2021 has already been a huge year for real estate in Alberta and across Canada. Home prices are up substantially, and more properties are being listed than ever before.
In this article, we are going to dive into the surge of the real estate market in 2021 and how 2020 affected these increases. We also designed a nifty infographic to go demonstrate these statistics to you in an innovative way. Enjoy!
Real Estate Market Reports for Alberta and Canada
Real Estate Home Sales are Increasing Month-over-Month
Homes sales have risen nationally by 6.6% month-over-month in February meaning that even more people are beginning to sell their homes in 2021. This set an all-time record for national home sales across the country.
These stats were recorded by the CREA Residential Real Estate Report taken from the Canadian MLS System.
Many people are trying to buy homes currently, and the real estate supply is keeping up, exceeding demand.
We are seeing offers being made on homes on average of 10% higher than the asking price, and people still continuing to give more offers even after it is has reached this high. Which is incredibly astounding for the current state of the market.
Actual Activity is up 39.2% Year-over-Year
On top of this, activity is up 39.2% compared to 2020. There is a substantial amount of people looking to buy homes this year, so if you’re looking to buy a home, now is a great time to do so.
This was a new record for February with over 13,000 transactions being made in the month alone. This is the eighth month in a row that activity has been up across Canada’s housing market.
Over 700,000 sales are in the forecast for 2021. Because of this high amount of sales, it is being predicted that come spring and summer, that activity might not be able to compete with the surge of demand.
Depending on the state of the market coming in spring/summer, we may switch from a buyer’s market to a seller’s market.
The summer of 2020 saw a large increase in activity, so we may be working up towards a similar situation in 2021.
People are starting to see the benefits of a Buyer’s Market
The amount of newly listed properties rebounded by 15.7% from January to February. Showing that people are starting to act on the increased volatility of the market.
When supply is up, prices are down. Simple economics. Eventually, we won’t be in this type of market forever. It’s extremely keen to know how to navigate a buyer’s market and determine when the best time to sell or buy a property is.
One of the upsides to selling a home in this market is that you will need to find a new property to live in potentially. Putting you in the same situation as your buyers.
Carefully research your options, look at many different places to move and the properties around that area to find the best deal possible. There are still some hidden gems slipping through the cracks in Alberta especially.
Make the most out of your money and property!
Check out our 7 step guide to selling your home in a buyer’s market
Several Housing Markets are still in a Seller’s Market
Even though a majority of Canadian cities are seeing a rise in sales, there are still 8 Canadian housing markets that reported declines in their sales in February.
This is most likely due to a lack of supply. So not all Canadian markets are currently in a buyer’s market. It’s crucial to do your research and find out what type of situation each market is currently situated in.
The second half of 2020 and the first two months of 2021 saw an explosion of sales solidifying record numbers that haven’t been broken since the early 2000s (2002 to be exact) across Canada which was at an average of 55%. We are now at 85% majority of the markets reported being in seller’s territory.
This is absolutely crazy. And it may continue to stay this way as we make our way toward the spring and summer months.
Record Low Mortgage Rates
The mortgage rates in Alberta and Canada are at all-time record lows compared to previous years.
5-year variable mortgage rates are as low as 0.99% at the moment and 3-year fixed rates are as low as 1.34%. This is a major reason why many people are buying homes at the moment.
It’s a smart decision to lock down a home amidst rising prices and low mortgage rates. It’s better to act now and secure a great deal, rather than waiting out the market and potentially taking a large hit.
These findings were taken from the WOWA Residential Real Estate Report which was released on March 15th, 2021.
Real Estate Transactions are up 40% versus 2020
Amazingly, real estate transactions are up 40% versus February in 2020. People are starting to recover from the financial deficits that the pandemic has caused and are looking to buy homes again.
This great to hear, not only if you are looking to sell your home, but from an economic standpoint as well. Canada’s economy is slowly starting to regain traction across a number of industries. Let’s hope that the pandemic ends swiftly and our lives can get back to normal.
