Housing market retains momentum in April

City-wide prices hold steady as labour market improves

Calgary’s housing market continued to show signs of stability in April. With improvements in the labour market and a balanced detached sector, city-wide benchmark prices reached $439,600 in April, similar to the previous month, but 0.90 per cent below last year’s levels.

“More jobs means less uncertainty for people who are sitting on the fence,” said CREB® president David P. Brown. “There also tends to be fewer people who need to sell when employment improves, and that can prevent inventory gains and further price reductions in the market. It’s a good scenario for sellers who are entering a spring market that’s in better shape than anything we’ve seen in recent years.”

While adjustments are still occurring in the apartment condominium sector, the detached segment of the market is improving across all price segments.

“Detached product has not faced the same supply pressure as the apartment sector,” said CREB® chief economist Ann-Marie Lurie. “Detached supply from new construction didn’t surpass previous highs. That helped prevent steeper price adjustments in the detached sector when demand eased.”

The relationship between sales and inventory will be a key driver for pricing in the months ahead. Total transactions improved to 1,917 units in April, while inventories totaled 5,495 units, pushing months of supply below three for the second consecutive month.

With sales up and overall market inventory down, months of supply has already pulled back from elevated levels recorded over the past two years. While activity continues to vary by location and product type, more balanced conditions will help to support overall price stability.

“Improvements in the employment situation were necessary to prevent further declines in the housing sector,” said Lurie. “However, economic recovery is still expected to be slow, impacting the pace and quality of job growth. Based on current expectations this should translate into a more prolonged period of recovery in the housing market.”

Give me a shout  if you want to know the specifics about your property or neighbourhood!

Housing market set for favourable lead into spring

Detached prices stabilize as city-wide inventory trends down

After a long period of disconnect between supply and demand, Calgary’s detached housing sector is firmly in balanced territory. Sales were still 10 per cent below long-term trends in March, but above levels seen in recent years, while average inventory declined compared to last year, supporting price stability in the detached market.

“It’s not so much that demand went through the roof in March, but that we had less supply come onto the market, which is really helping to balance things out,” said CREB® president David P. Brown. “These changes are lifting the cloud of uncertainty for housing consumers and nicely positioning our market as we move into the more active spring season.”

Unadjusted detached benchmark prices totaled $503,900 in March, 0.4 per cent above last month and similar to levels recorded last year. Meanwhile, Apartment and attached prices continue to remain well below levels recorded last year.

“Market conditions are quite different in the apartment sector,” said CREB® chief economist Ann-Marie Lurie. “The additional supply coming from the new home sector is not easily reversed and the added competition is continuing to weigh on prices in the higher density sectors of the market.”

City-wide inventory levels totaled 5,114 in March, 16 per cent below last year’s levels. This is primarily driven by the 25 and 17 per cent contraction in the detached and attached markets. Inventory levels in the ownership apartment sector remain three per cent higher then levels recorded last year.

“The housing market transition in the first quarter appears to be consistent with trends in the labour market,” said Lurie. “However, the way the rest of the year unfolds will be largely determined by what happens in the next two quarters, as nearly 60 per cent of all housing sales typically occur in that time frame.”

A Transition in the Making!

Detached sales activity boosts February housing market

After the first two months of the year, Calgary’s detached sector continues to drive a slow transition in the housing market. February sales totaled 1,342 units, which is still 19 per cent below long-term averages, but an improvement over the past two years.

As sales kept trending upward, detached inventory levels continued to ease in February. These conditions caused months of supply to fall to 2.4 months, putting less downward pressure on pricing. Unadjusted detached benchmark prices totaled $501,900 in February, which is one per cent lower than prices recorded last year, but slightly higher than January figures.

“There seems to be a new sense of optimism these days,” said CREB® president David P. Brown. “Some sellers are feeling upbeat about the changing landscape and the improved chances of selling their home. Other people are looking at the spring market with caution and wondering if we’re going to see a higher than expected surge of listings. While there’s less product on the market right now, sellers still need to be realistic with their pricing.”

