Buyer's market remains fixed

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November 19, 2015 12:35 PM

As the economic downturn heads toward the new year, the current buyer’s market for homes in the real estate sector is taking advantage of the situation.
According to some local realtors, not only is the number of listings still slightly up, but interest rates for borrowing are exceptionally low. 
“True to all year, what we’ve been kind of seeing, our stats are still telling us that our listings are up but not all that much,” said Michael Dewing, president of the Realtors Association of Lloydminster and District. 
“Our listings are probably only up five or eight per cent.”
Sales are down around the 30 per cent mark with prices down 10 per cent, up to 15 per cent from this time last year in recent price ranges, Dewing said.
This means single family dwellings that went for $400,000 last year are now going for $360,000 to $365,000 this year. 
Given the figures, there are more advantages for the buyer right now and Dewing said there are many people taking advantage of the situation.
“It’s just that when our inventory is so high and our buyers are fewer than before, then everything sits on the market a little longer than we’re used to, which doesn’t help and of course we won’t be back into a balanced market until the local economy and the oil industry pick back up for us.”
Then there is the benefit of the very low interest rates.
Dewing said if you can get a house that’s 10 per cent cheaper than it was last year, at an interest rate that might be one per cent lower than next year, then you’re winning on both ends.
Fred Falkner, of Century 21, is seeing similar trends and describes real estate as the classic supply and demand model.
“Right now there is more supply than demand, which has driven prices down for housing,” he said.
He agreed the situation is directly related to living in the heavy oil capital of Canada, and when oil business picks up, Falkner expects a rebound in housing prices.
Neither Dewing nor Falkner could predict when the rebound will happen, however, and in the meantime people still need places to live.
When it comes to borrowing money for a home, Falkner also echoed Dewing’s sentiment on interest rates.
“If you’re looking at an interest rate right now, it’s lower than it’s ever been basically,” he said.
“For five years you can lock in somewhere around the 2.5 - 2.6 per cent (range), which is unheard of.
“It’s almost free money and if you need a place to live, now is the time to borrow, when there is lots of product to choose from and people are a little more willing to negotiate now than before.”
Falkner advises those looking to buy a house start with finding a realtor that works for them.
Have a conversation and explain what you’re looking for, be patient, and let your realtor do what they do best.

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