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Business in Brief: Real Estate Sales Dip, Prices Jump

Penticton Western News, July 5, 2008

Reports this week have finally started calling it a buyers market, as the trend indicates B.C. is entering a cooling off period.

But while the sales numbers are down, the total sales values are still increasing for some regions, according to Landcor Data Corporation.

The Okanagan is one of three regions in B.C. — Greater Vancouver and the Kootenays are the other two areas — that experienced this total sales value increase in the first quarter of the year compared to the first quarter of 2007 despite the drop in the number of properties being sold.

This year Penticton had the third lowest number of first quarter property sales in the past five years totalling 4,166 sales. However, these sales amounted to $1.425 billion, exceeding last year’s first quarter by nearly 10 per cent. The largest share of properties sold in the Okanagan in the first quarter of the year were single detached homes, making up 40 per cent of property sales but 50 per cent of the total sales value.

Areas that have seen a decline in the total sales value and property sales include Vancouver Island, the Fraser Valley and the north.

One of the reasons for the drop in total property purchases across the province is a reduction in the number of buyers from outside B.C., including Alberta and the U.S.

According to Landcor the downturn in the market is not an anomaly, but simply a natural market correction following years of record high sales. Last year while the market dropped for a second year in a row with 158,000 sales in B.C., the value broke another record at $62 billion.

With the first quarter accounting for about 19 per cent of annual sales, Landcor predicts 2008 will see a more than 140,000 sales — 2004 levels — valued at $61 billion, or about 2007 total sales value.