Steve Higgins, a Realtor for ReMax in Kelowna, B.C., said the interest rate cut will do wonders for the economy in the province, bringing a new wave of immigrants to purchase properties and spur domestic investment from retirees and first-time homebuyers.
“People will have more buying power and be able to get a more competitive mortgage rate. The market has been fantastic over the last year and sales have gone up 25 per cent,” Higgins said in an interview with REP.
Higgins made the comments following the Bank of Canada’s decision to cut the interest rate. Since then, banks have speculated the effects to the Canadian housing market with a lower dollar and falling oil prices.
TD Bank released a report Monday citing that eight provinces would experience a decline in home prices and B.C. wasn’t one of them. The Bank predicts that house prices will rise 2.9 per cent in B.C. overall in 2015.
Year-end figures from the Okanagan Mainline Real Estate Board showed that home sales in Kelowna were stronger than they’ve been in the past seven years as 4,897 homes changed hands in 2014.
This comes after home sales were down to just 3,446 in 2008 during the height of the recession, according to Okanagan real estate stats. The average price for a home in 2009 was $455,504 and now in 2014, home prices average at approximately $500,000.
In what was a buyer’s market has now become somewhat balanced, but not everything is milk and honey; there could be some blood and tears on the horizon.
According to the Okanagan Real Estate Board, almost 20 per cent of home sales in the region are made up of Albertan buyers, some semi-retired looking to purchase a second property as an investment.
But with falling oil prices, there’s a lot of uncertainty as to their buying power going forward. That said, Higgins believes the market will retain its hot outlook for 2015.
“We do have a lot of people from Alberta buying houses here and I don’t expect that to change too much,” he said.
As the effects of the interest rate cut continues to be felt in the Canadian market and TD predicting yet another rate cut yesterday, some Realtors couldn’t be happier with the news.