MARKET UPDATE – April 1, 2018

Wed, 04 Apr by Dale Russell

The number of residential MLS sales in central Alberta in the first 3 months of 2018 was equal to the first 3 months of 2017.  Local markets vary, with Red Deer and Ponoka up year over year, while Sylvan Lake, Lacombe, Blackfalds, Penhold and Rocky are down.

The biggest challenge we face as realtors is the public’s assumption that economic recovery means an immediate return to increased sales and higher prices.  In fact, the real estate market recovery will lag two to three years behind this economic recovery, which is weaker and slower than past recoveries.

Further proof is that the combined median sale price of homes in eight central Alberta municipalities reached its lowest point in five years in the first quarter of 2018.  The previous low was reached two years after the last economic recovery was announced.

Overpricing is the single biggest mistake a seller can make in a market where there are far more sellers than buyers, and it leads to longer sale times, lower prices and seller frustration.  Less than 2 out of 10 homes listed on the MLS are selling each month in every central Alberta market.  The one or two that sell will be homes that are priced according to local market reality.

MARKET UPDATE – March 15, 2018

Fri, 23 Mar by Dale Russell

Sales in the first two weeks in March were down compared to the first two weeks of February in every market except Sylvan lake.  Sales were also down slightly compared to the first two weeks of February 2017 in most markets.

The number of active listings are up substantially in every market compared to last month and are also higher than last year at this time.  We attribute some of the extra listing activity to consumer confidence that the economy has turned and their desire to move after 3 years of slower markets.

It does seem busier although that hasn’t translated to hard sales yet.  A resolution to the conflict between Alberta and B.C. over the pipeline would go a long way to improving consumer confidence and market activity.

MARKET UPDATE – March 1, 2018

Fri, 23 Mar by Dale Russell

Most central Alberta markets we serve are keeping pace with last year while Red Deer is showing signs of improvement.  We can’t see it in all the numbers yet, but there is no doubt that we are feeling more  public optimism than we’ve experienced for much of the last three years.

The reasons for optimism include stable oil prices above $60US, 55,000 new jobs in Alberta in 2017 resulting in lower unemployment, and the general feeling that the recession is behind us.

The number of active listings is up in all central our Alberta markets.  More people wanting to sell in a recovering market suggests more confident consumers with a different motivation than we saw a couple of years ago when people were selling because they had to.  Now, they may be selling because they want to.  More listings will put the brakes on any price inflation they may be anticipating.

We have consistently stated that the real estate market takes time to recover once the economy has turned around.  We’ve also said that it’s hard to time the market perfectly and the recovery can sneak up on you.  All of our central Alberta markets favor buyers at the moment.  Interest rates are still relatively low and future increases are possible.  It’s a great time to take advantage of low prices and ample inventories.

MARKET UPDATE – February 15, 2018

Fri, 23 Feb by Dale Russell

Sales in the first two weeks in February were up over the same period in January in most central Alberta markets.  Sales were down slightly or about the same as the first two weeks of February 2017 in most markets.

The number of active listings is up in every market compared to last month which is normal for this time of year.  Some of the listing activity is old listings that didn’t sell last year coming back on in time for spring.

It does seem busier although that hasn’t translated to hard sales yet.  A resolution to the conflict between Alberta and B.C. over the pipeline would go a long way to improving consumer confidence and market activity.

MARKET UPDATE – February 1, 2018

Thu, 08 Feb by Dale Russell

January sales in Lacombe almost kept pace with last year while strong sales in Red Deer brought some sunshine into the market, something we don’t usually expect to see until March or April.  In both markets the number of active listings remains stubbornly high for this time of year, keeping the demand/supply ratio in buyer’s territory and we may have to wait a little to declare the market back to normal.

Where is the housing market going in 2018?  The provincial government has announced an end to the 3 year recession – very good news, but there are still some challenges lurking, including another potential delay to the Kinder Morgan Pipeline by the BC government.  While it’s nice to see West Texas oil trading in the $65US range, Alberta producers are only getting about half that much right now because we have only one customer to sell our oil to – the US.  With the likelihood of more delays to that pipeline, capital and equipment are moving south to a friendlier U.S. environment and some of those jobs we had back may disappear.

The Alberta economy runs on energy and will continue to do so for the foreseeable future.  The energy industry needs access to new markets to generate investment and the jobs that come with it.  Jobs create population growth and wealth.  Population growth and wealth creates housing market activity.  A quick resolution to the pipeline delay will help get our housing market back on track.

MARKET UPDATE – January 15, 2018

Tue, 23 Jan by Dale Russell

Sales were lower in most central Alberta markets in the first two weeks of January compared to December, probably, as a result of extra activity in December caused by the mortgage rule changes. Sales were on par with the first two weeks of January 2017 in most markets, but up significantly in Red Deer. Hopefully that is an indication that the market is indeed turning. The active listing count is still higher than normal which will keep prices stable for now.

MARKET UPDATE – January 1, 2018

Tue, 23 Jan by Dale Russell

Sales in Lacombe in December were down slightly compared to November, and down substantially compared to December 2016.  The number of active listings is down but still higher than this time a year ago.  The supply of homes relative to the demand in 2017 has kept the market firmly in buyer’s territory and some buyers have taken advantage.

The Alberta economy grew at more than 4% in 2017 which means that we made up some of the ground lost in 2015 and 2016.  The economy is predicted to grow again in 2018, but a little slower at about 2%.  It’s likely those two years of growth will contribute to a more stable real estate market.  No one is predicting a boom, but it is highly possible that prices have hit bottom.

There are signs that interest rates have the potential to increase some more over the next year.  Combined with the new mortgage rules, that could make it more challenging for buyers who wait.  Predicting the future is a fool’s game.  The only way to know the market has turned is to see prices going up, which means you’ve missed the bottom.

We know that owning a home is one of the best investments you can make.  For those who are thinking about buying their first home or moving up, the signs suggest that now might be the opportune time to act on those thoughts.

MARKET UPDATE – December 15, 2017

Fri, 22 Dec by Dale Russell

MARKET UPDATE – December 1, 2017

Fri, 22 Dec by Dale Russell

Sales in Lacombe in November were up compared to October’s and down slightly compared to last November.  The number of active listings is also lower, but the sales to active listing ratio at 7.8% is keeping buyers in the driver’s seat.   According to the Alberta Treasury Branch there are signs that the economy is gradually improving and we are hopeful that will translate into a more active market in 2018.

The key findings of ATB’s latest Economic Outlook are:

  • Alberta has emerged from two years of recession with real GDP growth of around four per cent in 2017.  ATB Financial’s Economics team is forecasting real GDP growth of 2.7 and 2.2 per cent in 2018 and 2019, respectively.
  • Retail and housing sector performance has improved.
  • Oil prices have steadied, and have begun to inch higher (currently around $US 55 per barrel).
  • Alberta’s energy sector will grow this year.
  • Tourism, agriculture and agri-food will continue to show steady growth.
  • Net out-migration to other provinces is likely to taper off but continue at a slower rate next year.
  • Alberta is expected to see a stubbornly high unemployment rate in 2017 and 2018.

MARKET UPDATE – November 15, 2017

Tue, 21 Nov by Dale Russell