The real estate boom across the Okanagan has not felt a negative impact from the coronavirus impact on our national economy. (Contributed)

The real estate boom across the Okanagan has not felt a negative impact from the coronavirus impact on our national economy. (Contributed)

Okanagan real estate boom keeps escalating

Predictions of the current boom extending through the 2020 decade

The 2021 year is one the Kelowna real estate industry hopes will never end.

In dramatic and unexpected fashion, the Okanagan real estate boom has taken a wild upswing dating back to early last fall, despite the impact of COVID-19, a boom cycle some experts say could extend for the rest of the decade.

While those selling land and housing are cashing in, affordability has reached a crisis point.

“I think when we look back at 2021 in the real estate industry, we are going to say it was a good time, but maybe the party ended too fast,” said Scott Brown, CEO of Epic Real Estate Solutions/Fifth Avenue.

Brown was one of three guest speakers for the monthly luncheon Zoom forum hosted by the Okanagan branch of the Urban Development Institute.

Joining Brown were Marshall McAnerney, principal/co-founder of HM Commercial Group, and Courtney Deshayes, a licensed property manager with Associated Property Management.

Speaking to the residential sales market, Brown said condos, single-family detached, townhomes and high-rise housing categories have all seen sales escalate dating back to last September.

“We have had what I would call a hot winter in housing sales and that suggests the summer will double what we saw in 2020,” said Brown, noting unsold inventory has dropped 50 per cent compared to six months ago.

Brown suggested the pent-up buying demand across the Okanagan, spotlighted particularly in Kelowna, is driven by people moving to the valley instead of people moving around within a given community.

READ MORE: Okanagan real estate market heats up in January

He says the buyer market is drawn from across Canada, people making a lifestyle choice to live in the Okanagan made more feasible by the ability to work at home, setting off an in-country migration that is expected to be further buttressed by a new wave of immigration from outside Canada settling here.

“That exodus of people from the larger urban centres like Vancouver started several years ago, and we are seeing that reflected both in the Greater Victoria and Kelowna regions where the real estate market has exploded,” he said.

“In the Kelowna region, younger people coming here to work remotely or find new jobs, the 55-plus crowd still working but again seeing the potential to work remotely because of what COVID has imposed on us, and people retiring are still coming here.

“And when you think about whether you want to deal with a highway or a ferry, it puts Kelowna in an enviable position.”

Deshayes said of 10 recent rental agreements she oversaw, only one was a Kelowna person relocating, the rest coming from Vancouver, Toronto and Alberta.

Like residential home sales, where demand exceeds supply, Deshayes says she sees those same characteristics play out in the rental market – great news for investors but bad news for renters seeing rental rates spike and availability reduced.

“In some cases, we are not even advertising rental vacancies. Either by word of mouth or through friends, vacancies are filled quickly,” she said.

She said Central Kelowna statistics reveal rental rates for condos have jumped from $1,500 to $2,450; main upstairs of a house from $1,600 to $2,300; and basement suites $1,400 to $2,000 since 2018.

“It is very tough out there for tenants right now,” she admitted. “But there is more inventory coming on the market in the months ahead, so I feel good about that. It is a hot time for the market right now.”

Addressing the commercial/industrial side of the industry, McAnerney summed it up this way: “What a difference a year makes.”

Available land has become a hot commodity, entertaining multiple offers for development across the valley, attracting the interest of Lower Mainland and Alberta developers.

Commercial space leasing has also seen a surprising resurgence despite the economic impact of COVID, trending particularly in the food and beverage areas and some personal services.

“The leasing market is still on fire despite COVID, but the office leasing category has been the slowest to rebound,” McAnerney said.

“Larger corporations have shown a hesitancy to lock into long-term leasing deals. There is greater interest in leases under 10 years due to the uncertainty around design space for physical distancing.”

Brown believes the ‘canary in the coal mine’ scenarios which might alter the current market boom include a sudden rise in the mortgage default rate or the federal government using a regulatory hammer to curb an over-heated market as was done in 2016 in response to the rising mortgage debt ratio for homeowners.

On the rental side, Deshayes said the rental crunch driving up rental rates will continue to make it more difficult for affordable rental options.

