April 5, 2019

Calgary Real Estate Market Update - April 2019

Increased Sales for Affordable Housing Has Not Reduced Oversupply

Overall, there was a slight decline in sales activity across the city in March, compared to 2018. However, sales have increased for the more affordable attached and detached homes.

Shifts occurring at the lower end of the housing market have not been enough to outweigh the softening that is occurring in higher priced homes. First-quarter sales plunged to 3,108 units, which is 9% lower than last year and 28% lower than usual activity levels.

Declines in prices and slower sales activity are affecting how many new listings come on the market. This is the second month in a row that new listings softened compared to 2018 levels and trends long-term. But, this level of softening was not enough to avoid an inventory growth.

Ann-Marie Lurie, CREB® chief economist said, “If the number of new listings continues to be relatively low compared to sales, there could be an improvement in the oversupply situation that is putting a damper the housing market.”

“Because the inventory is still so high, it will be some time before our market returns to a more balanced situation that includes more stable pricing.”

With 6,695 units still available in March, the number of months of oversupply softened to five months. While this reflects an improvement over the last few months, we continue to have an oversupply situation when compared to March levels recorded over the years.

This level of oversupply in Calgary has led to further price declines. Benchmark prices in March softened to $413,900, which is 5% lower than 2018 levels and slightly lower than last month’s recorded levels.

 

UPDATES IN THE HOUSING MARKET

Detached

·  The decline in first-quarter sales was almost 9% compared to 2018 and 30% lower than the usual sales activity.

·  Sales of detached homes are varied, depending on price range and location. We’ve seen gains among the most affordable homes in each district.

·  Across the city in March, sales of detached homes improved for those priced below $500,000

·  Despite the softening of new listings, there was an increase in inventories over 2018, which pushed the months of oversupply to the highest level that has ever been recorded for March. When looking at sales activity by district, the East and North East districts have experienced a softening compared to 2018.

·  Oversupply of detached homes continues to dampen prices in all districts across the city with benchmark prices softening 5.4% compared to 2018, bringing the benchmark price to $475.800.

   Condominiums & Apartments

·  Sales of resale condominiums dropped by 14% in March, which caused first-quarter sales to come to 464 units, which is 17% lower than 2018. This decline didn’t happen in every district because there was an increase in sales activity in the West and North districts. Despite these signs of improvement in these districts, overall sales activity is still much lower than long-term trends.

·  Supply of condominiums and apartments is showing signs that it is adjusting to lower demand. There was a softening of new listings in March compared to 2018. Unlike other types of properties, this is affecting inventory levels. March inventory was at 1,488 units, which is 12% lower than 2018 levels.

·  The number of months of oversupply has moved down from earlier this year, but since sales have been weak, it is still higher than 2018 levels.

·  Condominium and apartment prices across the city dropped 0.7% from February and 2.6% over 2018. However, in the South East and North East districts, prices recorded a slight gain over 2018.

 Attached Homes

·  March experienced a slight increase in attached sales due to improvements in the row and semi-detached sectors. While there were gains in March, sales year-to-date are still 4% lower than 2018 levels and 16% lower than long-term averages.

·  There has been a softening in year-to-date sales, but things have improved in the South East and South districts.

·  Months of oversupply remain high citywide, despite some increased sales activity.

·  Prices kept going down for semi-detached homes with a benchmark price of $391,000 in March. This is almost 6% lower than 2018 levels and 0.4% lower than the prior month. However, things were different in the North district as months of supply has been tightening, supporting a slight price gain compared to the prior month and 2018.

·  Row prices for the Month of March were still pretty flat compared to the prior month, but are still more than 4% lower than 2018 levels and more than 13% below previous highs.

 

REGIONAL MARKET UPDATES                                    

Airdrie

·  Sales in the first quarter were 7 units below 2018 levels. There was also a first quarter decline in the number of new listings of 47 units, so there was no significant change in the market when it came to inventory levels. The months of oversupply stayed elevated and averaged 5 months at the end of the first quarter.

·  The continuing oversupply has a negative effect on prices. Benchmark prices across the city in the first quarter softened by 1.7% compared to the prior quarter and continue to be 4.6% lower than first quarter levels in 2018. Although prices softened across all types of property, the steepest declines were in the condominium and apartment sector.

 Cochrane

·  First quarter sales in Cochrane were 114 units and new listings came to 330 units. For both these numbers marked a decline over 2018 levels. The fairly steep pullback in sales resulted in a rise in inventories with months of oversupply reaching 8 months.

