for COVID-19,” the RBC report states. “With commuting to work less of a factor, many Canadians are drawn to more affordable suburbs and smaller markets away from core urban centres —driving up home resale activity significantly in these more distant areas.
“And with travel abroad likely restricted for some time to come, other Canadians are looking to buy vacation properties to get away from it all. Cottage country and other smaller markets have recorded some of the stronger resales gains so far this year.”
The report doesn’t break sales down to smaller communities but both Kamloops and the Okanagan regions showed significant increases in sales and prices this year over last year.
READ MORE: Housing prices and sales continue to soar in Kamloops and Okanagan
“Kamloops is in the middle of a growth spurt,” Dave Jones, the City of Kamloops business licence inspector told iNFOnews.ca. “It’s the last hidden gem in the Interior. Developers are starting to recognize they can come in and develop some land and make money here.”
Single-family housing prices are about $200,000 lower in Kamloops than Kelowna but are climbing in both cities due to a lack of new listings.
There is, of course, no way to tell how long this boom will last but, there is getting to be a shortage of supply in the form of new listings.
“We’re still surprised it’s done what it’s done,” Heizmann said. “We’re going to have to see quite an influx of listings in order to change the type of market because we are so low in our inventory numbers.”
But, there’s a hesitancy for some people to list their homes.
“One of the concerns with some sellers is there’s nothing to go and buy,” Heizmann said. “The fear is they don’t want to put their house on the market if there’s nothing to buy.”
That, combined with big city people relocating to work from a quieter home environments, will likely keep prices going up.
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