“A lot of people will be left with the option of moving out of the city and go somewhere else cheaper…the housing crunch is what worries me,” she acknowledged.

CoronavirusReal estate

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

A health-care worker prepares a dose of the Pfizer-BioNTech COVID-19 vaccine at a COVID-19 vaccine clinic in Toronto on Thursday, January 7, 2021. THE CANADIAN PRESS/Nathan Denette
65 new cases of COVID-19 in Interior Health

Overall, B.C. is seeing a decrease in COVID-19 cases

RCMP are searching for Philip Toner, who is a ‘person of interest’ in the investigation of a suspicious death in Kootenay National Park last week. Photo courtesy BC RCMP.
RCMP identify ‘person of interest’ in Kootenay National Park suspicious death

Police are looking for Philip Toner, who was known to a woman found dead near Radium last week

The southern mountain caribou, an iconic species for the Splatsin First Nation, is threatened with extinction, much to the dismay of the First Nation. (Province of B.C. photo)
Splatsin First Nation concerned over dwindling caribou herd

Southern mountain caribou at risk of extinction, will struggle to recover without habitat protection and restoration action - report

FILE - In this April 19, 2021, file photo, Keidy Ventura, 17, receives her first dose of the Pfizer COVID-19 vaccine in West New York, N.J. States across the country are dramatically scaling back their COVID-19 vaccine orders as interest in the shots wanes, putting the goal of herd immunity further out of reach. (AP Photo/Seth Wenig, File)
5 more deaths, 131 new cases of COVID-19 in Interior Health over the weekend

Those 18-years and older in high-transmission neighbourhoods can register for the vaccine

Sisters Audrey Cunningham and Donna Erdman, join the Vernon Kalamalka Chorus singing in their cars, tuned into the radio, under the direction of Debbie Parmenter. (Jennifer Smith - Morning Star)
VIDEO: Okanagan choir steers around COVID with ‘carbershop’ twist

Singers find a unique way to practice during pandemic restrictions

Keith MacIntyre - BC Libertarian
Penticton’s Keith MacIntyre new leader of the B.C. Libertarian Party

The Penticton businessman was voted in by members of the party on May 8

RCMP are searching for Philip Toner, who is a 'person of interest' in the investigation of a suspicious death in Kootenay National Park last week. Photo courtesy BC RCMP.
Man sought in suspicious Kootenay death found in Lake Country

Philip Toner is a person of interest in the death of Brenda Ware

Vernon North Okanagan RCMP reported to 287 mental health calls between Jan. 1, 2021, and May 1. (Black Press files)
‘It’s not the police’s responsibility to deal with mental health calls’: Vernon RCMP

RCMP remind public to take care of mental health and well-being, while better solutions are sought

A Falkland man will present a 600+ signature petition to the Columbia Shuswap Regional District board Thursday, May 20, opposing dog control in Electoral Area D, which includes Falkland, Silver Creek, Salmon Valley and Ranchero/Deep Creek. (File photo)
600-plus sign Falkland man’s petition against dog control

Similar bylaw rejected by 200 public hearing attendees when topic came up 9 years ago

Thompson Rivers University campus is in Kamloops, B.C. (KTW file photo)
Thompson Rivers the 1st B.C. university to supply free menstrual products

The university will offer the products this September

Fraser Health is using ‘targeted’ vaccination clinics in high-risk areas of the Lower Mainland. (Fraser Health photo)
B.C.’s COVID-19 decrease continues, 515 new cases Tuesday

426 seriously ill people in hospital, up from 415 Monday

Vernon North Okanagan RCMP reported to 287 mental health calls between Jan. 1, 2021, and May 1. (Black Press files)
‘It’s not the police’s responsibility to deal with mental health calls’: Vernon RCMP

RCMP remind public to take care of mental health and well-being, while better solutions are sought

Notes of hope, encouragement and camaraderie were left on the message board inside the kitchen of TacoTime. (Aaron Hemens/Capital News)
Adiós, Taco Tuesday: Kelowna residents flock to TacoTime on restaurant’s final day

‘We don’t need another Starbucks. We need tacos on Tuesday, with extra hot sauce’

Most Read