Would You Rather Live in Calgary or in Kelowna BC?

In today’s video and livelovekelowna blog I am talking about living in Kelowna Versus Calgary.

I lived in Alberta for 23 years before moving back to BC in 2021, the last 18 of those 23 were spent in Calgary.

We lived mostly in the Northwest and the West side of Calgary, although I did live kind of inner-city Northwest for a short amount of time.

I could probably go on and on about the differences between living in Calgary and living in Kelowna, but I am going to focus on just four different areas to try and keep this video a little shorter than some of my other ones on the channel.

Let’sTalk About the Weather

One of my favourite topics is the weather. It is almost the end of October and Calgary already had 10 centimeters of snow.

I could probably just stop right there. Kelowna still has green grass, leaves on the trees and the average temperature here the last week has been around 10 or 12 degrees celsius.

The winter’s here in Kelowna are pretty mild, that said, last year was a little colder and had a little more snow than what the area is used to. So there are years that are anomalies, however, most winter’s it is above zero and when it does dip below freezing it averages around -4. 

Calgary on the other hand seems to skip fall and move right into the winter months right around now, the end of October.

It is not unusual to see snow in Calgary from October straight through until April.

That being said, Calgary is one of the sunniest areas in the country with over 330 days of sunshine and around 2400 hours compared to Kelowna’s 2200.

As for Spring and Summer…Kelowna seems to actually have a spring with the snow melt starting in February, it’s not crazy to think you’ll be golfing by mid to end of March.

The average temperature in the spring is around 15 degrees. Most golf courses in Calgary open around May long weekend, there are some that open earlier if there is opportunity, but those seem to be few and far between these days.

Kelowna doesn’t typically get a lot of rain in the Spring, hence the reason for ‘forest fire’ season as the 5th unofficial season in the Okanagan.

This year we did though which definitely cut down on the amount of forest fires we saw all summer.

I have to pick between Calgary and Kelowna for better overall, year round weather.

I'm going Kelowna, 100 times out of 100.

What are the Differences in Cost of Living?

This topic will definitely make it into one of my next videos around what we didn’t know about moving here to Kelowna, the cost of living.

I’m going to just come right out and say it at the beginning of this section, Calgary and Alberta overall have this hands down.

Let’s start with the price of gas, there is a good 50 cent per litre gap between what you pay in Kelowna and what you pay in Calgary.

This works out, at least for me, to around an extra $30 to $40 per tank of gas, this can be significant if you drive for a living.

Next is groceries, now I know the cost of EVERYTHING is up right now, but even when it wasn’t back in June of 2021 we saw a significant difference in what you would get in a, quote unquote, bag of groceries. Believe it or not, fruit is more expensive here.

That’s like the gas prices being reversed, it would be like Calgary’s average is $1.90 per litre and Kelowna is $1.30! 

There is a lot more to cover, but I am going to end this segment off by talking about taxes. 

Yes, BC has a provincial sales tax of 7% which means in total you are going to pay 12% on EVERYTHING. Alberta doesn’t have a PST. Land Transfer Tax.

When you purchase a home in BC you have to pay a land transfer tax of 1% on the first $200k and 2% on the balance between $200k and $2 Million and then 3% up to $3 Million aaaaaaand an additional 2% over and above 3 Million dollars. So, on a $4 Million dollar purchase your total tax amount would be $118,000.

Like my ole pappy used to say, if you can afford the Mercedes you can afford the oil changes. 

The Health Care System.

Yes it’s 2022 and the health care system in Canada seems to be really messed up right now, but I will say that coming from what we knew in Alberta to what we are seeing here in BC, the differences are staggering.

Ok first, we had a family doctor for over 20 years when we lived in Calgary, when we moved to Kelowna, we were without a family doctor for the first 6 months.

We added ourselves to wait lists and then finally found a clinic that was taking new patients all the way out in West Kelowna.

We are happy now to drive that distance, simply because we have a family doctor that we really like. Beyond that, it is access to things like getting X-Rays and MRI’s and getting into a physiotherapist, Calgary slash Alberta has BC beat in these areas all day long.

Also, if you are an entrepreneur coming from Alberta and need extended benefits, I would definitely suggest shopping around. We had Blue Cross in Alberta and we had a hard time finding anything that compared to the plans that they had.

Are the Outdoor Activities Better in Calgary or Kelowna

I have done a few videos now on things to do in and around Kelowna. We love to get outside, it is a large part of the reason that we moved here.

We can be at a trailhead in about 15 minutes if we walk there.

We can be at the beach on Okanagan lake in about 7 minutes from our home.

We can head out mountain biking, right out our front door to Okanagan Mountain.

If we want to hike some more we can head over to Knox Mountain or do Pauls Tomb and be at the trailhead in about 20 minutes.

I can hit a golf course in about 9 minutes from where I live.

Of course there are pickleball courts, tennis courts, basketball and beach volleyball courts all very close to where we live. If we want to ski in the winter time, Big White is 45 minutes away.

