Kelowna area market dynamics

Sales of existing homes are forecast to move higher in 2011 and 2012.  Favourable interest rates combined with strong price competition will support modest growth in demand for existing homes this year. Kelowna's existing home market began 2011 on a slower note with inclement spring weather conditons contributing to fewer quarter sales than a year ago. Pent-up deamnd amoung first-time buyers, a key factor underllying the upswing in sales recorded in 2009 and earlier last year, was largely satisfied by mid 2010.  Despite expectations of slightly higher interest rates during the next two years, stronger employment growth will boost demand for existing homes in 2012.

Home buyers will continue to benefit from an ample supply of listings and strong price competition in th market in 2011. The supply of detached homes listed for sale has remained at high levels. Apartment condominium listings have come down from a year ago. The decline reflects reduced listing activity rather than an increase in sales. Kelowna's existing home market will move to a balanced market position in 2011 as demand improves and the supply of listings slowly comes down. Moderating demand in combination with abundant supply kept the Kelwona area existing home market in borderline buyer~balanced territory last year.

Existing home prices are forecast to edge up this year and next. An ample supply of listings in combination with modest growth in demand will temper upward pressure on prices. Detached home prices stablized in mid 2009 after trending down since the previous spring. The average detached home price moved higher in 2010, but much of the increase is attributed to shifts in the price distribution of sales (more sales of mid and higher priced homes in 2010 than in 2009) rather than ture price appreciation.

Demand has broadened to include more move-up home buyers this year. While sales in mid and higher priced homes has risen, the focus of demand amoung home buyers remains moderately priced homes. Single family homes (detached and semi-detached units) priced at less than $400,000 accounted for 35 and 40 precent of sales in 2010 and 2009, respectively, compared to only 24 percent in 2008. Home buyer preferences have remained essentially unchanged during the first quarter of 2011.

SOURCE: Housing Market Outlook for Kelowna, Spring 2011 -CMHC

MAY 2011 MLS STATISTICS

PROVIDED BY OKANAGAN MAINLINE REAL ESTATE BOARD (OMREB)

All May 2011 and year-to date- real estate activity was down compared to same month last year.

Greatest amount of single family May 2011 sale activity was in the $300,000 to $600,000 range not unlike 2010.