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This meant fewer of the older single-family homes were available for sale, creating an imbalance in supply and demand. Demand for these homes was not way up this year, it’s more there is a supply shortage, especially homes priced under $400,000 in core neighbourhoods.
Coming out of the most restrictive lockdown measures, June and July performed much better than March through May, however, sales are still down, year over year.
Historic low interest rates have helped to spur demand and sales, with many buyers able to lock in at two per cent or even less on insured mortgages. These rates, coupled with the buzz of activity in June and July, encouraged many to enter the market, even first-time buyers, regardless of the uncertainty with the pandemic.
Where do we go from here?
It’s no secret that many businesses are struggling and there will be layoffs and higher unemployment for a time.
How much and how long an effect is really the question, and, right now, no one can answer that question.
Without that information, we can’t predict or run models with any reliability.
I don’t think the news is all bad. If we put on our long lens and look further into the future five to 10 years, we can see this as an opportunity.
In the last five years, we’ve seen property values fall in Alberta while many other regions in Canada saw significant growth. This has created a bigger gap in relative values and gaps like to be filled.
The next year or two could present some great buying opportunities to position yourself as a real estate investor for the next boom, if I’m right.
Dennis Faulkner is a REALTOR® with RE/MAX Select. He can be contacted at [email protected]