As of this month, Kelowna remains one of Canada’s most profitable and prosperous real estate markets, trailing only behind the Greater Vancouver area. But, with the Bank of Canada reducing its overnight mortgage rate to 3.75% on October 23rd and new construction showing no signs of slowing down, there is plenty of potential for buyers looking to enter the Kelowna real estate market as the end of 2024 draws near.

With housing inventory holding steady this year (for example, in July the Central Okanagan reported 3,424 active listings, including the highest inventory of condos, single-family homes and townhouses our area has seen in the past decade) this winter might be the perfect time to get into the market before it becomes more competitive due to the decreasing interest rates.

If you’re curious about how the Bank of Canada’s overnight mortgage rate changes have historically impacted the housing market, be sure to read the detailed overview in my blog post from last month. The long and the short of it – the lower the rates, the more competitive the market tends to become, which decreases available housing inventory and drives up average prices. Market experts are already estimating that median housing prices across the country could rise anywhere from 5% to 10% by the end of the year. In other words, if there were ever a prime time to buy a home in Kelowna this year, it’s likely right now.

The other major factor that will affect our Okanagan and Kelowna housing markets is the introduction of a doubled speculation tax rate in British Columbia – rising from 0.5% to 1% for Canadian citizens and permanent residents, and from 1.5% to 3% for non-Canadians. The BC government claims that most British Columbians will be exempt from this tax, noting that the intention is for owners to be encouraged to rent out their properties so that they’re eligible for exemption.

Coming off the heels of the short-term rental restrictions introduced in BC earlier this year, the provincial government is clearly making efforts to stimulate the long-term rental market alongside the Bank of Canada’s attempts to stimulate the housing economy at large. Of course, some property owners will see themselves in a position where they may have to exit the market based on the changes we’ve seen this year – however, with more options available to long-term tenants and buyers alike, we can look forward to seeing our local community and economy continue to grow and flourish.