January 5 2015 – Market Update
Red Deer residential sales end of the year on a very positive note with annual sales up to up more than 10% over last year’s pace. For the first time ever, there were at least 100 sales and every month of the year, although we didn’t quite make the total sales achieved in 2007 (2240). New homebuilders obviously did a good job this year as inventories pretty well kept pace and are in good shape going into the New Year.
Sales in all of central Alberta were up just over 13% from 2013 while the active listing count is down substantially in almost every market. That bodes well for home prices if the energy industry and the economy suffer from the current low oil price situation. Going into a slower market with lots of inventory could trigger price pressure as long as the building industry refrains from adding too much inventory in the way of new spec homes, the market should be able to sustain a period of its slower activity.
We don’t know what the future holds for Alberta’s economy, but we believe the housing market can weather a short term slowdown of a year or so without too many casualties. We do believe, like many others, that oil prices will recover within the next year or two and the Alberta economy will continue to lead the rest of the country in spite of short-term setbacks.
