Last November Western Investor chose tiny Bamfield and popular Penticton among the top five towns for western real estate investors in 2023. We now add the Vernon-area beachfront community of Coldstream to our picks for three hot recreational markets in B.C. to watch this summer.
The first highway into this tiny Pacific Rim town, a near-two-hour drive west from Port Alberni on Vancouver Island, was completed this year.
While land and home prices shot up in with the new road, Bamfield residents are gun-shy when they hear talk of boom times coming.
That’s because, back in the late 1990s, a crooked lawyer and alleged drug smuggler bought up virtually every business – 11 properties – in the town and let them all fall into disrepair as he used them to launder money.
Today, the businesses have been repurchased and revived, the lawyer was arrested and disgraced and Bamfield is back on track to become the next Tofino, according to local real estate agents.
After 2020, when work started to change a rough logging road to an all-season highway, the average price of a Bamfield detached house soared from $472,000 to $728,000. But, since the start of this year, average Bamfield house prices have fallen nearly 10 per cent to $662,200, though there are few listings.
There are currently nine properties for sale in or near Bamfield, ranging from a $278,000 waterfront lot to a $1.1 million oceanfront house.
Craig Filipchuk, an agent with Re/Max Mid Island, said Bamfield has a new residential subdivision underway and there are current opportunities in short-term rentals as word spreads about the oceanfront community. Listings are priced well below those of Ucluelet and Tofino, the better known Pacific Rim communities that are separated by water from Bamfield.
For those who fear they missed the Kelowna boom over the last few years, Penticton offers an opportunity to share in one of the top recreational markets in Canada – at lower prices.
Penticton, approximately 45 minutes from Kelowna in the South Okanagan, has lakefront beaches, various outdoor activities, a tourist-attracting food and wine scene, and top-of-the-line recreational facilities. Penticton’s population has increased 9 per cent from 2016 to 2021 – and the rental vacancy rate has fallen to 1.1 per cent, according to Canada Mortgage and Housing Corp.
Unlike Kelowna, Penticton is not subject to B.C.’s speculation tax and vacant-home tax, noted Anthony Haddad, Penticton’s general manager of community services.
Haddad said the city has launched its ambitious North Gateway Plan, which will eventually add 2,0000 new homes in a massive redevelopment. North Gateway, located within the city’s northwest corner, includes plans for boutique shops,a variety of housing types, hotels and entertainment and recreation amenities. The plan also calls for up to 350 new hotel rooms, almost 30,000 square feet of new commercial space.
Word appears to be spreading. This July, a new 110-room Four Points by Sheraton hotel will open next to the Penticton Convention Centre.
Currently, the average price of a detached house in Penticton is $754,500, which is down 8.7 per cent from a year ago, according to the Association of Interior Realtors, and well below the current $1.1 million average in Kelowna.
Prices for waterfront house in the Penticton area are $1.03 million, down 24 per cent from last year and, as of May 1, there were 22 such properties listed, double the number of a year ago.
Shane Styles, president of Epic Real Estate Solutions Inc., Penticton, sees short-term rentals and the condo market as investor targets in the South Okanagan’s biggest city.
Unlike Kelowna and Summerland, Penticton does not restrict short-term rentals. According to a report by a consulting firm hired by Penticton to study the city’s short-term rental policy, there are about 500 such rentals, most full houses, representing about 1 per cent of the city’s rental stock.
These rentals posted an annual average revenue of $54,000 in 2022, the report found. The average rent for a short-term rental is $461 per day.
Kerkhoff Construction is building the 234-unit Sokana, an investor-friendly condo development, where the suites can be used for vacation rentals.
Styles said the Sokana units, are pre-selling, starting in the $300,000 range.
The District of Coldstream, in the North Okanagan, is a lakefront community adjacent to the city of Vernon. It has approved a three-year strategic plan that could encourage growth in the neighbourhood, which has among the highest real estate prices in the region.
Replacement of the aging Kal Beach pier has begun, as part of Coldstream's Head of the Lake Plan, a vision of future development and attractions around the Kalamalka Lake beachfront.
A housing review that will support "modest population growth" is up for discussion this year. A review of agri-tourism in Coldstream is anticipated in the third quarter.
This is an Okanagan market to keep an eye on.