Conditions Getting Tighter in Fort McMurray Real Estate Market

More than halfway through an unprecedented time in real estate history, markets across Canada are still experiencing the surge caused by the pandemic. Demand is still high, and while inventories are increasing, it isn’t enough to offset the high numbers of those looking to buy. While some may have found the pandemic related lifestyle changes to be monetarily challenging, others have been able to save a significant sum of money thanks to the inaccessibility of many leisure, recreational and entertainment outlets amid repeated lockdowns. In fact, 15% of Canadians reported they were able to grow their savings since the pandemic first hit Canada. These Canadians also report that they plan to use these funds as a down payment on a home within the next year. This information further supports the notion that Canadians are looking to buy – even if the markets from coast to coast remain in red hot sellers’ territory, posting record-breaking prices. Even local markets that showed signs of struggling in the first few months of the public health crisis, have made triumphant recoveries; the Fort McMurray real estate market is a prime example of this.

Fort McMurray Housing Market Staying Strong

Sitting in the northeast of Alberta, Fort McMurray is located in the middle of the Athabasca oil sands. A city that typically pulls workers from across Canada, Fort McMurray real estate has been in a boom over the last year.

While the Fort McMurray figures posted for the the month of May didn’t quite hold up to the numbers posted in April, average home prices increased yet again – something that could be linked to supply levels struggling to keep pace with demand. The month recorded 408 units of inventory which is the lowest for the month of May since 2007. With a small number of homes being added to the market, the sales-to-new-listings ratio was relatively high at 70%. These two quantitative measures help support the increase in pricing seen during the month, where 18% of the homes sold were priced over $600,000; much greater than May 2020 where only 12% of homes sold were priced over $600,000.

These trends progressed into June, with the exception of new listings. The month of June saw gains in new listings to the tune of a 16.9% increase when compared to June 2020. These new listings have supported the sellers’ market, but also allowed for prospective buyers to have a larger selection.

In terms of new homes on the market, 136 detached residential homes, 18 apartments, 16 row houses, and 10 semi-detached homes were listed across the Fort McMurray housing market. This represents a staggering 67% increase in new semi-detached listings year-over-year compared to last June, but a shocking 45% decrease in apartments over the same period.

Sales in the city were up 19% this past month compared to last June – a number heavily driven by the 200% increase in semi-detached home sales. Detached residential home sales were up 34%, apartment sales increased 26%, but row house sales decreased by 60% – further supporting the notion that buyers are looking for more greenspace and living space in the wake of the pandemic.

With the surge of new listings on the market in June, average prices for Fort McMurray properties managed to cool off a little. Specifically, average detached home prices were down almost 10.6% month-over-month when comparing May 2021 with June 2021. Similarly, the average price of a row house decreased by 10.2% and the average price of an apartment sold during June decreased 8.6% compared to those sold in May 2021. Contrarily, perhaps due to the large increase in demand and inadequate supply of semi-detached homes, the average price increased almost 3.5% from May 2021 to June 2021.

What’s in Store for Fort McMurray Real Estate?

With new listings beginning to pick up, this is a sign that the local Fort McMurray real estate market could eventually be cooling off a little and swinging closer to neutral territory. This will however be dependent upon a consistent increase in new listings and a decrease in demand over the next few months. With many property types seeing a decrease in average prices, it is expected that buyers will continue to jump into this still relatively affordable market and put their pandemic savings towards a new property.

 Sources:

RE/MAX Canada Blog
Alberta Real Estate Association