·  Continuing oversupply in the housing market has dampened prices. Benchmark prices softened by 1.6% after the first quarter compared to 2018 and 1.5% compared to the prior quarter. The attached sector experienced year-over-year declines of 2.7% compared to 1.5% in the detached sector.

 Okotoks

·  Sales and new listings both slowed down in the first quarter compared to 2018. However, the slowing of new listings was not drastic enough to lower inventory levels. Months of oversupply continued elevated at an average of 7.7 months this first quarter.

·  The continual oversupply has affected prices. Benchmark prices for detached homes averaged $413,733 this first quarter, which is a 4.8% decline compared to 2018 and 3.8% lower than the prior quarter. Price declines of attached homes were a little higher with benchmark prices coming to $376,433 in the first quarter, which is 5% lower than 2018.

 

 

 

Posted in Market Update
March 4, 2019

Housing Market Still Chilly Due to Persistent Oversupply

Calgary’s weak economy continues to contribute to soft sales in a housing market with elevated inventory.

The result of this is certainly reflected in prices.

“The ongoing slow down in home sales continuing into February is no surprise,” said Ann Marie Lurie, CREB® chief economist.

“Since the economic climate has not changed in any demonstrable way people working in the energy sector are concerned about job security and this affects confidence.”

February benchmark prices across Calgary were at $414,400. This figure is almost 5% below January 2018 figures, slightly below the prior month’s and more than 10% below 2014 highs.

Although the housing market in Calgary is still oversupplied, softening sales and declining prices are apparently having an influence on sellers. February experienced an 8% decline in new listings compared to February 2018, which numbered just 2,211 units.

UPDATES IN THE HOUSING MARKET

Detached Homes

·  At the end of February, sales of detached homes for the first two months of 2019 totaled 1,079 units, which is 13% lower than this time last year and 30% lower than long-term averages. Home sales softened across almost all districts of the city, but not the North West. Sales activity stayed far below the usual levels in all districts.

·  New listings across Calgary ranged from an increase of 15% in the North West to a 23% decline in the North district. New listings year-to-date came in at 2,544 units, which is almost 2% lower than last year.

·  Despite those new listing adjustments, detached sector inventories saw a rise on average of 25% compared to 2018 levels. However, looking at the more affordable areas for detached homes, including the East and North East districts, we saw a decline in inventory levels compared to 2018.

·  With months of inventory in the detached sector staying above 5 months, prices keep trending lower. Benchmark prices across the city in February were $475,600, which is 0.2% lower than January prices and more than 5% below February 2018 levels.

Condominiums & Apartments

·  Even though condominiums and apartments are relatively affordable, sales continued to be slow at just 149 units.

·  Unlike what’s happening with detached homes, with 7 years in a row of new listing declines, the impact is starting to affect inventory levels.

·  Inventory levels came to 1,301 units in February, which is 9% lower than last year’s levels. Inventories did soften, but February’s slow sales meant that the months of oversupply remained near 9 months.

·  Benchmark prices in February for condominiums and apartments were at $252,300, which represents a 1.7% decline from last year’s prices, even though they were similar to last month’s figures. Prices for condominiums and apartments have fallen by 16% over the highs of prior months.

·  Benchmark prices across Calgary have softened, but certain districts have had modest gains, but not enough to eliminate prior declines. However, this is an indication that prices may be moving towards more stability in certain areas.

Attached Homes

·  Things remained pretty much the same in the attached homes sector, with months of inventory staying nearly 7 months and prices remaining constant compared to January, yet still 4% lower than prices last year at this time.

·  Just as with condominiums and apartments, activity can fluctuate dramatically depending on the location. Semi-detached benchmark prices softened by more than 5% compared to 2018, with the largest declines in the City Centre and South districts.

·  The North district experienced a slight improvement in prices.

·  Row prices were down by almost 4% from last year’s levels. Unlike semi-detached home prices, row prices softened across the entire city compared to 2018 and are still almost 14% lower than monthly highs.

REGIONAL MARKET UPDATES

Airdrie

·  Total sales are 150 units so far this year in Airdrie, which is 27 units lower than recorded levels at the same time in 2018. However, these numbers compare to the average amount of activity over the past decade.

·  Although the number of new listings is soft compared to last year, inventory levels have gone up to 448 units. With more inventory and lower sales, months of oversupply continue to be elevated at 5 months.

·  Prices for detached homes in February came to $355,200, which is more than 4% lower than this time last year.

Cochrane

·  Residential sales year-to-date compare to 2018 levels due to the gains made in sales of detached homes, for the most part.

