Residential real estate activity in Central Alberta continues to lag behind last year’s pace, but the gap appears to be narrowing.
The Central Alberta Realtors Association reported on Wednesday that home sales in the region hit a six-month high in March, with 123 transactions processed through the Multiple Listing Service in Red Deer and 169 in the surrounding area. The combined total is 23 per cent fewer than the 380 city and rural sales in March 2008, but that difference is smaller than in any of the preceding four months.
“If you want to get in at the bottom, it’s probably around this time,” suggested association president Derek Austin, who owns Century 21 Your Realty in Innisfail.
Austin thinks the real estate market will be busier this month, explaining that buyers and sellers tend to become more active as the weather warms. He also believes people are tired of the negative news and are now realizing that the world is not ending.
There is plenty to be optimistic about in Central Alberta, he added, offering as an example major construction projects like the proposed Holiday Inn in Gasoline Alley.
Austin thinks there is a growing awareness of the record low interest rates and reduced home prices as well. And he doesn’t believe federal and provincial stimulus programs have had an effect yet.
“You add those things together, what better time to get into the market?”
The median price of homes sold in Central Alberta last month was $260,000, according to the Central Alberta Realtors Association. That’s down eight per cent from the $283,000 figure for the same month in 2008.
Austin said a better comparison is 2005, prior to the sharp run-up in prices and sales volumes.
In March of that year, single-family dwellings in Red Deer sold for a median price of $182,000. A year ago, the median price for the same type of property was $335,000, and last month it was $326,230.
Prices and sales figures over the past few years were an “anomaly,” said Austin, and are unlikely to be repeated in the near future.
“That would be unreasonable to think that we’d still have the same number of sales.”
Central Alberta Realtors Association said new MLS residential listings for Central Alberta declined 15 per cent last month, as compared with a year earlier. It marked the third consecutive month that new listings have decreased, and contributed to five per cent drop in total active listings.
In Red Deer alone, new listings slid 29 per cent.
Austin said the forces of supply and demand should exert upward pressure on prices, although listing numbers should increase as spring continues.
Nationally, the number of existing homes sold last month was down from a year ago but continued an upward trend that began in February, said the Canadian Real Estate Association.
The association also reported that the national average price for homes fell again in March, compared with the same month last year.
“Housing markets are starting to show signs of buyer interest because of lower prices and interest rates,” CREA president Dale Ripplinger said in a statement.
The year-over-year decline in March sales was 13.5 per cent, but the smallest 2008-to-2009 decrease in six months.
The average house price in Canada fell to just under $289,000 — down 7.7 per cent from March 2008 — also the smallest year-to-year decline in six months.
Robert Kavcic, of BMO Capital Markets, wrote in a separate analysis saying that “the improvement in recent months is an encouraging sign that the Canadian housing market has crossed the halfway point for this downturn.”
“Despite two months of improved sales activity, buyers are still in control of the Canadian real estate market,” Kavcic wrote.
“Further price declines and low mortgage rates will ultimately help trigger a recovery, but a reversal in the wave of job losses is one major pre-requisite still outstanding.”
With files from The Canadian Press