Star Phoenix, March 15, 2016 - Saskatoon real estate prices continued to fall off slightly in February. The city’s composite home price index fell 2.96 per cent over the last 12 months to $301,600, according to a new report from the Canadian Real Estate Association (CREA).
“I think it’s much like it was last year, where we’re coming into the spring market with a great deal of inventory — in fact, more than we had last year — and slightly softened demand,” said Norm Fisher, a veteran real estate agent and owner-broker at Royal LePage Vidorra.
On an adjusted basis, residential sales in Saskatoon fell 2.3 per cent compared to February 2015, while sales dollar volume dropped 10.2 per cent, CREA reported Tuesday. These declines pushed the home price index — which eliminates the effect of monthly fluctuations — down half a percentage point from January, CREA data shows.
Fisher said that while there are significant variations among different housing types and neighbourhoods — for example, single-family homes in the $350,000 “sweet spot” can still attract strong interest — the city’s real estate market has shifted to favour buyers.
That cycle is reflected in CREA’s forecasts for 2016 and 2017, which predict a turnaround in the province’s real estate market.
According to CREA, Saskatchewan’s average sale price fell 0.5 per cent, to $296,983, in 2015 and is expected to decline 2.4 per cent this year before growing by 0.4 per cent, to $291,200, in 2017. Sales activity is also expected to rebound, climbing two per cent in 2017 after a 3.7 per cent slide this year.
CREA chief economist Gregory Klump explained the provincial forecast in terms of weak resource prices causing a “chill” in consumer confidence. He said flagging confidence is expected to keep buyers on the sidelines until the “green shoot” stories start emerging.
“At that point, what we anticipate is that the worst will be behind us and that the economic prospects going forward will improve — and the news will reflect that, and that will provide warmth to consumer confidence,” Klump said, noting that while CREA makes predictions on a provincial basis, markets are always local.