📍 Welcome to the first episode of Brick by Brick in 2025! I’m Roxann Klepper, and I’m thrilled to kick off this year with you. Today, we’ll take a walk down memory lane to unpack the highlights, surprises, and lessons of 2024—the year that kept us all on our toes in real estate. But, we won’t stop there. Stick around as I dust off my crystal ball and dive into bold predictions for 2025, from market trends to insider tips.
2024 Market Recap
Let’s start with a quick recap. Using Red Deer as our benchmark, 2024 saw a slight dip in sales volume compared to 2023, with a total of 1,822 residential properties sold—about 22 fewer than the previous year. However, this number is up significantly from 2019 when only 1,294 properties were sold.
Here’s a breakdown of what happened: when sales drop, it’s often because of two scenarios. The first is a buyer’s market—high supply, low demand—which usually drives prices down. The second scenario, which we’re experiencing now, is low supply and high demand, which leads to fewer sales due to limited inventory.
Many wonder if this means a market crash is coming, but let me set the record straight: the only way we’d see a crash in Alberta is if hundreds of thousands of people leave the province in a short span of time, leaving vacant homes everywhere. That’s not happening. Alberta’s economy is strong, and barring any drastic shifts in supply or demand, a market crash is unlikely for the foreseeable future.
Sales and Price Trends
In 2024, the average sales price across most of our markets rose by 10% or more. In cities like Calgary and Edmonton, the increase was even higher, around 20%, due to interprovincial migration. The average sales price in Red Deer now sits at around $380,000, up from $320,000 just a few years ago.
The most active price range continues to be between $300,000 and $400,000, with a significant number of homes still selling in that range. However, the higher price points—$700,000 to $800,000—are seeing fewer sales, indicating a shift towards a buyer’s market as prices increase.
Active Listings and Market Dynamics
Currently, there are only 147 residential properties for sale in Red Deer—significantly down from about 300 properties a year ago. While sales volumes have decreased slightly, the drop in active listings is what’s driving much of the market behavior. You can’t buy what isn’t available, which makes supply and demand the driving force behind these numbers.
What to Expect in 2025
So, what’s ahead for 2025? It looks like more of the same. However, there are some interesting shifts to watch:
Building Boom: More building permits are being pulled now than in 2007, so expect a significant increase in new homes over the next couple of years, particularly single-family homes and multi-family options like townhouses and duplexes.
Interest Rates: Predictions suggest that interest rates will drop every six weeks until the summer, possibly reaching the 3% range again. This will likely lead to more buyers entering the market, which could spur activity in higher price points as well.
Increased Supply, Same Demand: While new builds will increase inventory, low rates will balance this out by bringing more buyers into the market. The market will likely remain low in inventory but high in demand for at least the next few years.
Advice for Sellers and Buyers in 2025
For sellers, depending on your price point, expect quick sales and possibly multiple offers. However, the biggest challenge may be finding your next home without becoming homeless—timing will be key.
For buyers, get prepared. Have your pre-approval ready and don’t expect deep discounts in any price range, especially in the lower price points. The market remains competitive, so being prepared to act quickly is crucial.
Final Thoughts
2025 is shaping up to be an interesting year with low inventory and high demand, along with several evolving variables like new builds, interest rates, and immigration trends. We’ll continue to monitor how these factors impact the market and share insights with you along the way.
Make sure to follow me on social media for weekly updates on different market stats across towns. And stay tuned for next week’s podcast, where I’ll be joined by mortgage expert Arlene to dive into interest rates, mortgage predictions, and the broader economy.
Thanks for tuning in, and we’ll see you next time!