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The Penticton real estate market is in the midst of a “correction" following two record-breaking years, according to new statistics from the South Okanagan Real Estate Board.
A total of $353M in residential real estate has changed hands as of Nov. 1, down 17 per cent from $428M this time last year. The total number of transactions has also slowed to 822, so far, down 22 per cent from 1,059 last year.
“People are being a little bit more realistic, buyers are being a little bit more conservative — especially with the limitations of their purchasing power as result of the stress test that was put forth this year and interest rates slowly increasing,” said SOREB president Dori Lionello.
Despite the slowdown, prices have continued to climb with the average home or condo selling for $429,000 this year, driven by the higher-end market, according to Lionello. That high-end market has not been impacted as much by interest rates or the stress-test changes.
Penticton real estate has also been hamstrung by the cooling of the white-hot Vancouver market.
“I’ve had people that have bought here and expected a really quick sale in Vancouver, and that hasn’t happened,” Lionello said. “Vancouver homeowners are used to listing their homes and then setting a date to look at offers. Now they are listing their homes and a month has gone by and they are taking another look at their price.”
While the numbers are down when compared to the previous record-breaking years, Lionello said things are still very active in the $300,000 to $575,000 price range. Homes that are priced reasonably are still selling.
“A little less of the speculation and trying to get over-market value. That’s really slowed down, people are being more realistic,” she said. “The realtors are not necessarily trying for that extra four per cent.”
“We are still busy, the numbers are just coming down to reality,” she said.
The South Okanagan market, as a whole, is following very similar trends as Penticton with a 17 per cent decrease in total dollars sold when compared to last year.
