A few weeks ago, Kristian and Sarah Dart went to look at a house for sale on First Street. It was a private listing that was advertised online as a “tiny home” with a garage for just under $200,000.
They went to see it as quickly as possible, but they were too late. “They had three offers within the first 24 hours it was up on the Stoke List,” Sarah told me.
It wasn’t the first time that happened to them. The first house they wanted to look at, which they described as an old character home on Fifth Street, sold a day after they inquired about it.
Those kinds of stories are becoming more and more common as Revelstoke’s housing market has heated up over the past year. Multiple offers being made on some houses, some are sold within days of being listed, and anything below $300,000 is going quickly, no matter kind of shape it’s in.
“It’s very competitive,” said Don Teuton, the managing broker for Royal Lepage Revelstoke. “If the house is priced right and you’re a buyer, you have to move quick.”
There were 120 homes sold in Revelstoke last year, and 49 so far this year as of early June. More than 70 per cent of them went for $200,000 to $400,000. The average sale price of single family homes has climbed to $364,498 so far this year from $331,109 in 2013 — a 10 per cent increase.
(Note: In Vancouver, home prices went up about 80 per cent in that time period)
There were only 42 single family homes on the market when I spoke to Teuton. There’s no shortage of potential buyers, especially in the price range that’s considered affordable for many people.
“I don’t think we’ll have the same pace as last year, but I believe it’s more due to the lack of inventory than interest,” said Teuton.
“The interest is there. People love Revelstoke. A lot of first time home buyers are people that have been in the community for three, four five years and are getting into the market.”
The surge is due to multiple factors. For one, prices have come significantly after they sky-rocketed in the years surrounding the initial development of Revelstoke Mountain Resort. Prices tripled during that time and have since come back to earth, though they’re still much higher than the pre-resort days and are rising again.
As well, mortgage rates have dropped, with the Bank of Canada lowering its key interest rate to 0.5 per cent last July. Add in high building costs and surging prices in the Lower Mainland, and the conditions are there for the surge.
“I think the critical piece you’re seeing is rents rising, while mortgage rates have stayed low,” said Dean Strachan, the City of Revelstoke’s manager of development services. “Now people are in the position where they’re paying more in rent than they would pay in mortgage to buy a house. The problem is they can’t buy a house in their dollar value.”
Many of the buyers are young people who moved to town fairly recently, though there are others from out of town. They’ve managed to establish themselves in town and decided to take the plunge.
“I think the general attitude in Revelstoke is a positive one and people have a certain degree of confidence. There’s a lot of people that have been here a few years and they’re reaching that stage,” said lawyer Chris Johnston, who’s office handles many real estate transactions. “Those people are the ones that are driving the real estate market, what’s happening right now.”
Roberta Bobicki, the CEO of the Revelstoke Credit Union, said they have about 20 people pre-approved for mortgages of up to $400,000.
“We’re willing to do the financing, but people are having trouble finding something to purchase in that price range,” she said.
I didn’t have to look hard to find people shopping for homes these days. Sarah Dart works at the Review, and my roommates are also looking to buy. Kai Palkeinen and Kelly Hutcheson have been house hunting seriously for about the past six months. The couple opened up Pulse Bootfitting last fall and are now looking to cement themselves here.
They held off on buying while they worked on opening their business, and now feel like they may have missed the time to buy.
“Last year everything was fairly reasonable, but we basically missed it by a year we realized,” said Hutcheson. “This year everything is about $80 grand more than it was last year, and things are going really fast.”
Palkeinen said the houses that are on the market now in their price range aren’t worth what people want because of the condition they’re in.
“I look at what’s on the market right now and the easiest way to describe it is you look at what’s on the market right now for $360K, it needs $40-60K of work, but then it’s never going to be worth all that,” he said. “The value of the house isn’t there.”
That has them looking at lots, like so many others. While home sales are down this year, lot sales have surged to 21 so far, compared to only 11 in all of 2015. There are more lots available for sale right now than homes.
“That’s where people are going because they can’t buy,” said Teuton. “That’s a reflection of our lack of inventory.”
Fourteen single family homes were built in Revelstoke last year, and at least another fourteen are being built this year. The homes are all owner-built; no one is building homes with the hopes of selling them later.
“What we’re hearing is the inventory is very low and the number of new builds that are spec homes are almost zero,” said Strachan. “Nobody’s building homes to sell, you have to build it yourself.”
Revelstoke isn’t unique in the Southern Interior these days. A recent article in the Nelson Star said very similar things about that community.
“The current market is very active,” Wayne Germaine, a Nelson Realtor told the Star. “There is a surplus of buyers and a lack of inventory.”
Johnston, who also has an office in Nakusp, said the market was heating up in that small community as well.
For Sarah & Kristian Dart, the process of house shopping has been an eye opener. They also see Revelstoke as being over-priced.
“For a small town I don’t think the prices equate to what’s actually here,” said Kristian.
They’re not skiers, so Revelstoke doesn’t have the same allure to them as it does to many others. Still, after having moved here about six months ago when Kristian was hired as assistant manager of the BC Liquor Store, they’re hoping to stay.
“We like it here more than we thought. If we buy a house, we’ll stick around for a while,” he said.
When asked if the housing situation would prevent them from staying, they said no.
Stay tuned for part two, which will look at the future of housing in Revelstoke.