Another good month in February, and another month where single family properties under $500k are still in very high demand. Low inventory is still a running theme, and I believe it will continue to be for at least a couple of years.
A recent survey of Alberta businesses found that 83 per cent are optimistic about the business environment over the next five years. The 2024 Alberta budget predicts a small surplus based on average oil prices of $74 per barrel even though provincial expenditures will be 4.4% higher than last year. Included is some debt reduction as well as a couple of billion dollars added to the Heritage Savings Fund.
A strong economy combined with all that enthusiasm encourages more people to move here and puts more strain on our housing market. A recent news article suggested that Red Deer house prices inflated by 13 percent last year. Price changes are difficult to calculate in our small market because the average can be easily skewed by just a few transactions. Our experience suggests the lower price ranges may have inflated by more than 10% in the past year while the higher price ranges haven’t inflated nearly as much.
The central Alberta market is experiencing strong sales and continued marginal supply, much like last year, except that inventories are consistently lower in all our markets. Central Alberta year to date sales are up 16% compared to 2023 while the number of active listings March 1, 2024 was down 22% compared to March 1, 2023. Lower interest rates and higher prices will encourage builders to add inventory which is the only answer for our busy market.
Surrounding Community Snapshot:
Blackfalds:
Current Active Listings – 34
Sales in February – 17
Likelihood to Sell – 50% (Seller’s Market)
Sylvan Lake:
Current Active Listings – 101
Sales in February – 40
Likelihood to Sell – 39.6% (Balanced Market)
Penhold:
Current Active Listings – 16
Sales in February – 1
Likelihood to Sell – 7% (Buyer’s Market)
**Note: Inventory went up in Penhold very quickly and sales haven’t had a chance to adapt, so this stat is deceiving and should rectify next month.
