Penticton Real Estate News | Oct. 2021

Penticton Real Estate News

Every so often our mortgage brokerage embraces the responsibility of sharing recent Penticton real estate news. After all, seeing as you’re in the market for a home in the Southern Okanagan Valley it’s most certainly of interest to you. What’s new as we enter the fourth fiscal quarter of 2021? Is there anything on deck that should incite you to take action on your mortgage pre-approval? Let’s review.

Recent Real Estate Updates Regarding Penticton and the Surrounding Area that New Buyers Need to Know About


High Demand is Limiting Supply (act now)

This is inevitable, seeing as Penticton and the BC Southern Interior is considered the best place in BC to get a mortgage. As of October 2021, the Association of Interior Realtors reports that demand for real estate in the region is reaching a fever pitch, and as a result buyers are facing lower inventory. Data shows that this will persist through 2022 while recent residential construction projects are more likely to reach completion in 2023 (although pre-sales are through the roof too).

Are you out of luck? Certainly not, as there are still highly-desirable detached homes and condos on the market – you just need to know where to look. That said, it spans beyond having access to a Realtor or agent who is “in the know”, as a mortgage broker is also exceedingly integral. How? Because we can help you afford a home that you did not know you could afford. This is made possible via the provision of access to lower unadvertised mortgage rates, first-time buyer incentive programs, and if needed, introduction to alternative private lenders. This may obliterate the perceived constraints from your earlier mortgage affordability calculations. In turn, you can now consider properties that you never before deemed possible.

Fixed Rates Rising (but it’s not a concern for current buyers)

Canadian Mortgage Trends reported on some movement from the big banks in regards to fixed rates. After more than a year of sustaining historical low levels, fixed mortgage rates rose slightly in the first week of October. The movement was the outcome of an increase in mortgage funding costs, which resulted from a recent 34 percent rise in bond yields. To recap, fixed mortgage rates are directly tied the Bank of Canada’s activity in the bond market.

How much of an increase have we seen? CIBC increased their 5-year fixed (high ratio) rate from 1.99% to 2.19%, and their standard 5-year fixed rate from 2.24% to 2.36%. TD moved theirs from 1.89% to 2.19%, and 1.99% to 2.29%, respectively. On RateHub, Scotia Bank is currently advertising 2.29% while BMO is featuring 2.31%. Please note that this is not a concern for current buyers. Before the world got turned upside down, investors were jumping all over 5-year fixed rates under 2.4%. Besides, how long could rates sit at the rock bottom? Economically such a thing is not sustainable. If advertised rates stayed under 2% there would indeed be hardly any inventory left.

It also important to note that the Bank of Canada recently announced that they would continue supporting the bond market and have committed to this strategy to keep fixed interest rates low. They have not wavered from this pledge, so don’t expect fixed rates to rise much further (or at all) for the remainder of 2021. Simply stated, fixed rates remain very favorable. However, we cannot guarantee that they will stay low in 2022. We encourage you to get pre-approved to lock in your rates today.

South Okanagan Home Prices Taking a Dip

While fixed rates increased a little, prices of homes in Penticton and the surrounding area fell into even more favorable territory to close out the most recent month. The Association of Interior Realtors reported that the average sale price of a single-family home dropped from $780,000 to $633,000 in September. This trend probably won’t stick for too long though, as the aforementioned short supply will likely bring values back up. Again, we do encourage you to capitalize on the opportunity that remains. 2022 will be a new year in many ways.

Ready to chat about your goals for homeownership? Contact Carloni Mortgage Brokers for a friendly and informative conversation.

Call 250.493.9111