Contrast that with Calgary and the vast majority of these activities are done outside of town with the exception of pickleball, golf and some in the city hiking in areas like Nose Hill or the Douglas Fir Trail.

Most of these things are a drive away from wherever you live in Calgary, you would be packing up the bikes or packing for an afternoon to head out to a lake outside the city, unless of course you live IN a lake community like Arbour Lake or Lake Bonavista.

Overall, it seems we have come to a draw, two for Calgary and two for Kelowna.

Don't let the negatives in this post and video above scare you off, transferring from one province to another isn't as easy as you may think.

It's almost like going from one country to another, there are a lot of things that you need to get used to especially when the political climates are so vastly different.

That said, if the great didn’t far outweigh the good, we never would have made the move.

Calgary is a great city and an awesome place to raise a family, if you are looking for a slower pace and a climate where you can be outdoors pretty much all year round and not be locked inside sheltering from the freezing cold, then the Okanagan is calling.

If you have any questions about making a move to Kelowna….especially from Calgary, then give me a call or send me a text to 403-827-7527 or shoot me an email to kelley@kelleyskar.com

What to Expect When Investing in Short Term Rentals in Kelowna, BC

So you’re thinking of investing in the Kelowna Real Estate Market? Well you’ve come to the website! 

In today’s blog and video (scroll down) we are going to be talking about investing in Short Term Rentals or STR’s here in the Kelowna and Okanagan market.

Here's what we will be covering in this video and blog post:

1. The cost of purchasing for those of you investing from outside of BC

2. Home Prices and what to expect

3. The cost of carrying the property

4. The buildings that allow for STRs in the Kelowna Market

5. How to set up your STR for massive positive cash flow

The Cost's of Investing in Kelowna, BC

Ok let’s jump into the cost of purchasing a property here in Kelowna and BC, now if you are an investor from Saskatchewan or Alberta you likely aren’t familiar with a land transfer tax.

If you are purchasing an investment property or simply making a move to BC you will have to pay a tax out of pocket at closing time of 1% on the first $200,000 and 2% on the balance up to $2 million dollars.

Now, on top of that tax, because you are an investor, the BC government has seen fit to penalize you even further. If you are investing in Kelowna or in West Kelowna you will also be subject to a ‘sunshine’ or speculation tax of .5% of the assessed value of the home.

This is applied if you plan to have renters in the property or if you spend less than 6 months in the home in total.

This can be a shock to the system so make sure you are prepared and that you have enough cash to close on top of your regular disbursements as well as legal fees which can run between $1500 and $2500 dollars.

Because this is an investment property you will need at least 20% of the purchase price as a downpayment. Your deposit (which here in BC is held by the buyer’s agent’s brokerage) should be around 1.5 to 3% of the purchase price depending on the price point of the home.

Ok last point about cost’s…GST. Yes, there is a VERY good chance that GST will be applicable in the purchase of an investment property for the use as an STR.

The best thing you can do is to consult with your accountant PRIOR to making an investment like this so that you can get your financial situation set up properly prior to making an offer.

Kelowna's Home Prices

Ok now that’s out of the way let’s look at point number 2 which is home prices here in the Kelowna area. If you are not wanting to put down a large downpayment then it is important to keep your purchase price lower. 

That means you are likely looking at apartment style condos as an option or half duplexes as opposed to a single family home. 

With the benchmark sale price of single family homes here in the central okanagan in October of 2022 running around $980,000, your downpayment amount would have to be $196,000.

Some of the condo options that are seeing right now in buildings that allow for STRs are in the mid $500k range so your downpayment would be about half which would allow you to look at multiple properties as opposed to just one.

The Cost to Carry Your Short Term Rental in Kelowna

Your cost’s to carry are going to be similar to what you would have in your current province, you’ll have property taxes and likely condo fees and of course you will likely need a property manager to ensure your investment is being looked after.

Expect your condo fees to be somewhere between $400 and $800 per month, again, depending on the building, the size and location. 

Your property taxes can range but likely won’t be less than $2000 per year, always factor in the high side and if you need some help with determining taxes a lot of times it is right on Realtor dot ca.

If you are purchasing a single family property you will have all utilities that you’ll be responsible for and in condos typically you’ll be on the hook for just electricity. 

That being said, some buildings include all of the utilities into the condo fees so make sure to inquire about that up front.

You will need to buck up for Netflix, cable and possibly an alarm of some kind if you are in the single family market. 

Lastly, your property management fees for STRs will run you anywhere from 20% to 40% of the gross revenue.

I know, I know, it sounds high but think about it for a second, the PM is turning over your property every 3.5 to 5 nights. They are refreshing towels and toiletries, replacing dishes and cutlery, making sure the coffee is stocked and that the property is spotless and ready for the next guest.

What Buildings Allow Short Term Rentals in Kelowna?

