Economic struggle expected to create solid buyer's market

downturnthumb2After 24 years in real estate, Iris Talbot looks back on the many highs and lows in Calgary's market. This hasn't been the first rodeo for her in times of economic struggle, but the experience doesn't make the downturn easier. Although some realtors are optimistic about the market, Talbot reminds Calgarians to stay vigilant on what she understands to be a current buyer's market.

"What I see happening in this market is that we have more listings. There's greater uncertainty, people are being laid off, and overall, you have many different kinds of people in the market right now," says Talbot.

Last year, many houses took only a week to sell at what Talbot describes as high but reasonable prices. She remembers, though, that some clients faced higher risk when they sold houses in order to buy. She says a year later, some houses are still selling fast, but the rates have dropped dramatically, with last month's total sales dropping over 38 per cent, according to statistics published by the Calgary Real Estate Board.

 To add, the overall median market price stands at just over $450,000 compared to last year's peak of $475, 000, but February retail forecasts predict these numbers are to go down again.

Talbot says the realistic price for houses right now is anybody's guess. When people are unsure in an extremely quick market, she has seen decisions made rashly or not at all. Some clients aren't willing to drop prices, and the resulting value of the house starts to decline. This hesitation has proven to make quick house sales difficult.

"Like any market, if you're buying and selling, you have to deal with the reality of the market. It's kind of a hard thing. If everybody who's a game player in the province is talking about the lack of funds, of course it's going to affect the market," says Talbot.Iris TalbotRemax Central realtor Iris Talbot predicts a great buyers market, as long as buyers are watchful.

Photo by Nicholas Aviles

Talbot has been surprised by one thing during the drop in the retail market. Despite the weakening economy, rental rates have stayed relatively the same, with some instances showing increases. With that in mind, many clients have chosen to buy a house as a means of escaping the current rent cycle.

 "There's risk if you buy a house, but there's also risk if you don't buy a house. I have clients who are asking why they have to rent when they could afford to buy a house for the same amount that they're paying in rent," says Talbot.

Still, she concludes that it all comes down to whether Calgarians interested in the market have a secure job. Even so, Talbot wants clients to know that the best option here is awareness.

She says real estate can change overnight, so if Calgarians keep their eyes open, there's no telling what doors will open for buyers.

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Read this Calgary Journal special report for an in-depth comparison between Jim Prentice's response to the current drop in oil prices and Don Getty's response in the 1980s.