MARKET UPDATE – December 1 2016
November sales in Red Deer were average compared to last year at this time, and were down from last month, which is normal for this time of year. The number of active listings is down to last year’s levels. There is no doubt many listings have come off the market recently as a result of slower activity, with the intention to come back on in the spring.
Two recent developments will almost certainly impact our local economy in the coming year. First, OPEC announced an agreement with its member states to reduce oil production by 1.2 million barrels per day starting in January. It’s difficult to predict whether the participants will actually live up to their promises, but oil prices immediately moved above the magic $US50 mark and are predicted to move higher with some predictions as high as $US70 by the end of 2017.
Second, the federal government approved two pipelines, one to the US and the Kinder Morgan expansion to Vancouver. When complete, the Kinder Morgan expansion allows 600,000 additional barrels of oil per day to flow to Asian markets where it will receive world prices rather than the discounted prices we get from the US. These two announcements will undoubtedly boost consumer confidence and generate some desperately needed jobs for Albertans.