If we are investing in condos in the Kelowna market then you will need to know which buildings allow for STRs.

Recently Kelowna city council decided that any new building that is built will not be allowed to offer short term rentals, so there are a set number of buildings in Kelowna that allow for them.

Here’s the list:

1. Brooklyn

2. Barnoa Beach

3. Copper Sky

4. Discovery Bay

5. Playa del Sol

6. St Paul

7. Sole Downtown

8. Sunset Waterfront

9. The Cove

If you are looking for listings in any of these buildings then make sure to reach out and send me an email at kelley@kelleyskar.com and I’ll send them over to you right away.

If you are looking at a single family, make sure it isn’t a bareland strata, most of these will not allow for STRs. Also, if there is an HOA or Home Owner Association, make sure to check in the bylaws to ensure that they allow for STRs. 

How to Set up Your Kelowna Short Term Rental for Maximum Positive Cash Flow

The last point, point #5 is how to set your STR up for maximum positive cashflow.

So let’s use an example of a property in Playa del Sol listed by Century21. A 2 bedroom 2 bath top floor unit that is currently asking $580,000.

So let’s say you put down your 20%, you’ve paid your sunshine tax, your land transfer tax and you’ve employed a property manager to help you get this investment of yours rented out.

What you’ll be looking to do is make this unit available between May 1st and September 30th for nightly occupancy.

These are your PRIME months to maximize.

You could be looking at anywhere from $200-$500 per night in this building during those months. So let’s take the median at $350 per night.

What we know is that most Air BnB property management companies can get you rented for 21 days out of the month, so let’s just go based off of that. You may be full up for those months, but again, let’s make sure we err on the side of caution.

Your gross monthly revenue would be $7350. Now, you’d take off of the PM fees of 20% and you’re left with $5880. Condo fees on this property are $730 so now you’re down to $5150.

Your mortgage payment based on a 5 year fixed of 5.7% would be around $2600 which would leave you with $2550 and property taxes at $180 per month would bring you to a grand net total of $2370. 

Now, that doesn’t sound like a lot but remember that we were conservative on the occupancy, if you added another 9 days to that number you could be a lot close to $5k per month.

Once October 1st rolls around you are going to want to find a short term tenant for this property, October 1st to April 30th would be ideal. Expect your monthly rent on a property similar to this to be around the $2400 to $3000 per month mark.

If you want to get deeper into the economics of how the monthly and the STR can work together then let’s schedule a call. 

When you’re looking to invest in the Kelowna real estate market, it’s important you have a full time guide with multiple years of experience to help you along the way.

If you are interested in booking a call with me you can call or text 403-827-7527 or send me an email to kelley@kelleyskar.com.

Where is Kelowna's Housing Market Headed

WIth the perceived recent correction in pricing in the Okanagan Valley, I seem to be getting this question a lot lately, my answer my shock some that are expecting a massive shift in the market.

Those that know this area and understand economics will not be shocked, they know what the ebbs and flows are like in the Kelowna Real Estate Market.

Here are some stats for the market as a whole for the month of September:

• Benchmark Pricing for Single Family: UP 1.6%
• Benchamark Pricing for Townhomes: UP 7.9%
• Benchmark Pricing for Condos: UP 8.9%
• Sales for SF: DOWN 36%
• Sales for TH: DOWN 37%
• Sales for Condos: DOWN 37%

If we compare Q1 of 2022 to the same time in 2021 we saw an increase in prices for single family homes in Kelowna of 34%.

If we look at Q2 of 2022 and compare to the same time in 2021, we saw an increase of 15% of single family home pricing in the Kelowna market.

The Q3 numbers are going to be pretty close to the second quarter with an increase of 14.6% in the single family home market.

Is There a Trend Forming in the Kelowna Real Estate Market?

We we can certainly see something starting to form, what I can tell you is that sales in every housing category for every quarter of this year are down in some cases well over 30%.

Q1 prices saw an increase in the benchmark and Q3 is less than half of that increase, there is a very good case to be made that prices will continue to increase but at a much slower rate than what we have been witness to.

Inflation, interest rates and a pending recession will all have an affect on the housing market in 2023 here in the Okanagan Valley.

Is it better to wait to buy a home in Kelowna?

Is it better to wait and sell your current Kelowna home?

Well the answer to the first question can be found in the video that is embedded below. In this video I interview Clayton Blaney of Blaney Mortgage, we talk about housing affordability and compare March of 2022 to September of this year.

His graphic may surprise you, I know it did me.

The answer to the second question is this, if you are looking to sell and take advantage of your Kelowna equity lottery win, now is the time to do that.

Thing is you HAVE to have some patience, as mentioned earlier in this post, sales are down and so is demand. The average days on market is far higher than it was last year, so not only do we have to be realistic about pricing but we also have to be realistic about your time to sell.

If you want more information on what your home is worth in the Kelowna market, you can either click here to contact me or simple give me a call at 778-716-7527.