2020 Real Estate Predictions

What will the real estate market be like in 2020? That is a huge question that is of course like every year – pure speculation. However, we can speculate with looking at the past history trends and patterns to give us an idea of where the market is heading…potentially.

We know that in Alberta we have been hit hard with different governments, failing economy, job losses, and federal mortgage rule changes which have all effected our housing market negatively. The past 4 years our market has seen not only a small decline but in most cases families who have purchased homes 5-8 years ago, some 10 years ago, are now losing money and have seen all their equity in their home disappear. Real estate has always been a long term investment, however the value of real estate has been beyond disappointing for most.

All of these factors have driven the average price of homes down because of the lack of buying power (lack of equity in turn lack of downpayment, lower wages, mortgage rule changes = lower mortgage qualifying amounts), demand is lower therefore driving sale prices down because less people are purchasing. So there are a lot of factors that have driven prices down the past 4 years.

But the question is what will happen this coming year in 2020?

Well if you take a look at the market, the average price point of homes in certain areas has declined less but in the suburban areas (outside of the Anthony Henday) they have seen the biggest hits over the last 4 years, even the last year. New builds compete against resales causing limitations in the resales to be lower priced because builders keep enticing buyers with more incentives, newer homes, and more upgrades for less money.

I’ve looked at the real estate history over the past 20 years and the declines seem to come in 4-5 year cycles. All things that I listed above and the sense of consumer confidence – I believe our market will slowly make the recovery this year. Last year I thought we’d flat line and I was incorrect (because no one has a crystal ball and I was hopeful). This coming year we have no elections, just a “regular” year, whatever that means ?

My prediction is that we will see a slight improvement by the 3rd quarter with a decline again for the 4th quarter as that is a typical seasonal trend. But by slight improvement I mean that in Spring and Summer we will have more sales, not necessarily higher prices but your odds of selling will increase and the prices will stay consistent. Maybe next year we can entertain thoughts of prices increasing again.

This is purely my personal opinion. You will see a lot of different perspectives from the media, etc. stating conservative and optimistic thoughts. But today I wanted to share my thoughts and also have record of it so next year we can see if it became reality or not!

Regardless of what I THINK 2020 will do, I do know this, if you are looking to buy or sell in 2020 you need to sit down with a professional to get a look at your own unique situation.

There may be a better time to sell or not sell, buy or not buy, depending on your own specific situation. I am happy to sit down and have that conversation with you. We want to be ready as a seller – the best time to sell may be March-May, and that is literally coming around the corner! We may need to prep your home to sell. As a buyer, the next few months will be critical to get you into one of the best deals, low rates, and we know that prices are low.

Send me an email at melody@relife.ca or call me at 780-945-7821.Thanks for reading!

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