Market Update– A strong start to the year in Sylvan Lake after a slow December. The number of pending sales suggests that the month could end strong as well. The active listing count is higher than it was a year ago, but not high enough to be a big concern.
raction in Alberta’s GDP of about one percent last year. Unfortunately, early 2016 holds little promise of a quick rebound. Excess global supply form OPEC producers, coupled with uncertainty in China, Europe and the Middle East, continues to weigh on oil prices. This has led to even greater stress on the balance sheets of the province’s energy producers as they struggle to reduce costs. Natural gas prices continue mostly unchanged in a price range unsupportive of new investment or production.
The strains in the oil patch are also weighing down industries peripheral to petroleum extraction, particularly manufacturing and construction. As well, weaker consumer sentiment has resulted in reduced retail trade and residential housing construction. All of this has resulted in an overall deterioration in the job market.
As always, though, there remain pockets of optimism. Agriculture, forestry, tourism – which are the province’s other major industries – continue to perform well. Prospects for 2016 are positive, particularly with the weak Canadian dollar making commodity exports more attractive, and encouraging more U.S. tourism.
The Economics and Research team at ATB Financial is estimating a GDP contraction of 1 percent in 2015, with a smaller contraction 0.5 percent in 2016. Most of the economic stress on the economy and labour market are expected in the first half of the year. Stability and even some return to modest growth is still anticipated by the end of the year.