Slower Start to 2026 as Inventory Improves and Buyers Gain More Choice
The Okanagan real estate market entered 2026 at a measured pace as economic uncertainty, higher unemployment, and cautious consumer confidence continued influencing buyer activity across the region. While market conditions remained relatively stable overall, sales activity and pricing continued to trend below long-term historical averages.
Kelowna’s unemployment rate climbed to 8.9% in March 2026 — the highest level seen since the early stages of the pandemic. Unlike previous downturns, however, this increase has not been caused by widespread layoffs. Instead, the local economy has struggled to generate enough new jobs to support the large number of people who relocated to the Okanagan over the past several years.
Across the entire Okanagan region, Q1 2026 recorded 1,605 residential sales totaling approximately $1.2 billion in dollar volume, representing a 3.8% decline in sales activity and a 6.5% reduction in transaction value compared to Q1 2025.
📍 Central Okanagan Market Overview
The Central Okanagan remained the region’s most active market through the first quarter of 2026, though conditions continued to favour buyers overall.
During Q1:
- 365 single-family homes sold
- 143 townhomes sold
- 233 condos and apartments sold
Inventory levels improved substantially compared to the supply shortages experienced during the pandemic years:
- 1,139 active single-family listings
- 389 active townhome listings
- 756 active condo/apartment listings
Homes also continued taking longer to sell compared with peak-market conditions:
- Single-family homes averaged 69 days on market
- Townhomes averaged 78 days
- Condos and apartments averaged 79 days
Although activity remains below historical norms, the increase in available inventory has created significantly more opportunity for buyers, particularly in price ranges under $1 million where supply has more than doubled compared to pandemic-era lows.
📍 North Okanagan Market Overview
The North Okanagan continued to show relative stability despite softer overall transaction volumes.
Q1 2026 sales included:
- 139 single-family home sales
- 50 townhome sales
- 41 condo/apartment sales
Inventory levels remained elevated:
- 340 active single-family listings
- 116 townhome listings
- 81 condo/apartment listings
Average selling times remained slower than balanced-market norms:
- Single-family homes averaged 88 days on market
- Townhomes averaged 64 days
- Condos averaged 92 days
The North Okanagan has generally held pricing more effectively than some higher-priced markets across BC, particularly within more affordable housing segments. Buyers continue benefiting from increased negotiating power, though properly priced homes are still moving steadily.
📍 South Okanagan Market Overview
The South Okanagan experienced softer activity overall but maintained relatively balanced inventory levels.
Q1 sales included:
- 142 single-family homes sold
- 43 townhomes sold
- 129 condos/apartments sold
Available inventory included:
- 462 active single-family listings
- 147 townhomes
- 271 condo/apartment listings
Average selling times were:
- 90 days for single-family homes
- 88 days for townhomes
- 70 days for condos/apartments
📍 Shuswap / Revelstoke Market Overview
The Shuswap and Revelstoke region remained relatively steady throughout the quarter.
Q1 activity included:
- 72 single-family sales
- 16 townhome sales
- 25 condo/apartment sales
Inventory totals sat at:
- 227 active single-family listings
- 42 townhome listings
- 46 condo/apartment listings
Average days on market were:
- 77 days for single-family homes
- 78 days for townhomes
- 81 days for condos
Inventory, Pricing & Market Conditions
One of the biggest shifts entering 2026 has been the improvement in available inventory. Active listings across the Okanagan totaled 5,356 properties in March 2026, while Q1 saw 4,833 new listings enter the market.
Despite softer economic conditions, the region has not experienced a major increase in financially distressed listings. Foreclosure properties have risen modestly and now sit at their highest levels in roughly a decade, though they still account for only 1.1% of total listings — far below levels seen during the downturn in 2016.
Pricing across most regions has remained relatively flat since the correction that followed the peak market of 2022. More affordable markets have generally held value better than luxury-oriented segments, while increased inventory has helped gradually improve affordability for local buyers.
Interest Rates & Policy Changes
The Bank of Canada has maintained its benchmark interest rate at 2.25% since October 2025. However, fixed mortgage rates have moved higher as bond yields climbed due to ongoing geopolitical tensions and U.S. tariff pressures. Expectations for additional significant rate cuts have faded considerably.
Meanwhile, Premier David Eby announced Kelowna is expected to receive an exemption from BC’s short-term rental restrictions due to the city’s elevated rental vacancy rate. If approved, this could help absorb a growing amount of condo inventory originally intended for short-term rental use while also supporting the region’s tourism economy.
Investor confidence remains cautious following several provincial policy changes introduced in the 2026 BC budget, including:
- Increased taxation on development lands
- PST expansion to certain housing-related services
- Higher Speculation & Vacancy Tax rates for foreign owners
🔍 Market Outlook
The Okanagan market continues transitioning toward more balanced conditions after several years of extreme supply shortages. Buyers now have substantially more inventory, more negotiating power, and more time to make purchasing decisions.
At the same time, spring showing activity increased noticeably throughout Q1 2026 thanks to an unusually mild winter. While much of that interest has not yet translated into closed sales, activity levels are expected to gradually improve heading into summer.
The federal government’s passage of Bill C-4 — introducing a GST rebate for first-time buyers purchasing newly built homes under $1 million — is also expected to support entry-level demand moving forward.
Overall, Q1 2026 reflected a market still working through economic uncertainty but gradually moving toward healthier balance. Buyers continue benefiting from improved selection and affordability compared to recent years, while sellers face a more competitive environment that rewards strategic pricing and strong presentation.
🤔 Thinking of Buying in 2026?
With ample inventory, reduced competition, and motivated sellers, early 2026 presents an excellent opportunity for buyers. Whether you’re upgrading, downsizing, or relocating to the Okanagan, this market offers negotiating power and selection. Want to explore your options? I offer a free, personalized buyer consultation to help you make confident and informed decisions.
👉 Let’s set up your custom home search
💡 Thinking of Selling?
Despite seasonal slowdowns, well-priced and well-presented homes continued to move in Q4. As the market transitions into spring, now is the time to prepare your home to stand out. I provide full-service marketing, staging support, and a clear pricing strategy to help you get top dollar.
📩 Reach out for your free home valuation