·  New listings in the first 2 months compared to the same time last year, however, inventory levels did go up. The months of oversupply stayed just under 7 months.

·  Due to the oversupply, prices year-to-date went down compared to 2018. Year-over-year, benchmark prices in February were $413,300, which was 1.3% below 2018 prices.

Okotoks

·  Sales in January and February 2019 were 30 units below this time in 2018. New listings also softened compared to 2018, which caused inventory levels to go up and months of oversupply to stay elevated at 10 months.

·  Continual oversupply keeps weighing down benchmark prices with February prices at $411,500, representing a 1.3% decline from last month and a 4.6% decline over this same time last year.

 

 

 

Posted in Market Update
Feb. 5, 2019

Calgary Real Estate Market Update - February 2019

January Kicks Off 2019 with Sluggish Home Sales

The economic challenges of 2019 continue into the New Year with Calgary’s housing market still moving at a snail’s pace.

Home sales in January reached only 804 units, which is 16% lower than January 2018 and 21% lower than the long-term January averages.

New listings just coming on the market were comparable in number to 2018, however, those far outnumbered sales. This just added to inventory levels, which led the months of oversupply to reach almost seven months. 

The buyers’ market still persists and is definitely affecting prices. Residential benchmark prices across the city in January softened to $414,800, which is 1% below December figures and 4% lower than January 2018.

 

UPDATES IN THE HOUSING MARKET

Detached Homes

·  Sales of detached homes in Calgary softened by 17% compared to 2018 figures. But, declines were not seen in all districts, with the North East and North West districts showing an improvement in sales activity. The West and North districts experienced the most substantial declines in sales.

·  The number of new listings rose in all districts, with the exception of the South East, North East and North districts. The North East was the only district that recorded a softening in months of oversupply when compared to 2018.

·  Benchmark prices for detached homes came to $476,500, which is a 1% decline from December and more than 4% below January 2018 figures.

·  Prices softened across all of Calgary, with the highest year-over-year declines being seen in the City Centre, North West and South districts.

Condominiums & Apartments

·  The total number of apartments sold in January was 126 units, which is 14% lower than January 2018 and more than 20% lower than long-term January averages.

·  With slower than average sales and fewer new listings, inventory levels softened. Inventory is currently at 1,173 units in Calgary, which is 9% below January 2018.

·  Despite the inventory level adjustment, months of oversupply were at nine months, which has affected prices. Although prices stayed fairly flat compared to December, they went down by 2% when you compare them to January 2018 prices.

·  Prices for condominiums and apartments are still much lower than previous highs, however, in the South East and North East districts, there were some improvements in price compared to 2018.

Attached Homes

·  In January, row and semi-detached homes both experienced a decline in sales. The number of new listings rose at the same time, leading to higher inventory levels for both types of homes.

·  Buyers’ market conditions continue in the attached home sector with prices softening by more than 4% and a benchmark price for attached homes in January of $313,700.

·  Prices for semi-detached homes softened by almost 5% compared to 2018, totalling $393,100. The South and City Centre districts experienced the steepest declines in price, with adjustments of more than 6%.

·  Prices for row homes declined by 4% compared to 2018, totalling $284,300. There were price declines across all districts, but the City Centre experienced the sharpest price declines, with prices almost 8% below last year’s levels. 

 

REGIONAL MARKET UPDATES

 

Airdrie

·  Total sales in January 2019 came to 65 units in Airdrie. This is slightly lower than 2018 sales levels, but comparable to sales activity averages over the last decade.

·  Despite a softening in the number of new listings when compared to January 2018, there was an increase in inventory levels, which brought it up to 422 units. The sales activity combined with higher inventory levels led to the months of oversupply to stay elevated at 6.5 months. The continuing oversupply compared to demand has led to a softening of prices.

·  Prices for detached homes in January came to $354.300, which is 0.5% lower than December’s price and almost 5% below prices in January of last year.

Cochrane

·  Due to Row sales pulling back, sales in January slowed down when compared to 2018 as well as longer-term figures. While this was happening, new listings softened, which led to gains in inventory and the months of oversupply rising to almost 14 months.

·  Because the market is oversupplied, prices are trending down compared to December’s figures. But, when you look at detached benchmark prices year-over-year, the $408,600 price was fairly stable when compared to price levels in January 2018.

 

Okotoks

·  January sales activity in Okotoks was down compared to January 2018. Although the number of new listings that came on the market in January also declined from 2018 levels, the number of new listing far exceeded the number of sales, which led to a rise in inventories and months of oversupply to continue above 10 months.

