Red Deer had a great month in December, posting 99 sales, with only 211 listings currently on the market. This marks a significant improvement from December 2022 which posted 64 sales. The notable shift from last year to now is primarily due to there being more certainty around interest rates. In August 2022, the market slowed down after an otherwise crazy 7 months, following the last interest rate hike in July. The uncertainty surrounding rate trends and inflation at that time made potential homebuyers hesitant to move forward, and the market didn’t jump back to its current hectic pace again until March of 2023.
Looking ahead to 2024, forecasts suggest we’re going to see rates come down, setting the stage for another dynamic year. Low inventory levels will be an ongoing theme due to continued immigration driven by a strong economy, thriving job market, and an overall low cost of living in our province compared to the rest of the country. As rates come down, more buyers will come into the market, and high demand and low inventory will inevitably push prices up. I was involved in two multiple-offer situations between Christmas and New Year’s for properties in the 250-350k range, a segment that has been in high demand over the past year, but it’s rare to have buyers competing for properties in December.
I anticipate we’ll see more multiple offers and homes selling for over the list price this year. Unlike last year, where many homes in multiple-offer situations sold at or slightly above the asking price, or sometimes even under the list price, I believe the demand will be substantial for homes under $700,000. With improving interest rates, we may also witness increased activity in the higher-end market, as built up equity from increased property values will allow buyers to move up into more expensive homes without increasing their mortgage amounts.
I expect we’re going to see builders see an increase in activity this year as well, as many people needing new homes are going to get tired of fighting over re-sale properties and just commit to building new and getting exactly what they want.
Surrounding Community Snapshot:
Current Active Listings – 29
Sales in December – 13
Likelihood to Sell – 45% (Seller’s Market)
Current Active Listings – 94
Sales in December – 18
Likelihood to Sell – 19% (Buyer’s Market)
Current Active Listings – 4
Sales in December – 6
Likelihood to Sell – 100% (Seller’s Market)