Please note that the association’s comments often touch on “year-to-date” numbers, and some of their comments may address sales within the association’s full trading area. The charts that you see on these posts , as always, reflect data for activity within the city if Saskatoon on a month-to-month basis over the past five years.
August represented the eighth straight month with a year-over-year reduction in the number of home sales in Saskatoon (Norm's note: This statement is actually incorrect. In July of 2015, residential unit sales exceeded those recorded for the same month of the previous year breaking a six-month run of annual declines). This, coupled with a continued elevation in inventory levels equates to a buyer's market. Currently there are just over 2,000 residential listings on the market in Saskatoon, an increase of 26 percent from just 12 months ago.
Considering that there were 329 sales in August, it would take six months to liquidate the current inventory of homes. Year-to-date in 2015, 2,812 homes have changed hands, a 12 percent reduction from last year. The sales to active listing ratio (percentage of listings that are actually selling) for August was 39 percent, significantly lower than the five-year average of 54 percent. This suggests that only four out of every ten homes placed on the market will result in a sale. Meanwhile the average home required 50 days to sell compared to the five-year average of 41 days. Roughly 690 of the active listings are condominiums with two thirds of these being apartment style. "The reality is that our market is feeling the effects of slower economic times," comments Jason Yochim, CEO of the Saskatoon Region Association of REALTORS®. "If someone is serious about selling their home they need to sharpen their pencil regarding price to ensure a successful sale." he adds.
The number of sales are down in nearly every price range but most notably between $450,000 and $500,000 and $750,000 and $900,000. This reduction has also impacted the new home market where the number of housing starts are down significantly over 2014. Year-to-date, single family housing starts for the Saskatoon area totalled 510 representing a 28 percent reduction from 2014 while multi-family starts increased by ten percent to 798 units. The average home price continues to remain static at $357,000. The Home Price Index benchmark price of $327,700 remains virtually unchanged from a year ago for a single family home. The Home Price Index has remained fairly flat for Saskatoon indicating that prices are remaining stable for the time being. Over time this is likely to decline slightly as new listings continue to outpace total sales.
Ultimately sale price is determined by what the current market will bear, specifically what a buyer will pay, not necessarily what the seller wants. Buyers are more educated today than at any other time with access to information on the web and are unlikely to pay more than market price with more to choose from. "It's important to keep in mind that regardless of the market conditions homes still sell, provided they are properly priced to the market." comments Yochim.
According to the second quarter RBC Housing Trends and Affordability measure, it takes a household income of $72,300 to purchase a detached bungalow in Saskatchewan. The next closest province is Manitoba at $68,100, Quebec at $54,700 and the Atlantic provinces at $50,900.
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