The amount of excess inventory eased in the overall market in February, setting the stage for a transition to a more stable market this year. Months of supply totaled 3.4 months, down from five months over last February. At the same time, the sales-to-new-listings ratio trended from a near record February low of 39 per cent last year to 55 per cent this February.

With sales improving and new listings and inventories contracting—two key measures of market balance, there’s good evidence to show that the housing market has started a trend toward more balanced conditions.

“The transition in the housing market appears to be underway,” said CREB® chief economist Ann-Marie Lure. “However, it is important to note that this change is primarily being driven by improvements in the detached market and stability in the labour market.”

“It will take some time for these conditions to translate into all housing segments and achieve price recovery,” said Lurie. “But all indicators continue to point toward a slow transition from a contracting market toward one that is stabilizing at lower levels.”

Click here to view the full City of Calgary monthly stats package.

JUST LISTED : 1313 Lake Fraser Court SE

This one bedroom bungalow style condo is sure to impress! Step in and be greeted with the abundance of natural light and a gorgeous fireplace. The open floor plan living and dining room is spacious and bright. You can easily see all the upgrades in your new home!

The kitchen features warm honey brown shaker-style maple cabinets and plenty of smart storage space. The upgraded granite is almost a piece of artwork with it’s natural beauty and durability. All the appliances are included, even a new garburator.

The master bedroom is a very large space with room for dressers, an armchair and even more. All that space and a dramatic, full-mirrored walk-through closet that brings a touch of elegance and luxury to the master retreat. Your private 4-piece bathroom has a linen closet and lots of additional storage.

Both bathrooms feature contemporary design optimized for style and functionality, and a full stacking washer-dryer set is tucked neatly into powder room.

There is a good sized covered balcony that overlooks a quiet green space and is very private for your barbecuing and summer enjoyment. Also included is a titled parking spot and an assigned separate storage unit.

The entire condo was recently painted a neutral, colour palette which means that it is move-in-ready yet adding personality is easy and fun. Lots of upgrades were added when this condo was purchased and the original owner has maintained this unit with pride.

Bonavista Estates is well known for it’s wide range of amenities, including a theatre room, party room, exercise room, dining space for large functions and even a car wash bay.

Well managed, convenient location and all the comforts come standard at the highly sought-after Bonavista Estates; get all that and more in this unique, attractive, move-in-ready condo.

V671QYO6DIW_m V671ZRDJVAW_m V6728NIR0YW_m VD6D7HYKITF_m

For more information click here!

JUST LISTED : #41 1055 72 AV NW

Safe, serene and sunny living comes standard in the excellently maintained and professionally managed Huntington Ridge Complex.

This 3 bedroom and 1 and a half bathroom townhouse boasts a private, west facing back patio, living room balcony with sliding doors, and single attached garage. There is a large living room and an abundance of storage.

Natural light spills into every room and gleams off the bright white kitchen and the golden hardwood flooring. The bright finishes and fixtures throughout the home bring a blissful atmosphere to each room.

Fresh paint and brand new carpets mean you get a bright blank canvas to make your own, and with an unbeatable location, this spot is perfect for first time homeowners, and seasoned investors alike. Walk to the playground across the way in less than a minute, or chill out with the SHAW cable TV package included in your low, $307 condo fee.

Discover ideal family living today in comfortable Huntington Ridge! Welcome Home!

For more information click here

IMG_9448 IMG_9459 IMG_9482 IMG_9513

JUST LISTED : 171 Elgin Terrace SE

This Cardel “Ellsworth Towne” family home mixes classic comforts and sensible design with appealing modern twists. As natural light streams through generous windows on the main floor, your 9” ceilings will seem even higher.

A sun-lit dining nook adds interest and appeal to the otherwise open plan dining area, and the attractive tiled floor adds style and function to your main living space. A corner gas fire place and kitchen island with 2-person breakfast bar top off the room with cozy charm.

A separate front den/office, a 2pc bathroom and conveniently placed laundry room complete this level.

