Several homeowners have been seeing their market values drop and waiting longer to sell their homes, as housing prices have cooled down in St. Paul.
Inventory left over from 2015 as well as 15 additional houses left unsold in 2016 has created a knock-on effect this year, which has in turn lowered house prices, said Century 21 Poirier Real Estate owner/broker Tyler Poirier.
However, he points out, “It’s the best time for first-time homeowners to buy.”
Not only are house prices the lowest they’ve been in five or six years, but also “historically low interest rates” are still in play, even after a quarter per cent increase was put through by the Bank of Canada. The Bank of Canada is expected to continue raising interest rates gradually, which is another good reason to get on the first rung of the property ladder now, he points out.
“Ten years ago, people would have loved to have these interest rates,” he said.
This year, 49 houses have sold in town through Multiple Listing Services (MLS) this year, said Poirier, as compared to normal averages of 80, or as much as 90 in 2014. Sellers who have seen their houses lose value are considering options like renting, or keeping their house on the market.
However, Poirier said that if the town can get to about 70 units sold by December, following fall sales, that would be a more promising end to the year.
Normally, a house on the market will take 75 to 80 days to sell, but last year, it took an average of 127 days for houses to sell, with this year seeing a slight drop to 120 days.
“I’m hoping that gets closer to 90,” he said.
Right now, inventory on the market has swung on the pendulum to making it more of a buyer’s market, says Rollie Cartier, associate broker at Coldwell Banker Cartier Realty.
“The inventory has given the buyers a lot of choice,” he notes.
He said when checking he numbers through MLS, it appeared that St. Paul area was down seven deals from last year, with Cartier saying that he was more or less on track with his budget. Part of his sales comes from the activity with the second condominium by Lakeshore, which is drawing people from outside of the area, he noted, adding that condo is about halfway sold at this point.
There have been some brighter spots for specific realty sales, with realtors seeing movement on high-end acreages valued between $500,000 to $700,000. Land increased in value, with a high demand for large buys pushing land values about 15 to 20 per cent, according to Poirier.
Census information shows the County of St. Paul’s population increased, even while the Town of St. Paul’s population dropped. Some of those changes may be attributed to the fact that city residents are moving to the country, said Poirier.
“We’re seeing a lot of baby boomers retire to lake lots as their permanent residence,” he said, noting that this age bracket has been less affected by economic times than younger Albertans. There are some younger residents of the area who have also moved from the Town of St. Paul to the county, notes Cartier, pointing out, “They’re still here, and contributing to our economy.”
Overall though, sales activity in the County of St. Paul has also decreased, despite the increase in demand for specific properties.
This recession has been more pronounced and prolonged than the blip in the radar caused by the 2008 financial crisis, Poirier notes, but he says there are some reasons to be optimistic.
Alberta is poised to lead the country in growth, with economic forecasts showing anywhere from 2.4 per cent to 3.2 per cent increases in gross domestic product.
“We’re starting to see some positive signs of growth. The oil prices haven’t really recovered, but companies have started drilling again,” he said, noting that these companies are looking to get people back to work in the oil and gas sector.
“I think, personally, we’re going to see the St. Paul market is going to stay steady or recover in 2018.”
St. Paul has definitely come down from the busy heights of 2014, and people have definitely noticed the change, but the perception out there that the real estate market is dead is “far” from reality, said Cartier.
While he notes it’s difficult to predict the future, he said, “I’m positive, I’m confident.”
Cartier said he’s been in the real estate business for more than three decades and has seen St. Paul weather the storms each time. “St. Paul always pulls through really good.”
