The housing market in Cold Lake saw its worst year in over a decade in 2015 as housing prices dropped and sales stagnated.
Real estate in the Lakeland started its downward plummet in the fall of 2014, a trend that continued throughout 2015 as the economy struggled through the realities of a $45 barrel of oil or less.
“This is the worse downturn I have been through,” said Patti Ouellette, owner of the Remax Cold Lake 2000. “It was a brutal year.”
While some thought the housing market had hit rock bottom in early 2015, more people continued to put ‘for sale' signs on their lawns and added to an already crowded market as the year went on.
The increase in the number of homes for sale, combined with a weak economy, led to significant price drops right across the region.
According to Ryan Lefebvre of Coldwell Banker Home Team Realty, Cold Lake residential housing prices dropped eight per cent and sales decreased 37 per cent in 2015.
The average price of a home in Cold Lake now sits at $385,000.
“I think confidence from buyers is down and that is translating through quite a bit,” said Lefebvre. “The next couple months should be the bottom. Confidence can't get any lower than it is right now.”
Surprisingly enough, the decreases seen in Cold Lake is the first drop the local housing market has had to withstand in over a decade. The real estate market managed to squeak through the 2008 downturn relatively unscathed according to Lefebvre.
“In Cold Lake our prices didn't drop in the last crash (of the oil industry). I don't know how but we came out of that one good. From 2007 to 2008 our prices actually increased one per cent,” said Lefebvre.
“This year is actually the first decrease we have seen since 2000, so it's been 15 years.”
The number coincides with the substantial drop in the price of oil. As of Jan. 7 the cost of a barrel of oil was $33.47, which is its lowest price in 11 years.
In an attempt to stop the bleeding local banks, have dropped their interest rates and offered up more incentives to entice would-be buyers into splurging on a home.
“This is probably the best time to buy in our area in a long time. It is definitely a buyers' market,” said Lefebvre. “Prices are down. Interest rates are low. We have seen reductions on prices and some drops between the list price and what the house actually sells for.”
The number of houses available decreased a little over the winter months as people in the region started pulling their houses off the market.
“I'm thinking it could get worse. I'm hoping not,” said Ouellette. “I hope they don't drop too much more but it could happen.”
Uncertainty surrounds the real estate market heading into 2016 as realtors in Cold Lake really don't know what to expect.
Many in the region hope the housing industry has hit its bottom, but wouldn't be surprised if prices continued to plummet.
“I would expect that the first half of 2016 is slow,” said Lefebvre. “I do hope that in the later half of 2016 we start seeing an increase in activity, an increase in interest and we start going through some of our inventory.”
