BCREA Housing Market Update for November 2023

BC Real Estate Association (BCREA) Chief Economist Brendon Ogmundson discusses the October 2023 statistics in the most recent Housing Market Update.

Home sales in BC have continued to slow as the markets adjust to the jump in mortgage rates. The rates at this time are at their highest level since 2007. Sales for October 2023 were about 15% below normal for that time of year. Sales were 1.8% higher than October 2022, however October 2022 was a slow month for sales. The sales were down nearly 10% on a monthly basis from September 2023. The number of active listings are also up about 12% year over year and up 5% from September. Due to the increasing inventory and slower sales, that is contributing to a larger inventory accumulated. For the long term, active listings are about 50% below where they need to be for a long term balanced market. Presently we are looking at a balanced market but it is skewing closer to a buyer’s market in BC. The average price for BC homes sold in August was $958,000. That is up 4.1% year over year but flat since September 2023. Year to date the averge home price in BC is down 3.4% compared to 2022.

In Kamloops there were 184 units sales in October 2023, this reflects a 9.5% increase year over year. The average price saw 4.1% growth to $616,934. There were 1.065 active listings which is a 13.7% change which equates to 5.8 months of supply. The Kamloops market is definitely slower to absorb the number of listings on the market. There are still active sectors that see a lot of activity however the higher priced homes are much slower to sell.

For the complete news release, including detailed statistics, click here.

Click here to visit to BCREA’s website. To view other statistics for the Kamloops and BC real estate market click here.

If you want to be kept informed on Kamloops Real Estate, News and more visit our Facebook Page.

To search for Kamloops real estate and homes for sale click here.

“Copyright British Columbia Real Estate Association. Reprinted with permission.” BCREA makes no guarantees as to the accuracy or completeness of this information.

BCREA Housing Market Update for January 2023

BC Real Estate Association (BCREA) Chief Economist Brendon Ogmundson discusses the January 2023 statistics.

The BC real estate market is off to a slow start for 2023. Sales in the province are down 50.3% yaer over year. January is typically is a slower month for sales, the sales volume for this January is the lowest since January 2009. The invetory is up from January of 2022 however the inventory of home sales is still below the normal number for the month of January. Presently with the sales activity levels it puts the market in more of a balanced territory however it is close to dipping into the buyer’s market range.

The average price provincially was down 16.5% year over year. The sales have shifted away from the more expensive housing to more affordable home sales. Sales of single family detached homes in the lower mainland have dropped quite a bit.

The MLS Composite Price Index shows a 5.9% decline in the Interior region. In comparison Vancouver saw a 6.6% decline, Fraser Valley 15.1%, Victoria 1.3%, Vancouver Island 3.7% and 21.9% in Chilliwack.

Kamloops saw 115 unit sales for January 2023. That is a 38.8% decline year over year. The average price is a $552,976 which is a 12.3% adjustment. Kamloops presently has 752 active listings at the end of January which is 107.2% increase from last January and that equates to 6.5 months worth of supply. Kamloops actually has a lower ‘month of supply’ than other regions with the Okanagan at 9.4 months, South Peace River at 10 months, Kootenay 7.5 months, BC Northern 9.9 months, Greater Vancouver 7.6 months. The only two regions that have a lower month’s worth of supply is the Fraser Valley and Victoria.

There are buyers out looking for homes in Kamloops, we have found that there aren’t a ton of options for buyers in some price segments. It will be interesting to see how the 2023 real estate market pans out for the region. Kamloops seems to be a bit of a unique city where there are a lot of relocations for jobs and the city continues to grow.

Click here to visit to BCREA’s website. To view other statistics for the Kamloops and BC real estate market click here.

If you want to be kept informed on Kamloops Real Estate, News and more visit our Facebook Page.

To search for Kamloops real estate and homes for sale click here.

“Copyright British Columbia Real Estate Association. Reprinted with permission.” BCREA makes no guarantees as to the accuracy or completeness of this information.

Canada’s Ban on Foreign Home Buyers Coming in January 2023

On January 1st, 2023 the Canadian Government is implementing a ban on foreign home buyers. Canadian citizens and permanent residents are exempt from the ban while other buyers have different rules based on their situation.

International students and foreign workers are permitted to purchase a property in Canada but they have restrictions they have to satisfy before being able to purchase. They are only permitted to purchase one property. For foreign workers they must have worked in Canada for three of the four years before buying a property. Students are required to be in Canada for 244 days each year for five years before buying and are not permitted to purchase anything over $500,000.

The intention of these restictions to to establish that the international students or foreign workers have an intention to become a permanent resident.

The non-citizens who can purchase a property in Canada without further restricions are: refugees, diplomats, foreign nationals with temporary resident status, consular staff and members of international organizintions living in Canada.

Non-Canadian entities and foreign controlled Canadian entities will be banned from buying property in Canada. This includes a non-Canadian who has a three per cent direct or indirect ownership interest in an entity or corporation.

The ban also doesn’t include properties in less populated areas and often this includes areas where recreational properties exist. The Kamloops area is subject to this legislation however a lot of the outlying areas are not included, such as the Shuswap Lakes region, North Thompson, South Okanagan (including Penticton & Kootenays). Here is a map showing the Census map showing the exempt areas.

