Fort McMurray’s housing market, once among the hottest in the province, has seen prices decline in a big way.
Since the spike brought about by an oil boom in early-2010s, when a single-family home in the northern community would cost over $700,000, the prices have dropped by hundreds of thousands of dollars, said Melanie Galea, a Fort McMurray real estate agent with RE/MAX.
“But it’s been now levelling out,” she said.
Compared to October 2022, the total residential average price in Fort McMurray went down by about 16 per cent, from about $336,000 in October 2022 to about $282,000 in October this year. The price of a single family home, which once was more than $700,000 about a decade ago is now $467,848.
Galea said she believes the price levels that the community has seen over the last few years is what’s truly normal for the region.
Galea said such market conditions are not new for her as a real estate agent, having observed a similar situation in 2015, before the 2016 wildfire.
“I would say the fire actually helped our economy here, and helped the housing industry, because sales definitely started to take off,” she said, as the community was being rebuilt.
Some condo apartments can be priced as low as $35,000, said Fort McMurray real estate agent Melanie Galea (Emilio Avalos/Radio Canada)
Today, Galea said, the hottest market in the is condo and townhouse apartments, as Fort McMurray always has a strong rental market.
“We’re seeing some prices as low as $35,000 for a condo apartment. That becomes appealing for investors.”
There are also a lot first-time home-buyers, she said.
The housing inventory in the community is steady, Galea said. “I would say right now we are in a buyer’s market.”
She said things really started to slow down when the Bank of Canada began raising interest rates last year and “buyers became a little bit more weary of the increased prices.”
Buying preferable to renting
For Kyle Wegner, 32, buying a home was preferable to renting. He’s an employee of Finning, an industrial equipment dealer that specializes in Caterpillar products, and works at one of the mine sites near Fort McMurray.
“Rent is very high here, so for me, even in the short term, it’s almost saving a little bit of money,” he said.
Wegner moved to Fort McMurray in August 2022. He bought a larger house in the community, before deciding to downsize.
“It’s just more fitting to my lifestyle and what I actually need,” he said.
A 32-year old Finning employee Kyle Wegner found buying a home preferable to renting (Emilio Avalos/Radio Canada)
His old house was still for sale when he got the keys for his new, smaller home.
He hopes not to incur a big loss on a sale of his old property.
“Our goal is to try and do our best to break even, and see how close we can get to that.”
Keeping a business alive
Suzette Nelson, an owner of flooring company Nufloors, is selling a plot on land where a three-storey townhouse the business used to rent to its employees once stood.
The townhouse burned down during the 2016 wildfire. Nelson said they wanted to rebuild the townhouse, but the 2020 spring flood destroyed Nelson’s business — and ended any rebuilding plans.
“Back in in the boom days here, accommodations were very, very difficult. Most businesses would have a place for employees,” she said. “It’s really sad to see it gone.”
Suzette Nelson, owner of Nufloors Fort McMurray, standing where a townhouse used by the business’s employees used to stand. The townhouse burned down during the Fort McMurray fire. (Emilio Avalos/Radio Canada)
The asking price for that plot of land is $75,000, Nelson said.
“We’re open to negotiations,” she said.
“We may or may not get it, but we have a bottom line that we won’t go below as well.”
TORONTO – One expert predicts Ottawa‘s changes to mortgage rules will help spur demand among potential homebuyers but says policies aimed at driving new supply are needed to address the “core issues” facing the market.
The federal government’s changes, set to come into force mid-December, include a higher price cap for insured mortgages to allow more people to qualify for a mortgage with less than a 20 per cent down payment.
The government will also expand its 30-year mortgage amortization to include first-time homebuyers buying any type of home, as well as anybody buying a newly built home.
CIBC Capital Markets deputy chief economist Benjamin Tal calls it a “significant” move likely to accelerate the recovery of the housing market, a process already underway as interest rates have begun to fall.
However, he says in a note that policymakers should aim to “prevent that from becoming too much of a good thing” through policies geared toward the supply side.
Tal says the main issue is the lack of supply available to respond to Canada’s rapidly increasing population, particularly in major cities.
This report by The Canadian Press was first published Sept. 17,2024.
OTTAWA – The Canadian Real Estate Association says the number of homes sold in August fell compared with a year ago as the market remained largely stuck in a holding pattern despite borrowing costs beginning to come down.
The association says the number of homes sold in August fell 2.1 per cent compared with the same month last year.
On a seasonally adjusted month-over-month basis, national home sales edged up 1.3 per cent from July.
CREA senior economist Shaun Cathcart says that with forecasts of lower interest rates throughout the rest of this year and into 2025, “it makes sense that prospective buyers might continue to hold off for improved affordability, especially since prices are still well behaved in most of the country.”
The national average sale price for August amounted to $649,100, a 0.1 per cent increase compared with a year earlier.
The number of newly listed properties was up 1.1 per cent month-over-month.
This report by The Canadian Press was first published Sept. 16, 2024.
MONTREAL – Two Quebec real estate brokers are facing fines and years-long suspensions for submitting bogus offers on homes to drive up prices during the COVID-19 pandemic.
Christine Girouard has been suspended for 14 years and her business partner, Jonathan Dauphinais-Fortin, has been suspended for nine years after Quebec’s authority of real estate brokerage found they used fake bids to get buyers to raise their offers.
Girouard is a well-known broker who previously starred on a Quebec reality show that follows top real estate agents in the province.
She is facing a fine of $50,000, while Dauphinais-Fortin has been fined $10,000.
The two brokers were suspended in May 2023 after La Presse published an article about their practices.
One buyer ended up paying $40,000 more than his initial offer in 2022 after Girouard and Dauphinais-Fortin concocted a second bid on the house he wanted to buy.
This report by The Canadian Press was first published Sept. 11, 2024.
