Hello,
Welcome to 2024!
We are optimistic about the upcoming year and excited to look forward to predictions for our market this year. Yet, to effectively map out the future, it's important to reflect on where we have been. In 2023 we witnessed a dynamic shift in the real estate sector, characterized by escalating interest rates and diminishing buyer confidence. This rapid transition from a sellers to a buyer's market was marked by a significant 34% surge in residential real estate inventory compared to 2022, while sales decreased by 15%. This combination of oversupply and reduced sales activity led to a modest price decrease of approximately 6.78%.
With 2023 now behind us, we are hopeful that 2024 will usher in a period of stability, transitioning towards a more balanced market. Current analysts suggest that interest rates will stabilize in the first half of the year, followed by a potential decrease in the latter half. This anticipated reduction in interest rates is likely to invigorate the market, potentially leading to a moderate price increase. According to the Canadian Mortgage and Housing Corporation (CMHC), a 5% price increase is projected nationwide, although variations are expected across different cities. Despite the current high supply levels, CMHC indicates a continued housing shortage across the country, emphasizing the need for an additional 3.5 million homes within the next six years to improve affordability. As the demand across Canada increases, many will choose to move to the Okanagan with our 4 season playground, international airport and large hospital.
For 2024, we predict:
- A gradual price increase towards the third or fourth quarter.
- A shift to a balanced market with lower inventory levels than in 2023.
- Overall, a robust and healthy market in the Okanagan.
January has started slower, as is typical, but we are encouraged by signs of escalating activity in major Canadian cities and optimistic we will see more demand come to the Okanagan.
If you have any questions, whether it's about your home's current value or setting up a search to monitor specific market segments, please don't hesitate to reach out. We are here to assist you.
Warm regards,
Shannon & Tamara
