Chuck Chiang, Calgary Herald
Published: Saturday, June 14, 2008The strong economic pull of the oilsands in northeastern Alberta will keep the housing market in the Fort McMurray area robust for the rest of this year, bucking slowing trends elsewhere in Canada, says a federal agency.
The average MLS home price in Fort McMurray will likely jump 15 per cent in 2008, reaching $530,000, says market analyst Richard Cho of Canada Mortgage and Housing Corp.
In comparison, the national average is expected to grow by 5.1 per cent during that time.
"We're expecting another strong year," says Cho about the Regional Municipality of Wood Buffalo, which includes Fort McMurray. "Basically, what (the numbers) say is that there is still a very strong demand for homes in Wood Buffalo's case."
The average price of single-family homes reached $692,127 in May, compared with $518,934 just a year ago, says Milly Quark, president of the local real estate board.
When asked if real estate activity has slowed down significantly in Fort McMurray in recent months, Cho says: "Oh heavens, no."
Other measurements of the market offer further contrasts between Fort McMurray and other parts of Canada.
CMHC is forecasting 2,350 housing sales in the Fort McMurray region this year, holding in line with last year's total of 2,373.
Nationally, sales are expected to drop by 8.5 per cent, says the same CMHC projection.
Fort McMurray's 291 housing construction starts from January to April are the highest on record since the federal government started keeping track of the figure in 1988.
CMHC says the moderation in the national housing market is a sign of the balancing of housing supply and demand -- adding that the nation-wide average price growth of 5.1 per cent is still above inflation and strong by historical levels.
But Cho says this only highlights the uniqueness of the Fort McMurray market, which is located smack-dab in the middle of one of the largest known oil deposits in the world.
"Oil prices are at record levels," says Cho, adding that a number of oilsands mines are being built in the region, requiring a large influx of workers to migrate to the area. "It's going to keep investments in that region at a high level and if that's going on, Read more