it ’ s a common refrain: demand has waned
The Central Okanagan’s housing market recorded its sixth consecutive month of declining sales counts in November, as many would-be buyers have been kept on the sidelines in response to high interest rates. And with December typically representing the low water mark for monthly transactions in the year, a seventh straight month of sliding sales is likely.
buying taking place—with last month’s months-of-inventory (MOI) metric sitting at 11.0 (an MOI of less than 5 reflects conditions more favourable to sellers; 5-8 MOI reflects balanced conditions; and an MOI over 8 reflects a buyers’ market). With the finish line to 2023 in sight, expect a similar combination of still-high interest rates (what we call “macro-ality”) and the more typical seasonality to play out again in December. Indeed, sales, new listings, and inventory—which all normally experience a steep drop-off between November and December—will undoubtedly sag again this year to close out 2023, with sales and new listings diverging somewhat. This will support inventory at the margin—good news, especially, for anyone who’s on the look out for their first home.
Here at rennie intelligence, we track a number of metro housing markets in British Columbia, and there continues to be one consistent, if unsurprising, feature of each one: high interest rates are smothering buying activity. When coupled with typical seasonal undulations that, on their own, yield declining housing market activity towards the end of each year, the result is sales counts that have continued to decline into November and will also do so into December in Kelowna and beyond. There were just 202 MLS transactions in the Central Okanagan last month, which was a 14% decline from October and the sixth consecutive monthly drop. And while this may have been less than the typical October-to-November decrease (of 16%), last month’s sales were still 14% below those of November 2022 and 43% less than the past-decade average for the month.
On the new listings front, November’s total of 600 was down 15% from October—also less than the typical month-to-month decline of 25%. Despite the slowdown, new listings remained elevated compared to both one year ago (27% higher) and the past-decade November average (25% higher). The result of below-average sales activity and above-average new listings was inventory that was 23% higher than in November 2022 and 25% higher than the long-run average for the month. And while November’s 2,219 total listings were down by 4% between October and November, this compared to the more typical 11% contraction. These supply and demand dynamics led to a third consecutive month of conditions that favour buyers in November—indeed, this is somewhat ironic given the lack of actual
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