Mortgage Rate Hike Dampening Residential Market Activity

 KELOWNA, B.C. – July 6th, 2022. Residential real estate sales for the month of June in the region are slowing after the recent mortgage rate interest hikes by the Bank of Canada reports the Association of Interior REALTORS® (the Association). A total of 1,466 residential unit sales were recorded across the Association region, marking a 30.3% decrease compared to the unusual number of units sold in June 2021. 

“It’s not unusual that mortgage rates are impacting market activity, specifically in the higher-priced markets,”
says the Association of Interior REALTORS® President Lyndi Cruickshank, adding “this is what typically happens when interest rates move upward. It makes buying a home more costly, making what a purchaser can afford more limited. We are seeing this effect, particularly in what is typically a higher-priced home type. 

However, this shift is creating a welcome opportunity for buyers to slow down in their decision making, which is a welcome relief for many.” New residential listings saw a promising 14.2% uptick within the region with 3,265 new listings recorded compared to the same period last year, with a 3.1% increase over last month’s 3,166. 

The overall active listings also saw a healthy upswing with 7,154 listings currently on market, an increase of 45.1% in year-overyear comparisons.
“Our inventory is gradually picking up and supply is growing.
This is benefitting both buyers and people looking to sell and move. As we don't expect any relief in terms of interest rates in the coming days, one will have to anticipate the market while pricing properties correctly,” notes Cruickshank. 

The benchmark price for homes in the Central Okanagan, North Okanagan, South Okanagan and Shuswap/Revelstoke regions saw another month of double-digit percentage increases in year-over-year comparisons across all home categories with the exception of townhomes in the Central Okanagan area. The benchmark price for townhomes in the South Okanagan saw the greatest increase across all areas and home categories with a 27.9% increase compared to June 2021, clocking in at $601,400. 

The average number of days to sell a home, always a good barometer to watch, increased from 41 days in May to 45 days in June. It’s important to note that the average of days on market is for the entire Okanagan region and that the indicator will vary depending on home type and sub-region. Contact us, your West Kelowna REALTOR®, to find out more about the real estate market and how they can help you achieve your real estate goals.