Sales dropped on a year over year basis in August in Edmonton for the first time since April 2011. 1516* homes sold through the MLS® system in August, down from 1602 last August and 1731 last month. Is this the start of a trend or just a one month blip?
We will only know the answer for certain in a few months, but the real estate market as we all know is cyclical, and after 11 months of being in “Phase 1″ of the cycle we could be moving into Phase 2 or 3. If, in fact, that is the case, we will start to see prices coming down on a year over year basis in the near future. Of course, the length of time it will take to move through the cycle and come back around to Phase 1 is anyone’s guess – my guess is that it won’t take too long (spring market?).
The average MLS® sale price in August was $334,395, up from $324k last August and down from $336k last month. The median sale price was $320k, up from $315k last August and down from $325K in July.
The REALTORS® Association of Edmonton pointed out an interesting trend in their official release today:
Average prices are affected by the difference in price of similar properties as well as the market composition or mix of homes sold. Compared to a year ago, a typical bungalow in August sold for 2.2% more while a typical 2-story home sold for about 3.2% more. While the price of an individual home was rising, the market composition was also changing. In August 2012, 53% of SFDs sold were priced below $375,000 as compared to 59% in 2011. In addition, the number of sales of homes over $500,000 was up from 11% in 2011 to almost 15% this year.
“August sales illustrate the changes in the composition of the market,” said Association President Doug Singleton. “More consumers are purchasing homes at the higher end of the market. This is an indicator of consumer confidence and a long term view that this market is stable. ”
The inventory of homes on the market dropped slightly to 7,458 properties from 7,684 in July.
*We adjust the residential sales total for the current month to account for unreported sales. Every month 6% of sales on average are not reported to the Association in time for the monthly report. The following month the numbers are updated to reflect the total sales during the previous month. That means the current month always looks worse compared to previous month. Our adjusted numbers are far closer to the actual numbers than those reported by the Association each month (so far on average I am under reporting by 22 sales whereas the association is under reporting by 107 sales each month).