Home sales in the Okanagan are expected to slow in the next two years, but don’t expect prices to fall.
The B.C. Real Estate Association said in a forecast this week sharply higher mortgage rates will slow activity across B.C. through to 2023.
“After a strong first quarter, BC markets are now adjusting to a much different interest rate environment,” said BCREA Chief Economist Brendon Ogmundson.
“With mortgage rates surpassing four per cent for the first time in over a decade, the housing market over the next two years may have very little resemblance to the housing market of the past year.”
It’s expected in the Okanagan unit sales will fall 19 per cent this year to 11,500. That’s down from 14,202 in 2021, which was a 55.1 per cent increase from the year prior.
The average residential MLS price in the Okanagan is expected to reach $849,000 this year, a 21 per cent increase from 2021’s average of $701,416.
It won’t be until 2023 when prices will plateau, with the forecast expecting an average list price in the Okanagan of $863,000.
The Okanagan’s forecast is much like the provincial trend, which expects unit sales to decline 22 per cent from a record high 2021 to 97,240 units this year. In 2023, MLS residential sales are forecast to fall an additional 12.4 per cent to 85,150 units, the forecast states.
The BCREA says it has started to see active listings move off of record lows and re-sale inventories trend back toward balance.
“However, because inventories reached such low levels over the past year, the journey back to balance may take up to a year or more in some areas,” the BCREA said. “As markets adjust to the new interest rate landscape, we anticipate that prices may be somewhat volatile but will ultimately flatten out through 2023.”