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May Home Sales Volumes in Sharp Contrast to Recent Years

Monday, Jun 11, 2018

KELOWNA, B.C. – June 5, 2018. The volume of May home sales across the region of Revelstoke to

Peachland contrasted sharply with this time last year, with 817 homes sold, a slight uptick from April but

down 28% over this time last year, reports the Okanagan Mainline Real Estate Board (OMREB).


“Not surprisingly, the residential home market continues to slow after a particularly heady market that

peaked in 2016. Supply is starting to catch up with new units coming on stream, while demand is

dampening as a result of government regulations,” said OMREB President Marv Beer noting that May is

the third consecutive month where sales volumes were down from the same period last year.


New listings were 1764, up 16% over April and 7% over this time last year. Average price, typically the

last indicator to normalize, was $532,972, just 1% over April and 4% over this time last year.


“Market peaks and valleys could be significantly softened if government were to address the root cause

of BC’s continued chronic shortage of affordable housing,” Beer contends.


“When demand for housing increases, home builders typically respond by building new homes,” Beer

notes. “But, as we’ve seen here and across BC in general, prices increase when supply doesn’t ramp up

fast enough, making homes less affordable in general.”


Adequate housing supply is critical for long-term generalized housing affordability. Rather than targeting

specific groups, government could make a lasting, more significant impact on housing affordability by

addressing the regulatory hurdles that constrain housing supply in general. This, in turn, would impact a

much larger population of renters and buyers who would not qualify for social housing. In fact, a new

UBC study concerning Metro Vancouver provides evidence that the focus governments have placed on

demand-side policies are unlikely to lead to housing affordability. The concepts are applicable



Current regulatory barriers, or ‘red tape’ coupled with an uncertain regulatory environment, aggravates

supply of housing now and likely critically affects overall affordability in future.


“The problem with trying to curb demand is that it is unlikely to free up the kind of housing people want

and need, plus it’s risky, with the potential for broad-reaching economic and development implications,”

says Beer. According to Beer, the situation is made even more worrisome when federal and provincial

governments are both tinkering in the market independent of each other.


“As governments continue to tinker, rather than deal with the root cause of BC’s real estate market

woes, they are very likely to harm the very people they aim to protect and support,” concludes Beer.