It was another positive month for real estate in Red Deer. 23% of our inventory sold in September, and sales increased just slightly over August, leaving us in a nicely balanced market. The story on the market remains unchanged, single family sales under $600,000 remain very strong, while other markets continue to see activity but at a much slower pace. All market segments have seen an increase in activity over the same time a year ago, except for the condo market, which is currently dealing with a large increase in available inventory levels.
While I don’t ever put a lot of weight on average prices, looking at average prices through the market segments over the last 12 months shows a hefty increase compared to last year. The overall market picture shows a 12.7% increase, or $37,910 compared to September of 2020, reinforcing the fact that a hot market has driven prices up. While 12.7% is way too general of a stat to accurately use on any given property, the break down in the different market segments shows single family homes have increase 9.5%, while duplexes and townhouses are only up 3.1%. Apartment condos are showing a 16.1% increase, however we finally saw some sales over $400,000 for condos in September, which drastically increases average pricing in a segment that sees the majority of its sales under $200,000.
I’ve mentioned a few times this year that duplexes and townhouses haven’t seen the same level of demand as single family homes. Many buyers make their buying decisions based on the amount they are pre-approved for, or on their comfort level with monthly payments. Buyer’s generally want the best house available for what they can afford. Low interest rates have kept single family homes affordable, despite the increase in prices, and buyers will generally always opt to not share a wall if they can afford to do so. In order to see a larger increase in duplex and townhouse pricing, we’ll need to see further increase in single family prices to the point where the next best option for a buyer with limited price capacity will be to share a common wall.
Surrounding community snapshot:
Current Active Listings – 94
Sales in September – 24
Likelihood to Sell – 25.5% (balanced market)
Current Active Listings – 142
Sales in September – 37
Likelihood to Sell – 25.7% (balanced market)
Current Active Listings – 40
Sales in September – 9
Likelihood to Sell – 25% (balanced market)