House prices in Kelowna are expected to climb by                                                 Return to web site
another 10 per cent next year.

Reporter Kelly Hayes   Kelowna BC

More Record House Prices

House prices in Kelowna are expected to continue to climb through the roof next year.

According to a report released by RE/MAX, house prices across Canada are expected see a slight increase in 2006 with the exception of Vancouver, Calgary and Kelowna where house prices are expected to climb by 10 per cent.

The average price for a home in Kelowna this year is $258,600. Next year, the price is forecasted to be $284,000. That includes all types of housing. The average price in Canada next year will be $246,000.

And the real estate picture gets brighter when you look at the numbers released by the Okanagan Mainline Real Estate Board. The average selling price for a single family dwelling in the Central Okanagan during October was $338,550. Last October, the average selling price was $290,405.

RE/MAX's Cliff Shillington says house prices in the Okanagan continue to climb for one simple reason -- lifestyle.

"Kelowna, as we all know, is a great place to live. We're a lifestyle destination and everyone wants to live here. We've also been discovered by not only parts of Canada, but also the rest of the world."

Kelowna and area housing starts actually dropped last month. According to CMHC, October housing starts fell to 159 units from 229 units in September. But the experts say the demand for housing in Kelowna continues to remain strong.

“Kelowna's new home market continues to see very high levels of construction activity, despite October's decline,” says CHMC's Paul Fabri. “Homebuilders are working flat out to meet demand,”

RE/MAX's Cliff Shillington agrees, but he says finding the labour to build those new homes could be a problem.

"Probably one of the biggest challenges we're going to face in 2006 in the Okanagan is finding the labour to finish the product for us."

Shillington says affording a new home is also a hurdle.

"Another challenge we're seeing is affordability for a first home. Fortunately though, first time home buyers don't have to spend $300,000 to get into their first home. Now were seeing first time buyers looking at condos and townhouses as their first property."

Predictions are that interest rates are going to going up soon. Shillington says that might motivate the fence sitters to enter the real estate market.

"Whenever we see interest rates going up, we usually see that continue to happen on a consistent basis. So, anyone sitting on the fence wondering if they want to upgrade or enter into the market for the first time will have to make that decision. If there's an expectation that rates could continue to increase, then yes you better get into the market now."
http://www.omreb.com