INVENTORY LEVELS CONTINUE TO CLIMB
Active listings in the Saskatoon market have exceeded the 2,000 unit mark for the first time. This is significantly higher than the five year average at just over 1,500 units. At the current rate of unit sales in May, it would take just under 5 months to liquidate the current inventory. Unit sales year to date total 1,583 units which is a 15% reduction from the same period last year. The five year average for unit sales is 1,700 units for the first five months of the year. In spite of the rising inventory and declining sales, the average price remains virtually unchanged. This appears to be due to a greater decrease in unit sales in certain price ranges below $500,000. For this reason average price can be misleading and the expert advice of a REALTOR® should be sought when deciding on price. The decision where to price a home when selling, or what should be offered when buying, is the single most important decision that most of us will make and should not be taken lightly. On average it takes 45 days for a home to sell in Saskatoon which is approximately 20% longer than the average of the past 4 years
According to the Home Price Index (HPI), single family property values for single family homes are beginning to level off for most areas of the city. The HPI measures residential price trends based on four benchmark home types, with the index set at a base of 100 for January 2005. The HPI is a more accurate way to measure housing price trends than the average or median price. As summer approaches it is expected that prices will start to decrease slightly overall. This would be based on inventory levels continuing to remain high and sales decreasing slightly from the spring market activity levels as they traditionally do.
It should be kept in mind that the past couple of years have been exceptionally good years for the real estate market and today's sales levels are more reflective of the norm. The five year average for May sales in Saskatoon is 445 units which is marginally more than the 422 unit sales last month. The sales to listing ratio was at 43% which is still within balanced territory. A balanced market is considered to be when 40-60% of the homes that are listed for sale end up in a sale. In recent years this number has been closer to 50%. New construction appears to have cooled off with a significant decrease in the number of permits issued in 2015 compared to last year. As of the end of April, 268 permits were issued for Single family homes compared to 466 for the same period in 2014.
Source: June 3rd, 2015 SRAR Media Release