As of Oct. 31, Estevan has experienced the largest decrease in housing prices of anywhere in the southern part of Saskatchewan. That data came from the Composite Housing Price Index produced by the Association of Regina Realtors.
Lynn Chipley, who is owner/broker with Century 21 Border Real Estate Service said that over 10 years, they are exactly where they were when they started.
Even though most people knew that the Estevan’s real estate market has been in bad shape lately, until the numbers came in not too many people realized that the Energy City has actually claimed the number one spot on the negative list.
“We knew that the market in Estevan was sweeping, and we knew that the prices were falling, and we knew that our numbers were down. We knew all that, but we weren’t sure how much though. So this confirmed my own rough calculations,” said Chipley.
Over the last five years, the real estate in Estevan went down 23.65 per cent with Weyburn being second at -19.36 per cent. As a result, contemporary real estate prices in Estevan are almost exactly the same as what they were 10 years ago.
“We are at a .22 gain (in comparison to 10 years ago), which is really nothing. If you sold the house in 2010 for $200,000 today it would be worth $200,000,” said Chipley.
At the same time, Swift Current, which has built a new power plant, gained almost 35 per cent. However, it might change for them as well when construction is completed and workers will move forward to the next project somewhere else in the country.
Estevan prices went up drastically during the boom years and especially during the construction of the Boundary Dam Carbon Capture and Storage (CCS) facility. When workers came to Energy City they put the biggest pressure on the housing. But when the project was finalized in 2014 and the new plans didn’t come in place, along with the oilpatch slowdown, it crashed the real estate market, making prices fall back to where they were 10 years ago.
On top of that, Estevan now is seeing an alarming number of repossessed properties coming onto the market.
“That’s not because those were bad people who bought them that just don’t care. I think there were a lot of good people that came to Estevan to work and they didn’t really have a choice if they were coming to work, except to buy into our market at that time,” said Chipley.
“And now, if they no longer have work in Estevan, they have to relocate for whatever reason and they bought during boom times. If the prices are 25 per cent less than what they purchased, they simply can’t sell them, because they can’t afford to clear their mortgages. So they have no other option except to walk away.”
Chipley said they are seeing at least a couple of repossessed homes a week coming onto the market.
“No one else in the province has seen something like what has happened to us,” said Chipley.
But she noted that there is something good for someone in any situation. For example, for first-time homebuyers or any buyers in general the current conditions of the market are beneficial.
“It’s a great time for people to get into the housing market,” said Chipley.
The sales are still happening steadily throughout the year, which is unusual since the market traditionally was seasonal with slower times in winter and early spring. Chipley said that now they are seeing six to 10 houses selling a month all year long. She explained that prices continue to drop and buyers continue to see really good deals, so they are taking advantage of that.
Properties under $250,000 are selling the best. There are a few higher-end sales too, but this part of the market is much slower.
And unless the economic situation in Estevan changes nobody can guarantee that the market won’t sink even more.
“The loss of power station, I think, it will be something close to catastrophic for Estevan. And without something to replace those kinds of jobs… We need something positive. Whether it’s in the oil industry, whether it’s a value-added proposition through agriculture, whether it’s the announcement of a nuclear power plant for Estevan. We need some kind of positive industry news,” said Chipley.
