November 15, 2013 – Market Update
Sales in the first half of November in Red Deer were down slightly from the same period in October as well as the same period in 2012. The number of active listings is down very slightly and is holding at a level that keeps the market in balance – where neither the seller or the buyer has the advantage.
Sales activity is strongest in the $300,000 – $400,000 price range which is also where there are the most active listings. A good, balanced market as well if the current trends continue. The market where the buyer still has the advantage is in the $400,000 plus price range where the sales to listing ratio is lower.
The long term forecast for Alberta remains strong as we continue to lead the country in growth. That growth should support a good real estate market going into 2014. Strong building starts in both the residential and commercial sector are huge contributors to a strong economy.
Building permits inch higher – Todd Hirsch, Chief Economist, ATB Financial
Construction activity is an important driver of Alberta’s economy, and over the last few years it has remained remarkably steady. New information released by Statistics Canada suggests this trend will continue in 2014.
Alberta’s total building permits are an excellent indicator of future construction activity. In September, they rose 5.2 per cent over the previous month, to $1.43 billion. However, residential and non-residential permits moved in opposite directions.
Residential builders took out $954 million in permits in September, a steep jump from August and the second-highest single month on record. (The all-time record of $978 million was set in June of 2007.) The rising value of residential permits suggests that home builders are reacting to strong demand for new homes. This is consistent with other residential real estate indicators, such as home sales and rising prices, for both new and existing homes. It also makes sense given the steady inflow of interprovincial migrants to Alberta this year.
The increase in residential permits was almost completely offset by a drop in non-residential permits. They tumbled 18 per cent month-over-month to $475 million. That’s a nine-month low. The size and scope of some non-residential construction projects, including office towers, shopping malls and industrial complexes, makes them much more volatile month to month.
Combined total building permits in Alberta continue to rise. Over the last twelve months, permits are 19.7 per cent higher than the previous twelve months. This bodes well for construction spending and employment in the near-term.
