House prices up, up, up in Kelowna

Kelowna's housing market is complex, to say the least.

First of all, there seems to be no ceiling for rapidly escalating home prices.

The new, all-time record-high benchmark selling price for a typical single-family home is $1.129 million, a townhouse $758,100 and a condominium $557,400.

Yet, sales are down, partly because there's a chronic shortage of homes for sale, which only increases the competition for homes on the market, further pushing prices skyward.

Interest rates and inflation are on the rise.

However, all that hasn't stopped some people buying homes at unprecedented and excessive prices.

See, we told you it was complicated.

At the same time, all along this ride of skyrocketing prices, more and more people have simply been priced out of the market.

That means a good chunk of individuals and couples with healthy incomes and families with low-to-middle incomes cannot afford to buy a house.

So, they live with extended family or rent, which is also high, and watch their dream of home ownership dissipate.

The other side of the coin, of course, is that people who have owned their own home for years are revelling in copious amounts of home equity.

They're rich.

And if they sell in this market, they'll get oodles of money that they can use to buy another place or downsize and pocket a big stash of cash.

"Without a drastic supply of housing coming onto market, the lack of inventory will continue to impact buyers and sellers in the coming months," said Association of Interior Realtors Kim Heizmann, who is also a realtor with Century 21 in Vernon.

That's right, what Kelowna needs is a massive building boom to construct more new homes of all kinds -- for sale and rental single-family homes, townhouses, condominiums and apartments.

Only then, might the housing market balance.

Only then, might and rents and prices will settle down to normal annual increases of 2 or 3%, not the 34% yearly jumps we're seeing now.

Association of Interior Realtors statistics for March show while sales of single-family homes in the Central Okanagan were down 27% year-over-year to 301 homes, the benchmark selling price of such homes catapulted 34% over the same period to $1.129 million.

That $1.1 million will get you a typical Kelowna home, a standard, 1,800-square-foot, three-bedroom, two-bathroom house in a nice neighbourhood.

There will likely be no backyard pool, no view and no fancy features, fixtures and finishings previously associated with a $1 million home.

It's hard to believe that just 10 years ago, the average selling price of a Kelowna house was $415,000.

For townhomes the figures are: sales of 83 in March, down 44%, but the benchmark selling price is up 29% to $758,100.

A decade ago it was $380,000.

March numbers for condos are: 201 sales, down 25%, with the benchmark selling price up 32% to $557,000.

Ten years ago it was $268,000.