How was the Charlottetown market in 2007??
Here is a report on how the real estate market faired out last year. This report was taken from the Canadian Mortgage and Housing Corporation. They have lots of free information on their website at www.cmhc.ca
MLS® Sales slowed in the Fourth Quarter
MLS® sales in the Capital region were down 10% in the fourth quarter of 2007, when compared to the same period in 2006. It is expected that this decline seen in the fourth quarter will be the start of the the local market returning to more sustainable levels. However, on an annual basis MLS® sales in 2007 actually set a new record high for the area with 650 units sold. Since 2002, the resale market in the Charlottetown area has been performing above average both in terms of increases in unit sales and average price. In fact, record highs have been set in three of the past five years for unit sales, and over this period the average sale price continued to increase. This level of activity has been spurred on in part by strong employment growth, positive migration and relatively low interest rates. Also, the rising cost of new home construction during this period has positively influenced the resale market, as the price gap between the two has continued to widen. The gap in some cases is such that potential home buyers may opt for an existing home due to the substantial difference in price.
New listings increased slightly in the fourth quarter, and on an annual basis are only slightly behind the near record high level set in 2006. The main reason for the continued strength in new listings is that current homeowners continue to list their properties in an effort to realize the profits from the recent appreciation. The rise in new listings has provided potential homebuyers with greater choice when purchasing a home. It has also removed the sense of urgency from the transaction that many buyers may have experienced in recent years as a result of the low levels of listings in the previous years. The end result is that the average days on the market rose to 76 days in 2007, up from 73 and 58 days in 2006 and 2005 respectively.
MLS® sales in Charlottetown area posted mixed results in the fourth quarter of 2007. The Cornwall area, District 6, continued to remain popular with buyers as seen by the 47% increase in sales over the same period in 2006. Charlottetown City, District 4, recorded notably less activity in 2007 with a 34.8% drop in sales in 2007. District 7, the Stratford area, also posted a sharp decline in the fourth quarter with sales dropping by more than 20% compared to 2006. On an annual basis Districts 6 and 7 saw MLS® unit sales increase by more than 19 and 31 per cent respectively. Conversely sales declined in District 4 by more than 12% and in District 5 by 10.5%.
In the fourth quarter the average sale price increased in two of the four districts. District 6 posted the largest increase in average sale price during the quarter, advancing more than 20% to $132,212. District 5 also saw a significant increase in the fourth quarter with the average price rising by almost 5 per cent to $168,839. On an annual basis the average price of a home in Charlottetown rose in all area districts. As was the case in the fourth quarter, District 6 posted the large advance in 2007 with a 16 per cent increase. Districts 4 and 7 also posted significant increases with the average sale price rising by more than 8 and 4 per cent respectively.