Alberta’s Real Estate Market Situation
Alberta’s housing market is increasing with average home prices rising 8.5% across the province versus February 2020.
When it comes to homes in Calgary, we are seeing prices fall by -4% versus February 2020 on average. For buyers looking to move to the city, this could be a great time to do so.
With housing prices rising in Edmonton over 8%, this shows a large opportunity for property owners looking to move their assets to the Calgary area. It’s only a matter of time till the market in Calgary rebounds and reaches new highs.
The drop in pricing for housing in Calgary has spurred lots of activity, resulting in many new buyers snatching up well-priced properties across the city.
Canada’s Real Estate Market Situation
National sales activity month-over-month has largely been headed by the Greater Toronto Area, and markets across Ontario. BC markets are also showing lots of activity as well. This has been offset by the market decline in Montreal.
Montreal’s housing market is at a much lower level than its counterparts in different provinces. New listings in 2021 versus 2020 are much lower compared to last year in Montreal.
Should I sell my home?
If you are thinking about selling your home, think carefully and research how much the homes in your area are going for and how it is taking to sell them. Our stats are telling us that buyer activity is up substantially.
Your home has the potential to sit for a while, but most people are acting quickly, scooping up properties like crazy.
You are also more likely to get higher than your asking price at this time as well, due to recent trends we are seeing around Alberta.
The MLS home pricing index was up 3.3% month-over-month and is up over 17% year-over-year.
And the national sale price is up 25% year-over-year! Even in a buyer’s market, homes are still selling at an increased price.
With real estate supply selling at such a fast rate and even more properties being posted for sale causing the market to rebound just as quickly, buyers are taking this as an opportunity to snatch up lots of properties.
People will be more likely to put an offer on your home, at a higher asking price, and at a faster rate than in past years.
Take a look at our article on increasing your property value by learning about curb appeal
Should I Buy a Home?
Now is the time to buy a home before we enter back into a seller’s market. We can only predict when this will happen.
It’s time to act and find a property for you or your family in Alberta. You must navigate the market carefully, but you will have lots of choices to pick from.
Prices are currently up over 14.9% in Ottawa, compared to 3.5% in Calgary. Meaning, you will not be paying at a higher premium than other provinces at the moment. BC, for example, is seeing increases of around 10% in Chilliwack and Vancouver Island.
If you are thinking about buying a rental property, it could be a good time to do so. By taking advantage of the current market, you can find many beautiful properties and rent them out straight away.
Getting Ready for the Spring and Summer Markets
We are heading into one of the largest surges in real estate demand that Canada has ever seen.
In order to properly prepare for the storm, we need to make sure we are making the right decisions at the right time.
If you are looking to sell your property, it’s keen to remember that there is a large demand-supply imbalance currently. And it’s only going to get more volatile as 2021 goes on.
Canadians are looking for properties because of low mortgage rates, but how much are they truly saving if the price of homes goes up even more dramatically come April and May?
There is a small margin for error in the market right now. It’s important to talk to a qualified real estate agent that knows the current state of the market and how to approach it.
While it may be a buyer’s market in Calgary and Alberta, the rest of the provinces in Canada are showing significant trends towards seller’s markets.
With mortgage rates being lower than ever, people are buying up properties at increased rates. MLS listings have shown us that even with this surge of people buying, that many people are still listing their homes for sale as well.
Housing prices are down in Calgary, and up in Edmonton. From our own experience, we are seeing suburbs around Calgary (such as Airdrie) getting housing offers for over 10% of their listed price.
The market is extremely volatile at the moment, and people are rushing to get in on the action. There hasn’t been this much activity since as far back as 2002, with a major demand-supply shortage across Canada.
If you would like more information on how to approach the market and make the most of it, contact Derek Timmons today to see what we can do for you.
Derek is a top-seller for CIR Realty and is knowledgeable about the current state of the market and how to navigate it. For more information check out out our homepage or browse our current listings in Airdrie that we have available.
Categorised in: Real Estate
This post was written by Derek Timmons