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The world according to Bill
One of my sales people sent me an article that stated that the Okanagan is headed for a “sizable crash.”
Another statement in the article said “a recession will send the region’s housing market into a free-fall.” I cannot believe how people so often miss the boat on how the real estate market works. The biggest mistake they make is the fact that real estate is incredibly local.
To make a blanket statement about any large area illustrates a lack of understanding of the mechanics of real estate. Our area is a great example. The North Okanagan and the Shuswap are in a rising market and the Central Okanagan is starting to soften slightly.
These are two markets an hour apart and are travelling in different directions. There is nothing in the statistics that predicts a crash. There are roughly 20 points we use to predict the market and almost all of them are positive for our area.
I have no idea, knowing what I know about the real estate industry and how it changes, why anyone—expert or not—would talk about or discuss Canadian real estate or even provincial real estate. There are as many different independent markets in Canada as there are municipalities. I think people make this mistake because the stock market is incredibly global and not local and they fail to understand the differences in the two markets.
The North Okanagan and the Shuswap will continue to grow in 2018 to the tune of about four to six per cent. That rate of growth is down from 2017 and 2016, but it will still grow. The Central Okanagan sales will flatten out, but prices will continue to creep up slightly—albeit slower—than this year or last.
The reason I am so arrogant in the way I look at this is that every year I predict what is going happen in the next year using the graphic and statistical calculations that I have been using every year for the last 20 years. I always go back and check to see how close I was. Every year, my predictions have been very close to the reality.
Many times, when I make predictions like this year, people accuse me of being overly optimistic to benefit our business; however, when I am pessimistic they accuse me of being overly negative. In 2006, I could see the inventory rising and the absorption falling and predicted the crash and people accused me of being overly pessimistic.
People make crazy statements for specific markets based on national statistics and the news that are totally inaccurate.
The Feb 18, 2013, issue of Canadian Business magazine—a reputable magazine—predicted real estate prices in Canada would plummet 20 per cent and stay down for years. What has actually happened since 2013? Prices in most individual marketplaces across Canada have risen and total Canadian real estate stats have risen dramatically as well.
This article was as wrong as it could possibly could be. How does that happen? The main reason is that the only thing that sells magazines better than bad news is really bad news. When the market shows a fairly gradual or slow rise or fall, it just isn’t newsworthy.
It also does not give awe-inspiring data for a good speech. However, that is exactly what we are going to see in the Okanagan Shuswap real estate market in 2018: a slight rise in the market with a dramatic nothing.
However, that’s just the world according to Bill.
Have an awesome holiday, everyone.
Bill Hubbard is a real estate broker and the owner and broker of a four-office real estate firm in the Okanagan-Shuswap. He has been in real estate for 28 years and has been an owner and broker in Vernon for 20 years. At almost 60 years old he is just as passionate about real estate as the day he started.
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