Tuesday, January 20, 2009
I forecast Slow and Steady for 2009 Housing Sales
posted in General
at Tue, 20 Jan 2009 18:32:12 +0000
I am confident that, despite the global economic uncertainty, Edmonton and area can expect a reasonably good year ahead.
Buyer reluctance will continue through the first part of the year. But confidence will return in the latter part of the year and sales will pick up. I predict that total residential sales through the Multiple Listing Service® will be down slightly when compared to 2008 figures. Sales in 2008 totalled 17,317 and REALTORS® expect to sell just 15,500 homes in 2009.
The rapid increase in housing prices in 2006-7 was unsustainable and single family dwelling prices levelled off at around $350,000 in 2008. I expect that the average price of SFDs will vary throughout the year but will be at about the same level when the Christmas trees are put up next December.
A large inventory of new condominiums could enter the market in 2009. This will put downward pressure on resale condos and average prices are expected to drop about 5%. The average price of a condo in December 2008 was $234,286. I expect that the average price will be $222,500 at the end of 2009.
While sales will be slower overall in 2009, buyers will still benefit from the wide choice of property available. Inventory will continue to drop through the year. I would urge buyers to make a buying decision before the options become limited. Sellers will have to compete for the attention of buyers and should improve the curb appeal of their homes to remove negatives that reduce the opportunities of a sale.
I would remind homebuyers to focus on the purchase of a residential property that matches their families lifestyle needs rather than their financial needs. They should find a home that makes them happy and ignore the day-to-day fluctuations of the market until they need to move again.
The sales-to-listing ratio of recreational properties in 2008 was just 26%. The decrease in value of stock market portfolios and other investments may mean that some clients will need to liquidate recreational properties. This suggests there may be bargains in this sector this year.