The Best of the Okanagan Region

For capital gains, many might have wished they'd bought an Okanagan home a decade ago when prices were nearly half what they are now. But for investors and those who just love the area, there's still a great opportunity in the B.C. region.

The demand has certainly not let down. Students, golfers and skiers make up a near-perfect mix for property owners looking to rent out either part of the year or year-round.

In the past 10 years, both South Okanagan and Okanagan-Mainline rank in the top 15 for average home price gain, according to the Canadian Real Estate Association. Both have jumped nearly 150 per cent in that time, reaching $315,000 and $380,000 respectively.

But there's reason to hope for even more going forward. Businesses are relocating here, university enrolments are rising, and more people are still discovering the area.

"This is the place everyone wants to come," says Bert Chapman, owner of Premier Canadian Properties. "It's where a lot of Canada vacations, and as people age, they invest their money in places they liked."

He says the unique and beautiful surroundings will always make the area attractive to visitors.

"We're a desert with lakes," he says. "I don't know anywhere else in the world that you'd find that."

Kelowna

Kelowna, the largest Okanagan city, was recently ranked sixth among the top B.C. investment towns by the Real Estate Investment Network for its city leadership, which has worked to build infrastructure and develop growth.

"Businesses are relocating to Kelowna where they have lower start-up and operating costs compared to larger centres such as Vancouver and Calgary," says Kristy Huber, manager and broker at Coldwell Banker Jane Hoffman Group. Companies have little trouble selling Kelowna to their employees as a new place to live, she says. Skiing, boating and golfing allow residents to enjoy all four seasons outdoors.
Selling best right now in Kelowna are homes priced under $500,000. Anything above $1 million has been slow since the recession, but some agents in the area are reporting a slow return.

Homes on the water or offering lake views remain popular, especially Upper and Lower Mission and Lakeview Heights, Huber says. Condos continue to struggle with pricing as well, as it has been oversaturated with product.

Consumers in Kelowna thus tend to prefer single-family homes to condos, says Huber. That's also impacted rental returns, although she says seasonal waterfront rentals can still get good returns.

Chapman says buying near the UBC-Okanagan campus can also give good returns year-round. Enrolment has been rising since it started in 2005, and could reach about 7,000 full-time students soon.

Close by are the golf courses in Quail Ridge, just north of Kelowna and near the airport. There are two world-class golf courses there.

"Those properties are very popular," Chapman says. "You can rent your units to students all winter, then you can do short-term rentals in the summer to golfers. It's enough to stick money in your pocket after the year is over."

Short-term rentals also allow owners to stay during certain weeks or months of the year as well. These properties start from $275,000 to $325,000 and can bring an annual return of about seven per cent on the down payment, says Chapman.

Properties near skiing locations rent well in the winter, but risk long vacancies in the summer.

Vernon

About 50 km north up the lake, Vernon is another top Okanagan investment option. The city's slogan is "More than just wine, golf and ski." The area is certainly known for its numerous golf courses minutes away, including Predator Ridge Resort.

There's also Silver Star Ski Resort, and there are roughly 100 wineries through the valley. But Vernon is also a prominent year-round community, both to retirees and families.

Mountain bike trails, agri-tourism attractions, and many festivals and events make it a great place to live, says Priscilla Sookarow, owner of Priscilla & Company Re/Max Vernon. "You won't be bored," she says.

A diversified economy has helped Vernon stay strong even during the recession. There's already a lumber, agriculture and tourism industry, as well as Okanagan College. Plus the local brewery is expanding, there will be a new five-storey hospital expansion, and work on another office building is expected.

At the same time, the community is focused on remaining both family and environmentally friendly by preserving the walking trains and waterfront neighbourhood.

Home prices remain attractive, at about $365,000 compared to $460,000 in Kelowna, says Sookarow. The average home price rose 6.1 per cent over the same period last year in Vernon.

Market activity itself is near where it was before the 'big rush,' says Sookarow.

Especially homes priced $325,000 to $400,000 are attracting buyers. Adult condominiums have also been strong.

As with the region in general, higher priced luxury homes have had little demand, but Sookarow says she sees that picking up.

"Out-of-province buyers for lakeshore homes are beginning to visit now that the sun is here and right now, there is a good selection to choose from on both lakes with prices as low as $1.1 million," she says.

Choosing where to buy in Vernon really depends on your budget and interest.

"There is a neighbourhood for everyone," Sookarow says. "Buyers can choose their preferred area based on proximity to schools, college, lake or ski hill access, view, size of yard and age of home."

Penticton

About an hour's drive south of Kelowna is another community recently ranked among the top 11 B.C. investment options by the Real Estate Investment Network - Penticton.

MLS statistics show it was slightly cheaper than Vernon, with an average price of $323,000 this year.
"While Vernon is more of a year-round community, Penticton just bursts at the seams every summer and is very much a vacation land," says Chapman. "It's grown up beautifully as well, and there's some very nice product. If you want an apartment in a highrise or a nice condo, it's a good place to be."

Splitting the south end of Okanagan Lake and north end of Skaha Lake, Penticton's original Okanagan meaning was translated by the local tourism promoters as,

"A place to stay forever." That's become increasing true lately. While it was once known as a tourist town, a stabilized economy backed by manufacturing businesses moving in has changed that, says the REIN.

"Tourism and agriculture will continue to provide the economic base for the region," says the 2010 REIN report. "However, as more manufacturing companies bring jobs to this affordable region, we will witness a decrease average age and an increase in average income of its residents."

A strong population growth could spur increased rental demand and home purchases.

 

     
 
 
 
 
 
     
 
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