Condo vs Home in the Okanagan - What is the better investment in your future

Dated: March 18 2020

Views: 290

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So lots of interesting stuff going on with brand new condo buildings right now in the Okanagan, specifically Kelowna. We are seeing a lot of new developments and when I say a lot, I live right downtown and within one block radius, there's five new projects that are happening around me. So lots of stuff going on. It's downtown, it makes sense. However, my concern is that all of these are kind of starting at the same time and being built at the same time and they're all going to come to market and being completed at the same time. So they're doing a lot of presales, which is great. But what I'm really seeing in condos is the prices are crazy. Yes, you can buy a new condo for $300,000 to 400,000.

However anything with a decent amount of space, and when I mean decent, I mean, you're lucky if you're getting a thousand square feet, is crazy prices that are $600,000 to $800,000 for a condo, which I think is pretty crazy because the average single family home in Kelowna is around $660,000. So you can get a full house, not the one that's completely falling apart, a nice family home with way more square footage, driveway, garage, all that kind of good stuff for the price that you're paying for a condo. So just something to be aware of and food for thought. 

If you are really dead set on a condo, I recommend looking at one that has really good bones, maybe a concrete building that's a few years old. It might not be to your taste, but you're getting more bang for your buck in terms of square footage. You can't really change the layout. So make sure that it's working for you. But maybe spend some money on renovation. Talk to your mortgage broker about purchase plus improvements and see how that might help you out. So that means that you purchase and the banks are going to loan you that extra money that you need that you might not have cash on hand to do improvements to your property and make that beautiful, amazing kitchen that you want. Why not have something that is a perfectly you, as in your beautiful brand new kitchen and your beautiful bathroom. 

I'm steering most of my clients towards having that thought in mind if they're getting really excited about new builds. If it works for you and that's super important to you and you want that beautiful lake view, then by all means. If it works for you, let's sit down and talk about it. But I'm watching the North end be redeveloped around the closing Mill. 

You can buy a house that needs renovations for $600,000. There was a really cool house that came up on the market. They was going through renovation and appeared like they didn't have the money to finish it. So it came on the market for about $500,000 and it was a complete renovation but also an addition. So yes, there was a significant amount of capital that went out, but they renovated it. It was beautiful. Had a pool, right downtown and sold for close to a million dollars in six months. So I'm not saying that house flipping makes an extraordinary amount of money and that should be something you think about. But again, if you buy something in the North end for $600,000, your block will be from the beach, put some money into it, renovate. Even if you put $200,000, you're still getting ahead financially more so than what you would by buying a brand new condo.

When the market was down, you couldn't give away a condo, but houses were still selling well. So again, me as a REALTOR®, I always give advice about what is the big picture in your longterm plan and how can we make that work for you. I never want you to be in a situation where you have to sell and you can't, and you have to take a hit financially. So there's a lot better future planning options. If you're wanting to look at that, then definitely have a talk with me. If you're deciding between, if a condo is right for you, how much you're going to spend, what does that look like? Would a townhouse be better? Would a single family home be better?

And especially looking at that longterm investment portfolio, what's going to net you the most gain when the market fluctuates? And of course, we always want to know when we're making the most amount of money on our house. In the past few years, we saw the average single family home go up $200,000. Condos didn't go up that much, but the average single family home did. So that's the best indicator of value and where to put your money. 

Kind Regards, 

Tiffany Munsey

A Licensed REALTOR®

778.214.4843

eXp Realty

tiffany@tiffanymunsey.com

tiffanymunsey.com

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Tiffany Munsey

Born and raised in the Okanagan, Tiffany Munsey an Award Winning Realtor in the Okanagan offers you first hand knowledge of the entire Okanagan Valley from being born and raised on a rural farm outsid....

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