The housing market in Lethbridge is experiencing a sense of optimism for the coming year, according to Bridget Mearns, the executive officer of BILD Lethbridge. There is a growing demand for housing in the city, with migration from other parts of Alberta as well as from Ontario. Despite an unusual blip in December last year, with 20 single detached home starts, the new housing numbers seem to be in a normal range. Mearns attributes this to the favorable weather conditions, which have allowed builders to continue working on projects before the winter sets in.
There has been a significant increase in the number of permits issued this year compared to the same time frame last year. So far, 213 permits have been issued, with 189 of them being for residential projects. The most significant increase is seen in the number of renovation permits, with 141 issued this year compared to 64 last year. The total value of permits issued this year is $34,591,350, with the majority of it being for new residential building projects. There are also 11 new single detached permits with a value of just over $6 million.
One surprising statistic from January was the 85 multi-unit apartment starts that were performed. When it comes to financing a home, mortgage broker Rob Bain points out that the decision to buy now or wait depends on various factors, including interest rates and housing prices. Despite the uncertainty, the housing industry is beginning to heat up again for the year, with all eyes on the Bank of Canada for potential rate cuts or decreases by mid-2024. With sale prices currently lower than in December but still higher than last year, there is hope that the real estate markets will take off as the cost to build houses gets closer to the sale prices.
Mearns highlights the importance of the cost to build houses matching the sale prices for the real estate market to truly take off. In January, the sale prices were $543,377, which is lower than in December but higher than last year. The cost to build them is $365,279, creating a difference of $178,098 between price and cost. When these two numbers get closer, it is expected that houses will begin to sell at a faster pace. The next prime rate announcements by the Bank of Canada are scheduled for June, which will be closely monitored for any potential impact on the housing market.
Overall, there is a sense of optimism in the Lethbridge housing market for the coming year, with a significant increase in permits issued and a growing demand for housing in the city. The favorable weather conditions have allowed builders to continue working on projects, contributing to the overall growth of the market. As interest rates and housing prices continue to fluctuate, potential buyers are urged to consider the current market conditions when deciding whether to buy now or wait. With all eyes on the Bank of Canada for potential rate cuts, the housing industry is expected to heat up further in the coming months.
