There were 625 more single-family homes sold through Calgary’s resale market in 2017 than the tally from a year earlier.
With 11,831 homes in this segment changing hands last year, activity grew by 5.5 per cent from 2016, says the Calgary Real Estate Board.
This includes 616 single-family homes sold last month, which was the second slowest month of 2017, but outperformed December 2016 by 47 deals.
An area CREB defines as south Calgary paced all ends of the city last month with new owners for 132 homes.
For home styles of all kinds, there were 18,882 transactions through Calgary’s resale market last year, which was up six per cent year over year........Read more
Sales activity for all product types improved in December and pushed monthly sales to long-term averages for the second month in a row.
However, new listings also rose, keeping inventory elevated compared to typical levels for December. With more supply remaining compared to sales, benchmark prices edged down for the fifth consecutive month.
"Many of the economic indicators continue to post modest improvements, including improving sales. However, demand gains have not outpaced the additional supply coming into the housing market.
This is creating some of the bumpiness in terms of price recovery," said CREB® chief economist Ann-Marie Lurie, who added that prices have stayed comparable to last year.
The gap between detached supply and demand closed in the first half of 2017 and supported early price growth. As prices improved, this was perceived as a signal for many who delayed selling their home, and caused a late rise in inventory that limited price growth.
Overall, the detached benchmark price in 2017 averaged $504,867, 0.63 per cent above last year's levels.
Challenges continue to face the apartment sector, with elevated supply in the resale market. The new home and rental markets weighed on this sector. The excess supply caused average annual benchmark prices to decline by four per cent this year. This is a total annual adjustment of nearly 12 per cent since the start of the recession.
In the attached sector, the first half of the year saw an improvement in sales relative to inventory levels. This supported stronger price gains in the second and third quarter. However, a late rise in inventory levels took some of the momentum away from price growth. On an annual basis, attached prices totaled $332,325, comparable to last year's levels.
"This year, we saw a rise in the number of consumers willing to purchase in the market with the expectation that the economy had already shifted. There were also many who waited to list their property until prices showed more stability," said CREB® president David P. Brown.
"Those who acted were typically driven by long-term plans that best suit their current lifestyle. We are ending the year with stronger sales in the last quarter, but supply levels are holding back price gains. The year played out as expected with a transition from price declines to general price stability in most sectors of the market."
Info provided by CREB
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November marks a rise in sales
The November housing market was spurred by a rise in sales, particularly in the lower price ranges.
Sales totaled 1,411 units in November, an increase of 15 per cent over last year. This is comparable to longer-term averages for the month of November. Improved sales activity occurred in each of the housing segments, with most of the gains occurring in homes priced under $500,000.
"The combination of improved confidence and pending mortgage rule changes have likely contributed to the stronger sales activity this month," said CREB® chief economist Ann-Marie Lurie. According to Lurie, the last time that sales activity rose to long-term averages for the month was October 2016, when the stress test for high-ratio loans was first announced.
"Moving forward, we will continue to monitor shifts in demand as improving economic conditions should help offset the impact to the housing market after the new lending policy comes into force in January," said Lurie.
The largest gains in the detached sector were in the $300,000 - $399,999 price range, while the apartment and attached sectors saw the largest gains among homes priced below $300,000.
"We have seen some improvements in confidence with many of our clients. There are some concerns regarding the changes in the lending market, but there is also a significant amount of confusion regarding how it will affect them," said CREB® president David P. Brown.
"For a lot of buyers, they are interested in taking advantage of the choice in the market at all price ranges."
The rise in sales relative to new listings improved this month, helping ease inventory levels over the previous month and keeping the months of supply relatively stable. However, the amount of supply relative to the sales in the market remains elevated. This continues to weigh on prices.
Citywide benchmark prices totaled $436,700, 0.50 per cent below last month, but 0.46 per cent above last year's levels. Both median and average prices recorded a more significant decline compared to last year. This should not come as a surprise, as more sales in the lower price range this year compared to last November would cause a more pronounced drop in average and median prices.
Info Provided by CREB
Prices remain similar to last year, but ease in October
October's housing market conditions closely echoed previous month's trends with easing sales, rising inventories and downward price pressure. Like last month, the monthly activity was not enough to derail gains that occurred earlier in the year.
October sales and inventories totaled 1,467 and 6,463 units for a month of supply of 4.4. Several months of elevated supply in comparison to demand has weighed on pricing over the past several months. The city-wide unadjusted benchmark price in October totaled $438,900, 0.6 per cent below last month, but comparable to last year.
"While economic activity has improved in 2017, it will take some time for this to translate into housing market growth. There have been employment gains, but most of this has occurred in areas with traditionally lower income," said CREB® chief economist Ann-Marie Lurie.
"We also continue to face weak migration, higher lending rates and changes to lending policy. The combination of these factors is impacting housing demand, which is prolonging the pace of recovery."
Resale inventory gains occurred in each product type and across most districts in the city. The largest gains were in districts with substantial new development growth.
In the detached segment, the largest number of units added to inventory occurred in the $300,000 - $500,000 price range. This represents nearly 42 per cent of all detached inventory. 62 per cent of the inventory in the city-wide market is priced below $500,000.
"There is far more product availability in the lower price ranges now compared to several years ago," said CREB® president David P. Brown.
"This provides more options for potential buyers concerned about their purchasing power given all the changes in the lending market."
The largest monthly price change occurred in the apartment condominium sector which recorded an unadjusted monthly decline of 0.8 per cent, resulting in a 13 per cent spread over monthly highs recorded in 2014.
Despite some recent adjustments, prices in the attached and detached segments remain relatively stable compared to last year.
