Regina's housing market is picking up speed, says a new report by Re/Max, and the expectation is that the number of homes sold by the end of the year will match 2008 levels.
Re/Max said that even though year-to-date multiple listing service (MLS) sales for Regina and area were down 10 per cent from 2008 -- from 1,977 to 1,778 units -- the gap narrowed throughout the past two months. During May, the number of homes sold was 387 units, up 8.7 per cent from last year. In June, there were another 387 sales -- a 24-per-cent increase from 2008.
Rob Nisbett, co-broker and co-owner of Re/Max Crown Real Estate in Regina, said sales just inside Regina are only down one per cent this year, and the increase in demand is a result of job creation in the province and Regina. He said it took people awhile to realize that the economic situation isn't as bad as what they may have been told, and buyers are now getting into the housing market.
"As consumer confidence is coming back, people are spending money, people are needing more staff, there's expansion in businesses, (and) there's a thrust in employment," he said. "We're having ex-pats come back to Regina as new jobs are posted ... I'd have to think that now we have stopped any negative out-migration and it's all in-migration."
During the first six months of the year, the most active segment of the market was homes under $275,000, which was driven by first-time buyers. Homes sold for between $400,000 and $450,000 also experienced more activity, as sales increased about 25 per cent compared to the same period last year.
"When somebody sells their house for $250,000, their next house is most probably that $375,000 to $475,000 (range)," said Nisbett. "That has leap-frogged, so that's why you have those two price ranges that have shown magnificent increases in demand."
The high demand for homes in these price ranges has also caused average prices to increase, said Nisbett. The year-to-date average price of a home inside Regina was up four per cent from the first six months of 2008.
However, with an oversupply of units listed in the market, Re/Max reported that sales of condominiums have softened. Nisbett said most condo buyers made their purchases in 2007 and 2008 and it's now a matter of waiting for the next round of buyers to come to the market.
The Re/Max report also indicated that Regina's housing market is transitioning into a balanced market that would favour neither the buyer nor the seller. The transition began in May and June when the high level of transactions took a lot of the inventory out of the market, Nisbett said.
"Our housing market is, number one, a safe market -- a good investment," he said. "Secondly, I believe that we're going to have a continued increase in average price in Regina and I think the economic growth of Saskatchewan and Regina is almost guaranteed."
Nationally, Re/Max reported that pent-up demand boosted sales of residential homes in major Canadian markets -- an indication of a recovering housing sector. Toronto and Vancouver led the country in June sales, with 10,955 units and 4,259 units, respectively -- both just short of breaking records.
The market conditions are more balanced and sales throughout the remainder of the year in most centres are expected to either be on par or ahead of sales in 2008, said Re/Max.
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