“The world is not ending out here, but it is correcting itself and, depending on how long the prices stay where they are and how low they go, there will be a ripple,” says Duane Ritter, an agent in nearby Edmonton. “We just don’t know how big the ripple is going to be.”
Fort McMurray, where much of the province's oil production is based, saw sales plunge 64.7 per cent year-over-year in the month of February, largely on fewer duplex and single-detached home sales. Indeed, George Bamber, a broker and owner in Calgary, said the high-end market would likely feel the pinch more so than those in lower price ranges. Condos and townhouses in Fort McMurray reported just four and five fewer transactions than the year-ago period, respectively, though statistically those each represent a 50 per cent decline.
“If you look at statistics … (sales) are down, but you have to look at where they’re down," Bamber said. "Interest rates are at all-time lows, banks are competing for business.”
Further, average prices across the region actually rose in February – up 1.4 per cent. That gain was largely realized in the condo market, where a 12.64 per cent increase in average price offset a 5.51 percent dip in detached prices.
Similarly, Calgary reported a staggering 34 per cent drop in home sales last month, though housing prices dipped just 1.15 per cent. Ritter says many sellers aren't desperate to offload properties, accounting for the fewer sales but largely untouched prices.
"The prices are what they always have been,” Ritter says. “[Residents] are saying, ‘If I can sell it I’ll sell it’. But they’re not going to be the lowest guy on the block. There’s a steady market.”
The latest sales data coming out of Fort McMurray might be shocking, but to those veteran agents who have been farming oil-producing regions for decades, it's nothing new.