The central Alberta residential real estate market in September performed much like we expected, although sales picked up slightly in the last week and came out a bit higher than forecasted.  Sales were down 19% compared to September 2021 and down 18% compared to August of this year.  While we’re still in an overall balanced market, and prices seem to be mostly stable at the moment, they’re still down significantly compared to the spring and early summer months.

Mortgage rates are certainly impacting the market, although some of the impact is likely a result of consumers absorbing national news stories about Bank of Canada interest rates (which do not directly affect mortgage rates), stories about real estate prices collapsing in Toronto and Vancouver and stories about inflation and its impact on Canadians lives.  The average consumer only hears that real estate sales and prices are plunging or that the Bank of Canada keeps raising interest rates with more to come.  Those “facts” combined with their face to face to confrontations with rising costs are likely causing them to be more cautious which contributes to slower sales.

On a more positive note, prices in Alberta are the most affordable in the country which means those higher interest rates have less impact compared to markets in Ontario and BC.  Five year fixed rate mortgages are still available as low as 4.89%, which is very low historically speaking, although it will take time for the younger generation (40 and under generally speaking) to adapt to what seems like high rates compared to what they are used to.  The Alberta economy overall is very strong and will weather the incoming recession much better than the rest of the country.

Surrounding Community Snapshot:

Blackfalds:

Current Active Listings – 58

Sales in September – 19

Likelihood to Sell – 32% (balanced market)

Sylvan Lake:

Current Active Listings – 135

Sales in September – 42

Likelihood to Sell – 31.1% (balanced market)

Penhold:

Current Active Listings – 22

Sales in September – 7

Likelihood to Sell – 31.1% (balanced market)