Kelowna Real Estate Market in One Image: Interest Rates & Home Prices
This week, following another Bank of Canada interest rate cut, the graph tells a clear story—a strong correlation between Kelowna’s single-family home prices and the Bank of Canada’s overnight lending rate.
As we move into Spring 2025, interest rates have been on the decline since late 2024, and buyer confidence is returning to the Kelowna real estate market.
However, sellers and developers should watch the ongoing tariff discussions between Canada and the U.S., which could drive up construction costs despite lower interest rates. This is particularly important for Kelowna home builders and developers focusing on infill multifamily projects, as higher material costs could impact profit margins.
Kelowna Home Prices & Interest Rates: What to Expect?
Looking at the graph, we’ve seen what lower interest rates did in 2020, sparking a rapid home price surge as rates fell to 0.25%. While today’s market is different, I’m not predicting another 2020-2022-style boom, but early indicators suggest that with rates potentially dropping to 2% by July 2025, we could see Kelowna home prices rise again—if the economy holds steady.
- Current Kelowna Single-Family Home Price (Feb 2025): $1,190,000
- Developers & Builders: Expect potential price increases on materials but growing demand for multifamily housing and infill projects
- Home Buyers: Consider purchasing before rates drop further and more buyers enter the market
- Home Sellers: Demand may increase as affordability improves
There are no guarantees, and uncertainty remains in the Kelowna real estate market. However, if you’re buying and selling within the same market, your risk remains balanced.
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Mark and Maddie Coons
Selling Kelowna Real Estate Group
Tel: 778-744-0872