·  With the problem of continuous oversupply, benchmark prices remain lower having declined for the third consecutive month. Prices for detached homes in January came to $416,900. This is 1% below last month’s benchmark prices and 3% lower than in January 2018.

 

 

 

Posted in Market Update
Jan. 7, 2019

Calgary Real Estate Market Update - January 2019

Oversupply Continues to Affect the Housing Market in Calgary

 

Home prices in Calgary were down 1% in December compared to November and are more than 3% below December 2017, due to the ongoing oversupply.

Sales came to a total of 794 units in December, which is a stark 21% decline over December figures last year. Year-to-date home sales in Calgary were 16,144 units. This represents a 14% decline from 2017 and an almost 20% decline when you look at long-term averages.

The number of units in December’s inventory was 4,904, which is much higher than last year at this time and 30% higher than levels typically seen in December. Higher resale inventories last year resulted from gains in the sale of detached and attached homes.

The months of oversupply stayed elevated during all of 2018, averaging 5.2 months. This was a contributing factor on the annual average decline in the benchmark price of 1.5%. Sales figures throughout Calgary to remain more than 9% lower than the recorded monthly highs of 2014 due to price declines across all types of housing.

Tom Westcott, president of CREB® said, “Anyone buying or selling a home in Calgary this past year had to adjust his or her expectations. Sellers had to face the fact that the resale market offered more choice, plus they had to compete with the new-home market.”

 

UPDATES IN THE HOUSING MARKET

Detached Homes

·  Sales of detached homes declined throughout Calgary in 2018, with a total of 9,945 units being sold. This level of activity is 21% below what would be typical for the year.

·  Inventories of detached homes remained higher than 2017 levels and this was the reality every single month of 2018, including December. A slowdown in sales resulted in the oversupply in the market throughout the year.

·  Benchmark prices in December for detached homes came to $481,400, which was 1% lower than in November and 3% lower than in 2017. Overall, prices declined in 2018 by 1.5% when compared to 2017. 

·  Detached home prices in 2018 have softened in most districts with the largest declines occurring in the North, North East and North West districts.

 Condominiums & Apartments

·  Sales of condominiums and apartments in 2018 came to a total of 2,663 units. Although the decline is not as steep as other types of housing experienced, levels are still 22% lower than long-term averages.

·  Sales in this sector have been hampered with oversupply for nearly three years and this situation continued in 2018.

·  However, the oversupply situation has been letting up since 2018 inventories averaged 1,584 units, which is 1% lower than 2017 levels.

·  While supply growth slowed down, the market continued to be oversupplied, which led to further declines in price. Benchmark prices for condominiums and apartments were $251,500 in December, which was more than 2% lower than in 2017. Annually, we saw a decline of nearly 3%, contributing to a total decline in prices of 14% since 2014.

·  Price declines in 2018 have gone from a high of almost 6% in the East district down to a 2% low in the North West and City Centre districts.

 Attached Homes

·  There were declines in sales for row as well as semi-detached homes, which resulted in sales of attached homes totalling 3,536 units in 2018. This represents a decline of 15% over 2017 and was 14% lower than long-term averages.

·  Due to the slowdown in sales activities, there were fewer new listings, however, this affected the row sector only. New listings for row homes declined by 4% and new listings for semi-detached homes were up by almost 15% in 2018.

·  Despite some new listing adjustments, inventory continued to be elevated, which means it remained a buyers’ market and that means prices being pressed downward.

·  The benchmark price for semi-detached homes in December came to $397,500. This represents a monthly decline of 0.8% and a year-over-year decline of 3.8%. Due to recent price declines, the gains made in this sector last year have been eliminated with 2018 prices slightly lower than 2017 levels. At the end of the year, 2018 prices were 1.4% lower than peak levels in 2014.

·  Prices for row homes are continuing to soften. Row prices in December were $288,400, which is a 1.5% decline from November and almost 4% lower than 2017 levels. At the end of the year, 2018 prices were 2% lower than 2017 levels and almost 10% lower than previous highs.

 

REGIONAL MARKET UPDATES

Airdrie

·  The housing market in Airdrie throughout 2018 suffered from oversupply and indications of a buyers’ market. Compared to 2017, inventory levels and the number of months of oversupply have been much higher. When you combine this with fewer sales the result was a lower benchmark price when it came to detached homes.

·  Annual sales of residential homes experienced a 14% year-over-year decline and were nearly 19% lower than sales over the previous 5 years. This continuous decline affected all types of homes.

