The first quarter of 2010 has come and gone. The local real estate market continued its healthy performance that started to gain momentum in the fourth quarter of 2009. The five factors that affect our real estate market are supply, demand, prices, interest rates and consumer confidence.Data from the first quarter show us that supply remains fairly tight.Demand remains unabated. Prices softened. Interest rates have begun their march upwards and consumer confidence is steadily improving. Here is a closer look.
There are currently 130 homes on the market in and around Dawson Creek. The most noticeable activity was at the very bottom of the market where there are currently 15 listings under $100,000 compared with four at the beginning of the quarter. With a 50 per cent sales to listings ratio between $101,000-$150,000 the segment has rebounded dramatically from being the weakest in the market (29 per cent)in the previous quarter. At other end of the spectrum there are currently nine homes priced between $350,000 and $400,000 and nine more between $400,000 and $450,000. The most competitive market segment continues to be $201,000 to $250,000 with 28 current listings.With spring right around the corner and strong activity levels, expect a surge in new listings to hit the market in the next quarter
Demand for local property continues to accelerate as activity levels break records. Fifty-three sales made this the strongest first quarter ever by volume.Notably on the down side, rural properties were very slow moving with only four sales for seven per cent of the market following up the third and fourth quarters of 2009 where rural properties made up 17 per cent of the market. These things tend to be cyclical-watch for an increase in rural sales as spring time makes these properties shine. Also notable is the observation that locals are warming up the idea of Condo living. Sales of non-adult oriented attached strata properties (Six sales with eight more pending) made up more of the market than at any other point in history.The local market appears to be embracing unfamiliar housing options as it evolves.
In spite of this increased activity, prices softened to their lowest point since the fourth quarter of 2008 to a $192,000 median. This was largely due to the surge in sales at the bottom of the market and chill in activity near the top. However, this kind of quarterly dip is not unusual in this part of the world. Encouragingly, prices remain within the range reached in 2007 where prices have been hovering between $185,000 and $222,500 ever since. Seven pending sales over $350,000 point to a price rebound in the second quarter as we usually see after a dip.
Interest rates are probably the hottest topic when it comes to Canadian real estate at this time. Most banks recently increased their 3/4/5-year fixed posted rates in the past week. This move made headline news and caused consumers to scramble to lock in their pre-approved rates and variable rate mortgages. Regardless, actual rates being offered to consumers remain at all-time lows. New mortgage rules that come into effect this April were announced last quarter and have led to a bit of a surge in activity nationally. It is difficult to gauge if they have had a direct effect on the local market, but they sure are a hot topic of conversation!
Consumer confidence appears to be healthy. The community is buzzing as activity in the energy sector continues to accelerate. Recent announcements by EnCana, particularly the company's plan to double activity in the region over the next five years and the development of lucrative new markets though a $1.1 billion partnership with the Korea Gas Co. are positive. The Site C dam, though it remains unannounced, continues to fuel speculation of a potential land rush in our town.
In summary, the first quarter of 2010 was a good one for Dawson Creek real estate. Continued strength in the local economy should lead to the same in the real estate market. That said, rising interest rates this quarter could either put a chill on the market as people are priced out, or it could accelerate the market further as people rush the take advantage of the rate sale that is coming to an end. Data from the first quarter show us that supply remains fairly tight.Demand continues to strengthen. Prices softened but remain within the levels established in late 2007 when the market plateaued. Interest rates have begun their march upwards and consumer confidence is improving. This should bode well for Dawson Creek real estate going forward.
Kevin Kurjata is a Dawson Creek Real Estate Specialist with Remax Dawson Creek Realty. Go to www.kevink.ca/dawsoncreekmarketpeek.ubr for more information on the current state of the Dawson Creek market. He can be reached at 250.719.3538 or at email@example.com. He is currently accepting new clients.