Provided by CREB
Oct 6, 2017 Geoff Geddes
Calgary Real Estate News
Trends shaping the city’s short- and long-term development
Absent a crystal ball, the future of housing in Calgary is very much up in the air. At the same time, there are some notable trends that offer clues to what’s on the horizon for the curious, the concerned and those who just like to plan ahead.
“I think the findings from the 2016 census highlight changes in the Calgary housing market,” said Rylan Graham, a sessional instructor in the Faculty of Environmental Design at the University of Calgary.
“We saw significant growth in many of the inner-city neighborhoods developed pre-World War II, and at the periphery of the city through new greenfield development. These areas are where most of the population growth occurred from 2011-2016.”
As Graham points out, there has always been a critical relationship between transportation and housing choice. With the widespread use of automobiles emerging in the post-war period, residential development could expand further away from the city centre.
Many experts feel that link between transportation and residential demand will only become more pronounced in the years ahead, but in different directions.
“There is a growing demand for neighbourhoods that offer access to a wide array of transportation modes,” said Graham.
“Homebuyers are seeking communities where the corner store, coffee shop and local pub are all within walking or biking distance, or near an LRT station that can whisk them across the city while avoiding the annoyances of commuting by car.”
Related to this demand is the increasing tendency for buyers to trade newness and size of dwelling for location and convenience. While this is partly spurred by a desire to be closer to the city’s core, Desmond Bliek, a senior planner with the City of Calgary, says it’s also a function of demographics.
“We’re seeing smaller household sizes and more multi-residential structures in Calgary that influence the types of dwellings in demand,” said Bliek. “As people age, some may have less interest in maintaining a large home and a greater desire to downsize.”
The change in buyer preferences is good news for those who like to keep their options open.
“From a policy perspective, we are seeing a diversity of housing types in the low-density residential areas,” said Carrie Yap, an urban planner with the Federation of Calgary Communities.
“HOMEBUYERS ARE SEEKING COMMUNITIES WHERE THE CORNER STORE, COFFEE SHOP AND LOCAL PUB ARE ALL WITHIN WALKING OR BIKING DISTANCE, OR NEAR AN LRT STATION THAT CAN WHISK THEM ACROSS THE CITY WHILE AVOIDING THE ANNOYANCES OF COMMUTING BY CAR.” – RYLAN GRAHAM, UNIVERSITY OF CALGARY INSTRUCTOR
Going forward, Yap envisions that trend continuing.
“It all goes back to intensifying the use of land we already have and providing alternatives,” she said. “If you want to age in place, you’ll be able to do that. If you’d like a laneway home or a secondary suite, there will be those options as well.”
Given the prevalence of large parcels of land in Calgary, especially in the inner city, planners might ponder whether one house needs a 5,000-square-foot lot or if they could put three houses in that same space.
“The City is getting more creative in addressing housing options, both future and existing. An example is how they are exploring options with heritage homes by allowing backyard suites to intensify land use if the heritage home remains,” said Yap.
“It’s a matter of being more mindful of the big picture and balancing change with maintaining what makes your community special.”
Will the changes be for the better? Like asking whether the Flames improved in the off-season, it depends on who you ask.
“Everyone has a different view on how the City should function,” said Bliek.
“Through our municipal development plan, the City of Calgary is enabling more intensification, infill, mixed use and more growth around primary transit centres. It’s all driven by the desire to have a more fiscally and environmentally sustainable city form.”
If the City planning process was boiled down to two words, they would likely be “evolution” and “consultation.”
“As planners, we look for feedback from residents and builders on how best to tweak the system and work in conjunction with communities and city council,” said Bliek.
“Things evolve day-to-day based on that feedback as we seek continuous improvement rather than sudden, drastic moves. In the process, we help industry respond to different trends, while ensuring those trends fit existing communities and the preferences and values of the residents.”
Inventory increases and sales drop in September, but overall sales for the year remain higher than last year.
Strong gains in the first-half of 2017 has put the Calgary year-to-date sales at seven per cent above last years' levels and 11 per cent below long-term averages, but challenges remain with easing sales and rising new listings.
Inventories rose across all property types to 6,861 units, while both apartment and attached-style properties saw the highest inventory on record for the month of September.
"The recent rise in inventories is preventing further price recovery as sales activity has moderated over recent months. This does not come as a surprise as sales activity is expected to remain modest by historical standards until more substantial economic improvements take hold," said CREB® chief economist Ann-Marie Lurie.
"Some may consider this a setback, but it is important to note that recent movements are balancing out the higher than expected gains that occurred in the first-half of the year."
New listings in September totaled 3,266 units, a year-over-year gain of nearly 10 per cent.
"There are several factors influencing new listings. Given the falling prices over the past two years, some sellers were waiting for market conditions to improve prior to listing their homes. More stability in the market has prompted many of those sellers to no longer delay their listing decision," said CREB® president David P. Brown.
"In some segments, rising new home inventories are also impacting total housing supply. Ultimately, prices are affected. However, this inventory also opens up opportunity for buyers to step up into a home that was financially unattainable."
As of September, unadjusted benchmark prices totaled $441,500. This is 0.2 per cent below last month, but nearly one per cent above last year. Downward price pressure this month occurred across most product types. However, year-to-date benchmark prices in the detached sector remain comparable to last year.
Prices in the detached sector remain relatively stable compared to last year. Condominium apartment prices remain four per cent below 2016 levels and twelve per cent below 2014 highs. This sector continues to struggle with price declines resulting from excess supply as months of supply pushed above eight months.
Information provided by CREB