After starting the year with a record low number of homes for sale in Lethbridge, owner of Re/Max Lethbridge says the market is changing. Dallas Harty says the increase in borrowing cost is one factor leading to a more balanced market.
“Over the past few months here, we have had more inventory come on so we are back to some levels where there’s just not as much pressure,” he says. “Quite frankly it’s a good thing. The best real estate markets are the ones that are operating balanced,” he says.
About four months ago, the city’s housing market was as tight as it has ever been, with an inventory in the low hundreds. “That was really difficult, there were too many buyers looking at very few options. Now we have put on hundreds more listings and so if you are a buyer, there is not nearly as much panic,” Harty says.
He adds the increased interest rates also affect sellers, because there are fewer buyers in the pool. Re/Max has seen a decrease in the number of transactions for three months in a row and Harty says the average home price is still increasing slowly.
According to the Canadian Real Estate Association’s website, the median sale price for a single detached home rose 11.6 per cent on a year over year basis in the second quarter of this year. It says the median sits at $350,000 in Lethbridge.
“Even though things are changing, it actually still is a seller’s market and they are still getting a very good return on selling their home if they purchased it five years ago even,” Harty says. He adds the increase in inventory is one reason people are looking to sell right now. With the market beginning to balance, homeowners have options to buy again and relocate after selling their homes, Harty says.
Re/Max Lethbridge shows 648 listings in Lethbridge as of July 25, with an average price of $381,352. Of these, 401 are detached homes.
“We always feel very fortunate in southern Alberta that when there’s increases, we probably don’t have as sharp of increases as some other places, but that also works the other way,” Harty says. “When things are softening up, we also don’t see the big downward swing.”
The city’s stable economy contributes to the stability in the housing market, according to Harty. He adds though it is still a seller’s market, it is getting closer to balanced and he anticipates the trend to continue in the coming months.