Upstairs, you’ll find a sun-lit bonus room perfect for hobbies or play, and a balcony. Spa-like fixtures beckon from the master ensuite, like the glass shower and jet tub. Two additional bedrooms and 4pc bathroom complete the upper floor.

The lower floor is partly finished, but is home to a seriously cool rec room. Back lane gives you access to your beautiful backyard, large deck and double detached garage.

For more details click here!

CREB® forecasts a slow transition for housing in 2017

After a long period of economic downturn, Calgary’s housing market is expected to see some price stability in 2017, but not across all market segments and property types. Both detached and attached prices remain unchanged over 2016 levels, while apartment is forecasted to contract by another two per cent.

“The transition in the housing market will be a slow process,” said CREB® chief economist Ann-Marie Lurie. “We are entering the year with high unemployment rates and the possibility that job growth will not occur until the latter portion of 2017. These conditions will continue to weigh on housing demand, but supply is adjusting to weaker sales activity, which will eventually translate into price stability.”

City-wide sales are forecasted to total 18,335 units in 2017, a three per cent gain over 2016, but 12 per cent below long-term averages. This modest demand change will merge with declining listings and easing inventory in the new home market to support more balanced conditions and prevent further downward pressure on prices.

“This year is about moving away from extremely challenging conditions,” said 2017 CREB® president David P. Brown. “The transition is going to take some time, which means sellers need to stick with the fundamentals of pricing their homes correctly against other comparable product in the market. There’s still lots of choice out there for buyers, but major price declines are unlikely in most segments.”

Alberta’s economy was much softer than many predicted over the past two years, as prolonged weakness in energy weighed on other sectors of the economy, including housing. Since the start of the downturn in late 2014, price adjustments have ranged from a low of nearly five per cent in the detached sector, to a high of 11 per cent in the apartment sector. The amount of price change between these different areas of the market was based on how much oversupply there was in each sector at any given time.

Our housing market is moving toward a new equilibrium, but that shift is heavily dependent on stability in the energy sector and overall labour markets. There is also considerable risk from recent government policy changes that could derail expected gains in the second half of 2017. It’s a new outlook this year, but the market risks shouldn’t be overlooked.

For the full report click here

Home sales rebound in October

For the first time in two years, sales activity in October resembled normal levels. City-wide sales totaled 1,644 units, which is an increase of nearly 16 per cent over last year.

“The shift in sales activity this month is likely related to the new mortgage rule changes, inventory gains in the lower price ranges and further price adjustments,” said CREB® chief economist Ann-Marie Lurie. “The combination of all these factors may have encouraged some purchases to take advantage of the market conditions, particularly in the lower price ranges. However, with several factors at play, the monthly shift in demand may be temporary and will need to be monitored over the next several months.”

Sales activity rose across all product types in comparison to last year, but the largest gain in sales occurred in the detached sector at 18 per cent. There was a noticeable shift in sales activity by price range in October. In the detached market, homes priced between $300,000 and $400,000 saw the largest improvement in sales, while attached and apartment sales growth was mainly occurring in the lower price ranges.

“This year has been a challenge for many sellers,” said CREB® president Cliff Stevenson. “So when we have a rise in sales, it means more buyers got into the market and more sellers got out, which is a positive for consumers on both sides of the transaction.”

“Sales activity changed direction in October, but we need to see some consistency next month and the month after to call it a trend,” adds Stevenson. “For now it’s a nice building block.”

Despite the monthly rise, year-to-date sales activity in all sectors remained lower than last year’s levels and well below longer term trends. In fact, year-to-date sales activity has totaled 15,642 units, which is 6.3 per cent below last year’s levels.

While increased activity in the lower price ranges had a greater impact on the average and median price, benchmark prices once again edged down in October. The city-wide unadjusted benchmark price totaled $438,900, or 0.34 per cent below last month and four per cent below last year’s levels.

Since the start of the downturn, home prices have declined from a low of 3.8 per cent in the detached market to a high of 9.4 per cent in the apartment condominium sector. And, despite the rise in October sales, monthly prices continued to decline for most product types in the market.