·  2018 experienced record highs when it came to supply levels. The number of new listings marked a new peak year-to-date for most of 2018. Inventories continued to increase throughout 2018 and are 12% higher than was seen in 2017. The number of months of oversupply went up steadily, averaging 5.6 months for the year.

·  This continuous oversupply situation has caused Airdrie home prices to decline. Benchmark prices for detached homes in 2018 averaged $369,042, which was more than 2% lower than in 2017.

 Cochrane

·  2018 home sales in Cochrane declined by 64 units, which was below 2017 levels. But, yearly sales of 599 units is comparable to sales activity over the previous 3 years.

·  Cochrane experienced 1,288 new listings in 2018, which was a record high. More new listings and softening sales caused a rise in inventory levels and months of oversupply averaging almost 7 months.

·  Higher supply levels has led to prices of detached homes to move down during the last two quarters of 2018, but not enough to offset gains made earlier in the year. Benchmark prices for detached homes in 2018 have remained comparable to 2017.

 Okotoks

·  Residential home sales in 2018 in Okotoks totalled 463 units, which represents a decline over 2017 and actually compares to 2010 sales. 

·  New listing gains, along with a slowdown in sales cause inventory levels to rise, which means an oversupply in the market.

·  Despite the oversupply and soft sales, prices for detached homes in Okotoks showed slight increases in 2018. The average benchmark price for detached homes came to $434, 875, a 1% increase over 2017.

 

 

 

Posted in Market Update
Dec. 6, 2018

Calgary Real Estate Market Update - December 2018

Challenging Economy Continues to Affect the Resale Market

Sales in Calgary for November came to 1,171 units, which is lower than long-term averages.

So far this year sales have reached 15,349 units, which is a 14% decline over 2017 figures and nearly 20% lower than long-term averages.

Ann-Marie Lurie, CREB® chief economist said, “Consumer confidence has waned over the last month due to the challenges facing the energy sector. When you combine that with weak employment and lending rates that continue to grow, it’s not surprising that ownership demand has softened.”

New listings in November eased by 7% compared to this time last year. The downturn in new listings does help to prevent further gains in inventory. There are currently 6,501 total units in inventory, however this is far more than the 5,683 units that were in inventory at this time last year and 32% higher than normal levels for the month of November.

Lurie added, “With more supply and weaker sales a buyer’s market continues in Calgary, which just causes prices to decline even more.”

In November the benchmark price across the city was $422,600, which is almost 1% lower than October’s and more than 3% lower than last year at this time.

Sales have slowed in all price ranges year-to-date, except for homes priced under $200,000, which currently makes up 6% of all sales. The largest sales decline is being experienced in the $600,000 to $999,999 price range.

Tom Westcott, CREB® president said, “In any market, you need an affordable product if you expect steady sales.”

He added, “The good news is that buyers may be able to buy a home that they could never have imagined affording in the past. Sellers must stay up-to-date on what is actually selling, in their own neighbourhood as well as in surrounding areas.”

UPDATES IN THE HOUSING MARKET

Detached Homes

·  Sales for detached homes in November were down across all districts. Sales in all of Calgary were 679 units, a 21% decrease in activity compared to a typical November.

·  The number of new listings went down 3% when compared to this time last year. Declines in the North, North East and South East districts were what pulled the figures down for the most part. New listings year-to-date in 2018 have gone up in all districts, except the East and North East.

·  The detached home sector inventories totalled 3,491, which is 26% higher than 2018 levels at this time. There has been five months of supply at this point, far more than the three-month usual for the month of November.

·  Benchmark prices in November for detached homes came to $486,000, which is 1% less than October’s figures and 3% lower than this time in 2017. This comes to almost 7% lower than the monthly highs on record for October 2014. 

·  The detached home sector inventories totalled 3,491, which is 26% higher than 2018 levels at this time. There has been five months of supply at this point, far more than the three-month usual for the month of November.

·  Benchmark prices in November for detached homes came to $486,000, which is 1% less than October’s figures and 3% lower than this time in 2017. This comes to almost 7% lower than the monthly highs on record for October 2014. 

·  Prices have softened clear across Calgary in November. Year-to-date, the largest declines have been in the North and North East Districts. This has very likely been caused by the competition created by the new-home sector. The South and North West are the two districts furthest from any kind of price recovery.

Condominiums & Apartments

·  Despite November’s year-over-year gains, condominium and apartment sales citywide have only come to 2,557 units up until now. This is 5% below last year’s figures and 21% lower than long-term averages.

·  Most of the condominium activity is in the City Centre and makes up 48% of all sales.

