Fredericton housing market recovers in May; average price sets record high but home inventory at its lowest level since the mid-1990s
The average price of homes sold in May 2020 was a record $216,347, up 3.6% from May 2019. On a year-to-date basis, the average price was $202,930 up 4.3% from the first five months of last year.
Residential sales recorded by the Real Estate Board of the Fredericton Area totaled 207 homes in May 2020. While this was still a large 40.9% decline from May 2019, it did represent an improvement over April.
On a year-to-date basis, home sales totalled 796 units over the first five months of the year, down 24% from 2019.
There were 335 new residential listings in May 2020. This was down 37.7% on a year-over-year basis; although that was significantly better than the decline of almost 60% recorded in April.
And it is interesting to note as well that with low inventory and plenty of buyers, multiple offers on homes have been frequent occurrences.
Overall supply had generally trended lower since mid-2015 but has fallen further and faster during the COVID-19 crisis. Active residential listings numbered only 804 units at the end of May, dropping 30.6%from the end of May 2019. It was the lowest level for this time of the year since the mid-1990s.
The dollar value of all home sales in May 2020 was $44.8 million, falling 38.7% from the same month in 2019.
Some of my clients have been asking me questions whether prices of houses have gone down in connection with COVID-19.
I will give you an answer based on statistics. The state of emergency was declared in New Brunswick on March 19, so analysis of effects is limited.
It is interesting to note, however, that for March and for the first three months of 2020, home sales and the average prices of homes have gone up compared to the same time, the year prior.
For the month of March, home sales totalled 180 units, according to the Real Estate Board of the Fredericton Area. This was up 2.3% (four sales) compared with March 2019 and marked a decade-high for the month.
On a year-to-date basis, home sales totalled 445 units over the first three months of the year, up 3% (13 sales) from 2019.
The average price of homes sold in March 2020 was a record of $209,883, rising 16.5% from March 2019. The more comprehensive year-to-date average price was $199,579, up 13.6% from the first three months of 2019.
The Fredericton area market remains supply starved. There were 295 new residential listings in March 2020, down 16% on a year-over-year basis.
Overall supply has generally trended lower since mid-2015 and now stands at the lowest level in nearly 15 years. Active residential listings numbered 776 units at the end of March, down 21.1% from the end of March in 2019.
Homes also sold faster. The months of inventory numbered 4.3 at the end of March 2020, down from the 5.6 months recorded at the end of March 2019 and below the long-run average of 9.2 months for the end of the year. The number of months of inventory is the number of months it would take to sell houses.
The value of all home sales in March 2020 was $37.8 million, rising 19.2% from the same month in 2019. This was also a new record for the month of March.
The full month of April will give us a better picture of market activities amid COVID-19, but so far homes have been selling at good prices this month.
In the meantime, you might have immediate concerns about the real estate market. For example, you might be wondering if you should put off moving. Or, you might need to move but are worried about all this uncertainty. If so, give me a call.
Take care and know that I’m thinking of you and wish you well.