Why the COVID-19 Pandemic of 2020 has been the Roaring Twenties of the Red Deer Real Estate Market~
Amidst COVID-19 the Red Deer real estate market has handled rather well. Nobody’s expectations were incredibly optimistic for a market that relied on the exchange and interest in such personal belongings- Our homes.
A portion of the community thought the market could crash and burn, but that’s often the general, and easy prediction when there’s uncertainty in the future of a market. We’ve learned one thing through the years as our market has faced an array of shifts; it’s that our economy is more diverse and more resilient than most of us realize.
It’s surprising to look back and see 9 of the first 11 months of this year had higher home sales than 2019, especially considering one of the lower months was prior to COVID-19. Overall, home sales are still down -1.3% in 2020 but only because the two most impactful months at the start of the pandemic, April and May, were very low. However, being only -1.3% is reasonable considering the economic impact the pandemic has had.
Similar to the number of home sales, the average home sale price dipped at the start of the pandemic. Buyers understandably questioned whether a move was what they wanted. But, over the last few months prices have been above average. April and May saw prices recede but each month since- sales have done well.
Month to month average home sale prices can vary to a reasonable degree, but when we look at the 4-month and 12-month running averages, home prices are proving well with little retrogress.
Why have home prices done well this year?
What influences home prices more than anything else is a market’s inventory levels. Sales were up in part due to low-interest rates and the number of listings through COVID-19 have been lower than usual. Many homeowners decided to sit tight and safe, keeping their homes off the market through a pandemic and the low inventory along with high sales continuously puts positive pressure on prices and gives the market a healthy appearance.
The COVID-19 pandemic has impacted many aspects of our lives and community, but its encounter with the real estate in Red Deer and Central Alberta displays an interestingly healthy seeming market- One we haven’t seen in years.