·  After years of oversupply, new listings for apartments continues to soften, which helps prevent additional large gains in inventory levels and even helps reduce inventories in the East, North East and South districts.

·  Despite some fluctuation in inventory levels, most districts still grapple with oversupply, leading to price declines, which have ranged this year from almost 6% in the East district down to just 2% in both the North West and City Centre districts.

Attached Homes

·  Sales of attached homes came to 3,344 units year-to-date, which is a 16% decline over 2017 and 14% lower than long-term averages. Across most of Calgary there was a softening of sales activity, apart from the North East district where sales continued to be relatively steady due to improved row activity.

·  For the most part, the rise in new listings continues to push inventory levels higher and these gains are mostly in semi-detached homes.

·  The oversupply situation has depressed prices. The benchmark price for semi-detached homes in November came to $400,700. This represents a 0.67% monthly decline and a 3.3% year-over-year decline. Recent declines in price have eliminated any gains that occurred in this sector last year. Year-to-year prices compare closely with figures in 2017.

·  Row prices are also inching down, but not as quickly as the prices of semi-detached homes. Row prices in November were $292,900, which is a 0.2% decline from October and a little more than 3% lower than 2017 levels. For the most part, year-to-date prices are still almost 2% lower than last year’s prices and almost 10% lower than previous highs.

REGIONAL MARKET UPDATE

Airdrie

·  The housing market in Airdrie is still declining in sales, while inventory continues to rise. The perpetual oversupply has caused a decline in benchmark prices for detached homes. 

·  Sales activity so far this year in Airdrie has gone down by 142 units year-over-year, with sales currently at 1,101 units. New listings so far in 2018 compare to 2017, but are still higher than recorded long-term averages.

·  So far this year the average inventory is nearly 18% higher than at this time last year, maintaining the average months of oversupply at approximately six months. The persistent pressure has caused house prices to decline, with the benchmark value year-to-date of detached homes now at $342,773, representing a decline year-over-year of almost 2%.

Cochrane

·  Sales of residential homes in Cochrane year-to-date have gone down 58 units, making the total units sold so far this year 573. These levels compare to other similar times in the past several years and are actually represent an increase in long-term averages.

·  New listings keep on reaching historical highs for each period so far this year. New Listing levels in 2018 so far are 308 units, which actually represents an increase in long-term averages. Average inventory levels so far this year are 14% higher than at the same time last year.

·  Despite recent declines, benchmark prices for detached homes year-to-date have remained steady when you compare them with last year’s prices.  

Okotoks

·  Sales of residential homes year-to-date have declined to just 449 units, which is similar to 2010 levels.

·  New listings are still a bit higher than in 2017. Oversupply continues in Okotoks, with average inventories so far this year at 53 units higher than at this time last year.

·  Despite weak sales and increased supply, prices for detached homes in Okotoks show slight increases. The average benchmark price for detached homes year-to-date came to $436,091, which is 1.5% higher than 2017.

 

 

 

Posted in Market Update
Nov. 5, 2018

Calgary Real Estate Market Update - November 2018

Calgary’s Struggle with Oversupply Causes Home Prices to Soften

Prices are softening in Calgary’s housing market due to an elevated inventory when compared to sales.

Benchmark prices across the city in October came to $426,300, which indicates a downward trend for the fifth straight month. The year-over-year result shows a 2.9% decline. 

Anne-Marie Lurie, chief economist for CREB® said, “Job growth in Calgary is still a worry, as the level of unemployment is still far higher than anyone expected for 2018. The rising cost of home ownership continues to have a detrimental effect on housing demand.”

“Simultaneously, supply levels haven’t adapted quickly enough to these conditions, which has caused prices to soften.”

Inventories totalled 7,345 in October, whereas sales came to just 1,322. The result is months of supply at 5.6, which is not at all typical for October. Although some softening in the growth of new listings will prevent more supply gains, inventory levels for October remained at near record highs for this month of the year. 

Tom Westcott, president of CREB® said, “Under these market conditions, a lot of potential homebuyers should have a good chance of finding the home they want in their price range if the homes are priced right.” He added that, “Sellers need to have realistic expectations and have up-to-date data from the correct sources so that they know what’s selling and what isn’t in their neighbourhood.”

In each property type, sales have improved if you look at homes priced in the lower ranges, which means that most of those segments are in relative balance. However, in the upper price ranges there have been huge gains in supply when compared to demand. This is bound to have a stronger impact on prices in the upper ranges.