These rules are also developed to target residential properties with three or less units. So any properties with four or more living quarters are not part of the exemption for foreign purchases. Properties that are part of the ban are detached homes that contain a private kitchen facility, private bath and private living area and a part of a building that is intended to be owned and used as a place of residence. This includes semi-detached homes, townhouses, condos and row houses.

The ban may not do much to calm prices in Canada, we saw such a huge influx of buyers into the market due to low interest rates and a low supply of homes to purchase. The number of foreign buyers in BC specifically is quite low. In 2020 the number of residential properties where one or more owners were a non-resident was 4.7%. In 2021 that dropped to 1.1%.

The ban on foreign buyers is for two years. If any person or entity that knowingly assists a non-Canadian in the purchase of a property they can be fined up to $10,000 and the property may be forced to be sold.

Investing in Kamloops Rental Properties

Kamloops is a great place to invest in real estate. Low vacancy rates and lower home prices than other markets like Kelowna, Victoria, and the Greater Vancouver area make Kamloops an attractive choice for investors looking to purchase a rental property.

The Canada Mortgage Housing Corporation’s 2021 rental market survey put the vacancy rate in Kamloops at 0.9. With a steadily growing city and university the rental market will likely remain strong in Kamloops.

But what kind of rental properties exist for investors? Let’s break it down.

Homes with Legal Suites

Homes with legal secondary suites are relatively few and far between compared to those with non-conforming suites in the City of Kamloops but more and more are being built this way. A legal suite means that it was constructed inline with BC Building Code requirements under a building permit and has been inspected and received an occupancy permit. The greatest concentrations of homes with legal suites are in newer homes in the Juniper West, Aberdeen, and Sun Rivers neighbourhoods. There are also others sprinkled throughout the city. The City of Kamloops maintains a registry of legal suites which can be viewed online.

Homes with Non-Conforming Suites

Non-confirming (or in-law) suites are by far the most common type of secondary suite in Kamloops. Most of the homes listed for sale as having a suite are not legal suites but are instead non-conforming. They are commonly referred to as a ‘basement’ or ‘in-law’ suite. This means they were not constructed under permit and may not even be in a neighbourhood which is zoned for secondary suites. Even if a suite is built in an area where the zoning permits secondary suites it does mean that the suite is legal. Many investors purchase homes with non-conforming secondary suites as rental properties. This does come with increased risk as compared to those homes with legal suites. As not constructed under permit, the City of Kamloops could enforce compliance or removal of the secondary suite if a complaint was received regarding the unauthorized accommodation.

Full Duplex

Full duplexes can be found throughout the city with the majority of those being in the North Kamloops, Westsyde, and Brocklehurst areas. These are excellent investments which feature two independent side by side units. These units are popular with renters as noise transfer can be less than usually occurs between upper and lower floors in many non-conforming suites. A full duplex can also feature separate side by side yards meaning a possible higher rental income due to the outdoor space available to a tenant.

Three-plex and Fourplex

A three-plex and fourplex is a building that features three and four separate residential suites. These are most often found in the areas of Downtown (South Kamloops), Westsyde, North Kamloops, and Brocklehurst. A legal three or fourplex is a rare find in Kamloops. More often they are non-conforming meaning they are a duplex which has been converted to add a secondary suite on one or each side of the building creating three or four separate residential suites.

What about Short-Term Rentals in Kamloops?

Short term rentals are largely unregulated in the City of Kamloops. With lower tourism numbers and lower numbers of short-term rental units than other jurisdictions in BC, short term rentals haven’t been a problem in the city. Because of this, the city of Kamloops has not created tighter regulations. Many strata complexes within Kamloops adopted bans on short term rentals within their own bylaws. In other strata developments short-term rentals haven’t been addressed simply because they have yet to be a problem. However future bylaw changes could be put in place to restrict short-term rentals if approved by the strata. If you are looking to invest in a property with the intention of renting it on a short term basis, a freehold single family home is your safest bet.

Outside of the City of Kamloops in the Thompson Nicola Regional District short term rentals are highly controlled and require a temporary use permit

Sun Peaks also tightly controls short term rentals and has its own set of rules. Here short term rentals are only allowed if the property is zoned for tourist accommodation (R1-A or RS-1A) or if the owners have a temporary use permit. Owners must also have a business license from the Sun Peaks Resort Municipality. Recent changes to the rules around short term rentals are detailed by Sun Peaks Independent News here.

New Government Legislation Removes Rental Restrictions

The BC Government recently announced that all strata rental restrictions other than short term rental restrictions have been removed. This means that buildings which previously banned or limited the number of units which could be rented will now allow rentals. In Kamloops this opens even more possibilities for investors to purchase potential rental properties. Of note, numerous strata complexes near Thompson Rivers University which previously banned or limited rentals will now allow rentals creating new opportunities for investment near the university.

So, if you are thinking of investing in a rental property there is no time like the present and our city is a great place to do so.  Contact Us to find out more about buying a rental property in beautiful Kamloops, BC.  

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To find Kamloops townhomes for sale click here.

Search for Kamloops condos for sale click here.

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