Fort McMurray hits lowest home inventory in 13 years
'We may very well be here for 10 more years, because we can't afford to sell'
The lowest housing inventory in Fort McMurray in 13 years is a sign the market is stabilizing and that the plummeting home values of the last decade may be coming to an end, real estate agents say.
"Homeowners have suffered greatly," said Tom Albrecht, an agent with RE/MAX First in Fort McMurray and Calgary. "People either can't or won't sell."
For many people the value of their home is less than their mortgage, forcing potential sellers to keep their property off the market, he said.
Others are holding off on selling, because they're optimistic that prices will go back up.
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Albrecht said he has a list of a few hundred people who looked into selling their homes in the last six years, who wanted to sell their homes but changed their minds after an evaluation.
"The big picture story is that we had high sales [in 2014] and now we have low sales. It has not recovered."
'Sick to your stomach'
Katherine Barbour bought a three-bedroom home in 2014 for $610,000. Her most recent valuation was $433,000.
"It feels like sick to your stomach," Barbour said.
At some point she would like to get a bigger home to make room for her growing family, but she would need the market to turn around, she said.
"We may very well be here for 10 more years, because we can't afford to sell."
Barbour and her husband also own a mobile home, which they've tried selling on three occasions, but weren't able to without losing money.
38 per cent drop in listings
In October 2019, Fort McMurray had 628 active listings, but only 388 last month, a drop of 38 per cent over 12 months.
Melanie Galea, a real estate agent with Re/Max, said there are a few reasons for the lowered inventory: it's winter and there are fewer bankruptcies on the market because the courts have limited capacity during COVID-19.
She's also spoken to many clients who can't afford to sell because their home valuation is so low.
"It's a common conversation," Galea said. But "there's no trying in this market. Buyers are not overpaying."
In 2014 the average single-family home sold for $737,000. In 2020, the average home is selling for $501,000.
Ann-Marie Lurie, chief economist for the Alberta Real Estate Association, said the low inventory is good news for Fort McMurray's struggling housing market.
"That's going to support some at least modest improvement for prices if that continues," Lurie said.
"This market has struggled with too much supply relative to the demand for quite some time."