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Real estate ‘absolutely a buyer’s market’

Sundre’s housing market has for the past few years been slightly declining. “Prices have been coming down,” said Shelley Kohut, a local realtor.
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A couple of local realtors offered some insight on Sundre’s real estate market, which they both called a buyer’s market.

Sundre’s housing market has for the past few years been slightly declining.

“Prices have been coming down,” said Shelley Kohut, a local realtor.

However, while higher-end properties have taken a bit of a hit, Kohut added that the market for entry-level homes has actually been fairly strong.

Changes in rules to qualify for mortgages have made it harder for people to successfully apply for financing on more expensive homes. That has in turn translated to increased activity in entry-level as well as median price properties, she said.

Citing information from the Calgary Real Estate Board, Kohut said during a phone interview that there were 34 homes on the market within the Town of Sundre’s boundaries as of the end of June.

Brad Lindeburgh, a real estate agent with more than three years in Sundre, said the roughly 25-kilometre area surrounding town has 286 properties on the market, including commercial, recreational and residential.

“Could be an apartment in town, or a quarter section out of town,” said Lindeburgh, adding that over the past few months, 42 of the properties in that mix have sold.

The average turnaround from the time a house in Sundre is listed to when the property sells has been a little more than 100 days for both attached and detached homes, Kohut said, adding the average size of houses sold within Sundre in the first six months of 2019 is almost 1,400 square feet.

“It’s absolutely a buyer’s market right now,” said Lindeburgh.

Kohut agreed, adding the situation is similar throughout most of the province.

“It is a good time for buyers to get out and buy,” she said, adding interest rates are increasing and that now is an ideal opportunity to get ahead of any further hikes.

Sellers are, on average, getting shy of 95 per cent of their asking price. However, that figure needs to be quantified, she said, adding many listed prices have since going on the market been reduced multiple times.

Lindeburgh concurred, pointing out a current list price is not necessarily what the seller was originally asking for. So, citing as a fictitious example a house originally listed for $300,000 that over weeks and months was reduced multiple times down to $260,000 and finally sold for $250,000, he said the percentage changes substantially depending on whether someone is comparing the final sale price with the original listing or the several-times reduced price.

Generally, the market sells within five to 10 per cent of the listing price, but that again largely depends on what is considered the listing price, he added.

That being said, Lindeburgh told the Round Up during a phone interview that “the bottom hasn’t fallen out on prices. People aren’t yet at the state of giving away their properties.”

Overall, a combination of mortgage lows, the general economy in Alberta that still has a lengthy road to recovering to past boom periods as well as less than stellar summer weather, sales have been slower than last year, he said.

That’s not necessarily bad news for prospective buyers looking to purchase their first house, he said.

“They have a lot of options available to them. They should take the time to really shop around,” he said.

“But before they do that, they really have to make sure they have access to the financing they think they have,” he said, urging people who want to buy a home to before anything else speak with a bank or mortgage broker to determine what they can realistically afford.

Total sales on single-family detached homes in Sundre from Jan. 1 to June 30, Kohut said, amounted to almost $5.6 million. The highest sale price among those 21 transactions was $615,000, while the lowest was $120,000, with a median of $255,000.

As compared with June 30 of 2018, prices are down 4.39 per cent, which she called “a big drop” that underscores the fact it remains a buyer’s market.

Although she in the near future expects to see further declines, Kohut said she is forecasting growth in the long-term.

She anticipates that Sundre’s new cannabis production facility, which will bring in new employees, as well as the new plant north of town in Clearwater County, “should brighten up our residential rental market quite considerably and also improve the real estate market.”

Both Kohut and Lindeburgh unreservedly recommend that any homeowners seeking to sell in a buyer’s market should also reach out to an experienced realtor and price realistically.

The most important days when someone decides to sell are the first few weeks when the listing is still fresh, said Lindeburgh.

“That’s the most crucial time, when they’ll have most eyeballs on the listing,” he said, cautioning against asking for too much and promoting the property without adequate pictures to showcase the house and catch people’s attention.

“Proper pricing is key in this market,” said Kohut, adding people who attempt to sell on their own in such situations tend to, on average, lose more money than had they listed with a realtor who can negotiate.

“I’ve seen it happen many times,” she said.

“Getting the right list price off the get-go so you don’t chase the market down is crucial.”