Detached Prices Stabilize in Soft Market

The segment of Calgary’s housing market with the greatest influence on the overall market is showing signs of pricing stability. The detached benchmark price totaled $503,400 in September, which is 3.3 per cent below last year, but the second consecutive month at this price level.

While overall economic conditions remain soft, for now the detached sector is demonstrating some steadiness in terms of pricing.

“The decline in demand has caused many to anticipate steeper price declines for detached homes,” said CREB® chief economist Ann-Marie Lurie. “That hasn’t happened in large part because detached supply levels haven’t climbed as sharply as many expected. There was a limited amount of supply in the overall market when this cycle began, and while levels did rise and remain somewhat elevated, they were well below previous highs.”

The level of detached new listings also eased compared to last year, helping push down year-over-year inventory levels for the second consecutive month.

“Consumers are really starting to come to terms with the current environment,” said CREB® president Cliff Stevenson. “Most sellers have adjusted their expectations at the same time that many buyers are realizing the price of a home is influenced by factors like location, supply in specific price ranges and condition of the property.”

Residential inventory levels totaled 5,877 in September, five per cent higher than last year, due to gains in both the apartment and attached sectors. City-wide months of supply neared four months, but ranged from a low of three months in the detached sector to a high of eight months in the apartment sector.

Sales were equally inconsistent, improving by four percent in the detached market while declining by 23 percent in the apartment sector. Nonetheless, in every category, sales activity year-to-date sales activity has declined over levels recorded last year and remains below long-term averages.

The resale apartment market has recorded large inventory gains and a sharp pull-back in sales. This, combined with additional competition from new builds, is resulting in steeper price adjustments in this sector.

Condominium apartment prices totaled $274,700 in September, 0.1 per cent below last month and 6.8 per cent below last years’ price.

Five Things About Population Impact On Housing

Weak net migration expected to impact Calgary’s housing market

Population growth in Calgary will moderate moving forward and contribute to a decline in housing demand, according to a market brief issued earlier this month by Canada Mortgage and Housing Corp. (CMHC).

In the release, the national housing agency noted net migration is expected to remain relatively weak over the next two years, which will have a trickle-down effect on the local real estate market.

CREB®Now breaks down five things you need to know about how population will impact housing demand in Calgary this year and next.

The History

Calgary’s population outpaced the national average for the 10 years preceding 2015. From 2006 to 2015, the city’s population increased an average of 2.81 per cent per year, compared with 1.12 nationally. CMHC credited the growth to favourable economic conditions, which attracted prospective workers to the region. This also boosted demand for housing, with total starts and MLS® sales both reaching record highs in 2014.

The More Recent

Calgary’s population growth started to level off in 2015, when the rate of newcomers to the city grew at 2.44 per cent, down from 3.55 a year earlier. CMHC attributed the moderation to weak oil prices that ultimately impacted investments in the energy industry – and, thus, employment prospects in the city.

The Employment Picture

While 2015 might have looked and felt like 2008, it will be considerably different moving forward. CMHC said economic recovery will be more gradual this time around, resulting in job losses – especially in full-time positions. In the first quarter of 2016, the city’s unemployment rate increased to 8.96 per cent compared to 5.67 in the same period in 2015.

The Outcome

With fewer employment opportunities in Calgary, along with stronger labour market conditions in other areas of the country, CMHC said net migration to the city will decline and remain relatively low. Net migration is projected to decline from 21,057 in 2015 to 14,000 in 2016, and then rebound slightly to 14,500 in 2017. This will limit Calgary’s population growth and temper housing demand.

The Outlook

Following several years of elevated growth, Calgary’s population will rise only 1.91 in 2016 and 1.81 per cent in 2017, said CMHC. This will bring the population in Calgary to 1,466,500 and 1,493,400 in 2016 and 2017, respectively.

“Total population in Calgary is forecast to grow at its slowest rate since 2010, largely due to a decline in net migration, and contribute to weaker demand for housing,” said Richard Cho, senior market analyst in Calgary for CMHC’s Prairie region.

 

CREBNow By: Jamie Zachary