Slower home sales continue in 2023.
We’ve made it through February 2023 and home sales are lower for the second month of the year. We are expecting slower home sales in 2023 with interest rates being higher but what impact will it have overall?
When comparing the number of homes sold each month I compare them to the same month a year earlier. Comparing them to the month before doesn’t give us a good idea of how things are changing because the start of the year generally sees home sales increase and the opposite happens through the end of the year.
More homes sold in Red Deer in February but like I said above that’s to be expected. 59 detached homes sold this January, which is 48% lower than in February. This is a large nose dive because January’s sales of detached homes were only 37% lower.
Comparing this February with last February looks pretty tragic but it’s equal to the number of detached homes that sold in February 2020. We have to remember that home sales in 2021 and 2022 were higher than normal with interest rates being super low.
Attached home sales were interesting to track last year because as detached home sales slowed attached home sales increased. It’s obvious that, as interest rates climbed the purchase amount buyers were qualified at shrunk. At the same time, detached home prices were also climbing. Both of these variables caused a higher number of homes to sell in a lower price range.
Attached home sales were up for 12 months in a row through the end of 2021 and most of 2022. However, in December 2022 that trend stopped with attached home sales dropping 51%. Wow, what happened so quickly?
It was definite that all home sales would slow with interest rates increasing and if it was going to show, December would be the month. Home sales are generally much slower in December.
The shock of December’s attached home sale drop was lessened when January sales were only down 4.6%. It takes a few months to confirm a sales trend but we might be getting an early warning with attached home sales down 41% in February. With all home sales so much higher in 2022 we’ll likely see some big drops through 2023
Overall home sales in Red Deer
Overall we saw more homes sell in 2022 than in 2021 but only because attached home sales did so well. In January 2023 total home sales were 26% lower but in February total home sales were down 45%. We might see total numbers similar to 2020 in the Red Deer real estate market this year. But I think with more people buying less expensive homes this year, we might see slightly higher sale than 2020.
Check-in at iOnRealEstate.ca often to keep your finger on the pulse of the Red Deer and Central Alberta real estate market.
Hosted by Blake King Realtor® and Big Earth Realty. Blake continually monitors the Red Deer and Central Alberta real estate market to track changes and watch trends so he can help his clients make the most informed decisions, buying or selling. If you want to learn more about how local market stats impact your next real estate transaction call or message Blake anytime (403) 350-7672 or email@example.com