The average price of a single family home in the North Okanagan fell by about 1% to $382,665 in 2011 compared to 2010 (see graph below right). That is much less than anticipated considering the low number of sales this year and the high number of homes for sale. To give you some insight into the decline in sales activity this year compared to previous years please see the graph below left. It shows the total number of single family sales for each year since 2007. As you can see there were around 1150 single family sales in 2007 and then the hammer came down. There was a bit of a surge in 2009 when sales topped 820, but since then sales have declined to a low of only 632 in 2011. Essentially, sales have dropped off by almost half this year over 2007!
Strata Homes (Townhouses and Condominiums)
Strata home sales in 2011 were below 2010 levels and resulted in a slip in the average sale price of about 10% to $234,090 (see chart, below right). While prices held their own between 2008 and 2010, it looks like the high number of listings and the low sales per month have taken a toll on Sellers. It was again, a Buyer’s market for strata in 2011.
It was a great year for those people who bought homes, particularly strata. There were some investors who picked up large numbers of rental units for their portfolios last year. There were even some Realtors buying rental homes, which is always a good indication that it is a good time to buy!
The large number of foreclosures last year in the North Okanagan (91) is an indication that more people than in recent memory are not working enough to support their homes. While this is a large number for this community it is very small compared to the total number of homes owned. Still, high foreclosure numbers indicate lower community economic strength. When the number of foreclosures starts to decline, our housing market should begin to recover.
The CMHC predicts that in 2012:
1. Demand for new and existing homes will strengthen in 2012. Favourable mortgage interest rates coupled with stronger employment growth will support modest growth in demand for housing next year.
2. Sales of existing homes are expected to increase 11 per cent in 2012. Home buyers will continue to benefit from an ample supply of listings available for sale.
3. Expect existing home prices to edge up by three per cent as demand improves and the supply of listings is drawn down later next year.
My advice for Sellers is to make your home as attractive in price, marketing, and appearance to get the sale that you want in 2012. My advice for Buyers is to shop around and look for those gems that are out there with motivated Sellers that will negotiate for a fair price. It is an awesome time right now to get into Real Estate ownership, particularly if you are a first time home buyer.