UPDATES IN THE HOUSING MARKET

Detached Homes

·  In October sales of detached homes totalled 829 units, indicating an 8.6% decline, which means a 15% year-to-date decline. This shows that detached sales are moving at the slowest level since the late 1990s.

·  Year-to-date, the strongest sales decline was in the $600,000 to $999,999 price range, which reflects a low demand from buyers moving up.

·  For two months in a row now, there has been a softening of new listings, which does prevent additional gains in inventory. However, since this segment is still oversupplied, the downward trend in prices will continue.

·  Benchmark prices in October for detached homes totalled $490,000. This is lower than last month and 3% lower than levels this time last year. Year-to-date, prices are 1% lower than levels this time last year.

·  Year-over-year prices as of October have softened across all districts, but the strongest declines are in the South, South East, North East and North West districts. This is probably the result of the new-home sector creating some competition.

Condominiums & Apartments

·  Year-to-date sales of apartments totalled 2,316 units, which is almost 7% lower than this time last year. New listings have softened by 6%, which does help to lower inventory levels in the market.

·  Despite inventory softening, the months of oversupply remains too high at 7 months.  

·  Year-to-date prices of condominiums and apartments have softened by 2.8% and are still 14% lower than 2014 highs. Prices declined across all districts, with the strongest declines in the South, East and North East districts.

Attached Homes

·  Year-to-date sales of attached homes were at 3,098 in October. This is 15% lower than this time last year and 14% lower than long-term averages.

·  In the meantime, despite the recent slowing in new listings, inventories for October were at the highest level ever recorded.

·  The oversupply is having a detrimental affect on the semi-detached as well as the row sectors. Both have experienced a downward trend in prices over the last 5 months.

·  Year-to-date benchmark prices for the row sector are averaging $298,140, which is almost 2% lower than last year at this time and 9% lower than previous highs. But, prices have stayed relatively flat in the North West and City Centre districts.

·  Prices for semi-detached homes in October were at $403,400, which is 1% below last month and almost 3% below this time last year. Despite recent price declines, year-to-date prices citywide stayed comparatively flat when you consider last year. This was primarily due to the gains in the North East, East and City Centre districts, which offset the declines occurring in the South, South East and North West.

REGIONAL MARKET UPDATE

Airdrie

·  In comparison with last year, the housing market in Airdrie continues to suffer from declines in sales and increases in inventory. Oversupply has led to the softening of benchmark prices in the detached-home sector.

·  Year-to-date sales for residential homes now totals 1,032 units, which is 11% lower than levels this time last year. New listings year-to-date have stayed relatively stable, but are still substantially more than long-term averages.

·  Average inventory levels year-to-date are 19% higher than this time last year. This has resulted in months of elevated oversupply that now stands at 6 months, causing relentless pressure on the benchmark price. The year-to-date of homes in the detached sector is now at $370,888, a year-over-year decline of almost 2%.

Cochrane

·  Sales of residential homes year-to-date have declined by 10%, with just 530 residential homes sold thus far in 2018. This is similar to other times in the past several years, but it is more than long-term averages.

·  New listings were at 1,164 in October, which is historically a peak for this time of year and well more than long-term averages. Inventory levels this year in Cochrane have continued to be elevated and are nearly 17% above this time last year.

·  This has begun to soften prices. But, year-to-date benchmark prices for detached homes have stayed relatively stable at $424,900 as compared to 2017.  

Okotoks

·  Year-to-date sales of residential homes have dropped to 428 units this far in 2018, which compare to 2011 levels and are far lower than long-term averages.

·  New listings were at 936 in October, which is 8% higher than this time last year and comparable to long-term averages. October inventory levels stayed elevated at 232 units.

·  Despite supply gains when compared to sales, the prices for detached homes in Okotoks have shown modest gains. Benchmark prices year-to-date for detached homes totalled $436,660, which is 1.25% higher than this time last year.

 

Posted in Market Update
Oct. 16, 2018

Things I wish I knew: Sellers Edition

 

Whеn уоu dесіdе to ѕеll уоur home, уоu nееd tо know thаt thеrе іѕ mоrе tо іt than ѕіmрlу рlаntіng a "For Sаlе" sign оn your lаwn. Yоu'll need tо соnѕіdеr all thе factors thаt wіll hеlр to еnѕurе thаt уоu have a ѕuссеѕѕful sale. Thе thought of ѕеllіng thе home yourself might ѕоund арреаlіng whеn уоu think оf thе savings thаt you саn make, but you nееd tо determine if thіѕ іѕ thе bеѕt dесіѕіоn.

