“The Stage Is Set For A Massive Housing Market Correction in Canada’s Oilpatch”
Two weeks ago we reported that “the next victim of crashing oil prices has been identified: housing“, particularly non-residential construction among the energy producing regions, where the capex collapse reality is already being felt far and wide. Eventually, once the overall economy of these same oil producing regions is impacted sufficiently, the pain would spread to residential housing as well, as the energy boom that kept the local economies humming for years, turns to a bust. But while the US patiently, and nervously, awaits the outcome of the crude crash, one place is already starting to suffer the consequences of the price collapse is Canada’s energy Mecca, Calgary, where as the Financial Post reports, “the stage has been set for a massive correction in the oilpatch.”
To be sure, just like with US production, nobody is quite ready to pull the plug just yet and indeed, “the price correction hasn’t happened”… yet. “The average price of a home sold in January was $460,933, down 0.5% from a year ago. The median sale price climbed 1.1% from a year ago to $417,500.”
But it’s just a matter of time, and as FP adds, “the stage has been set for a massive correction in the oilpatch.New listings jumped 37% from a year ago while the overall inventory was up 113.4% during the same period. A year ago, based on market conditions at the time, there was 1.52 months of supply in the system. At the end of last month, that number was 5.29 months.”
…click on the above link to read the rest of the article…
