When Canada first sounded the alarm on COVID-19 and entered lockdown, individual provinces upped regional measures to protect citizens. Some could continue going into their workplace if deemed essential, while others worked from home. Others still were let go from their jobs due to financial strain in certain industries. Higher unemployment means decreased financial stability – meaning many people across Canada were not looking to purchase a home. In Red Deer, Alberta, specifically, the unemployment rate one year ago in June 2020 was an astonishing 13.6 per cent. Luckily, as time passed and case counts dropped, restrictions eased and employment numbers in the moderately-sized Alberta city have shot back up; which has been welcome news for the Red Deer real estate market.
As of the start of July 2021, the employment rate in Red Deer has remained stable for two straight months at 10.2 per cent. Due to a rise in employment of 1,200, the unemployment rate in Red Deer has dropped by 3.4 per cent year-over-year, and according to the most recent figures, more residents have confidently returned to the housing market.
Red Deer Housing Market Remains Strong
For the first half of 2021, the Red Deer housing market has been strong. The shrinking unemployment rates in the city have been a big driving force behind this fact. After a solid spring season, sales activities have slightly trended downward in July. The month saw 153 unit sales, putting July 2021 in line with the five and ten-year averages for the month. Leading the charge in unit sales, were detached homes coming in at 108 units moving off the market. Semi-detached homes and apartments saw the biggest year-over-year sales increase with 27-per-cent and 30-per-cent increases, respectively.
There is no doubt that the real estate market in 2021 has been far stronger than that of 2020. Cumulative year-to-date unit sales for Red Deer in 2021 has hit 1,196 units – a 79-per-cent increase over the first seven months of 2020.
New listings on the market for the month of July worked with the unit sales to allow the months of supply to rise above four months for the first time since January of this year – indicating that Red Deer may be heading towards a more balanced market. With 669 units in inventory at the end of July, there is a chance the market could cool and month-over-month price increases could begin to slow. Strong sales and a competitive market have led to the year-to-date average price in the city rising by nine per cent when compared to this time last year.
What to Expect in Red Deer Real Estate
As the year progresses, vaccination rates increase, and restrictions continue to ease, it is expected that the unemployment levels in Red Deer and across Alberta will remain stable, which will bode well for residents on an individual basis, and the local economy as a whole. Heading into the second half of the year, home sales should remain strong, and as long as inventories don’t drastically dip, property prices in Red Deer should remain at a fairly consistent slow increase month-over-month.
In order for any drastic change to occur on the price front, the local market needs a consistent influx of newly listed homes each month. Should the last half the year remain strong with ample inventory and new listings, prospective buyers can anticipate the Red Deer market to cool by the first few months of 2022.