It's the exact opposite of what was supposed to happen.
Generally, when interest rates are cut, the housing market perks up.
Yet, in August interest rates did slip, yet the Kamloops housing market did not react positively.
In fact, it faltered in counterintuitive defiance.
The bottom line is interest rates have not come down fast enough or far enough to combat the overarching unaffordability that's plaguing local housing.
Thus, potential homebuyers continue to sit on the fence, hoping for relief that never really comes.
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"Demand doesn't seem to be translating into sales, despite recent interest rate cuts," said Kaytee Sharun, president of the 2,600-member Association of Interior Realtors.
"(It's an indication) that there could be various other factors impacting market activity or some sellers (and buyers) were merely holding out for the latest Bank of Canada rate cuts."
Home sales were trending upward at the end of July after a Bank of Canada interest rate reduction from 4.75% to 4.5%.
But, the momentum didn't continue into August.
In fact, sales of all types of homes slumped in Kamloops to 160 in August from 184 sales in July.
Ironically,the benchmark selling price for a typical single-family home in Kamloops managed to inch up to $664,300 in August from $658,400 in July.
The townhouse benchmark also ticked up slightly to $528,800 in August from $526,300 in July.
The benchmark selling price for a typical condominium did drop to $376,900 in August from $386,200 in July.
The current benchmarks are off the record-highs set in the spring of 2022 -- $820,990 for single-family, $569,400 for a townhouse and $403,323 for a condo.
It was high inflation and high interest rates that cooled the housing market from late 2022 onward.
Inflation has come down and interest rates are coming down slowly, but not enough to spur the housing market.
That's because people got used to mortgage interest rates of almost nothing three years ago, so they balked at 5%.
Plus, housing in Kamloops remains unaffordable for many, especially potential first-time buyers who are not only faced with some of the heftiest prices in the country, but big down payment requirements and big monthly mortgage payments.
"Much like other markets in the province, Kamloops and district real estate sales experienced a quieter than anticipated month of activity," concluded Sharun.
"With that slow sales activity, the region may potentially see some relief to a chronic lack of healthy inventory levels to meet the demand of the area."
Thumbnail photos credit: Realtor.ca