Whеn beginning thе рrосеѕѕ of selling уоur home, normal ԛuеѕtіоnѕ like how tо gеt thе bеѕt price for mу рrореrtу and whеthеr оr not tо uѕе a real еѕtаtе agent іmmеdіаtеlу come to mind fоr most ѕеllеrѕ. Whеthеr you're a first tіmе home seller or a ѕеаѕоnеd hоmе selling veteran, thе process of ѕеllіng a hоmе will inevitably bе сhаllеngіng аnd complex. However, the bеѕt рlаn fоr аnу home seller іѕ tо рrераrе a home ѕеllіng ѕtrаtеgу bеfоrе рuttіng a hоmе оn the mаrkеt. There are thіngѕ to соnѕіdеr when making this important dесіѕіоn.

1) Whаt аrе thе current conditions оf the local market?

The mаrkеt is іn a constant ѕtаtе оf сhаngе. Things аrе always еіthеr hеаtіng uр оr cooling оff. Thіѕ fluctuation іѕ саuѕеd bу economic factors, ѕеаѕоnаl changes, and supply v/ѕ dеmаnd. I lіkе tо uѕе a thеоrу knоwn аѕ thе "slightly less/slightly mоrе" pricing ѕtrаtеgу. When thіngѕ are in a ѕtаtе оf dесlіnе, your рrісе must bе bеttеr thаn thе соmреtіtіоn. When things аrе grоwіng, уоu may bе able to sell your hоmе at ѕlіghtlу mоrе than оthеr rесеnt transactions.

2) How mаnу other properties wіll уоur hоmе be іn соmреtіtіоn аgаіnѕt?

If you can find the same home dоwn thе street, what аrе you оffеrіng thаt the оthеrѕ are nоt? Every home іn уоur neighbourhood іѕ іn соmреtіtіоn against thе rеѕt. Whеn уоu аrе priced bеlоw the соmреtіtіоn аnd the newest оn the mаrkеt, you hаvе thе greatest chance оf selling уоur hоmе ԛuісklу. Whеn tіmе іѕ not a сrіtісаl factor, уоu mау bе аblе tо set the home аt a dіffеrеnt price knоwіng that уоu аrе prepared tо wаіt until thе rіght buуеr соmеѕ with the right оffеr.

3) Dо уоu have аnу known рrоblеmѕ in thе home?

Knоwn problems should аlwауѕ bе rеѕоlvеd as soon as роѕѕіblе. Nоt оnlу will they become an іѕѕuе for you whеn thе іnѕресtіоn іѕ done but these іѕѕuеѕ соuld get wоrѕе and ultіmаtеlу соѕt уоu mоrе mоnеу. Knоwn іѕѕuеѕ іn thе hоmе ѕuсh as ѕtruсturаl рrоblеmѕ, leaks in the roof, еtс... muѕt bе dіѕсlоѕеd оn thе disclosure ѕtаtеmеnt if thеу аrе асtіvе problems. Get these things fіxеd today.

4) Is your home рrераrеd fоr a vіѕіt оn аn hоur'ѕ notice?

Gеt іntо thе hаbіt of leaving уоur home in vіѕіt rеаdу соndіtіоn еvеrуdау. Vіѕіt rеаdу wоuld іnсludе beds bеіng mаdе, carpets vacuumed, dіѕhеѕ сlеаnеd аnd рut away, lаwn іn оrdеr, blіndѕ opened, сlоthеѕ рut away, еtс... However, trу nоt tо worry about еvеrу little dеtаіl. On thе first visit tо a hоmе most buуеrѕ аrе juѕt lооkіng fоr gеnеrаl things ѕuсh as flооrрlаnѕ, еxtеrіоr features and gеnеrаl condition. Whеn a buуеr wants to dо a ѕесоnd wаlk thrоugh, the hоmе must bе іn іtѕ best possible соndіtіоn. Buуеrѕ wіll analyze every роѕѕіblе dеtаіl ѕіnсе thеу hаvе nоw become very іntеrеѕtеd іn роѕѕіblу рurсhаѕіng уоur hоmе. Tурісаllу, уоu wіll hаvе a lоngеr аdvаnсеd nоtісе fоr a ѕесоnd visit. Mаkе іt соunt.

5) Make a hоmе selling plan beforehand:

Prior tо rераіrіng and ѕtаgіng your home fоr ѕаlе оr making a ѕсhеdulе fоr аn ореn hоuѕе, іt wоuld bе a ѕmаrt dесіѕіоn to create a hоmе selling plan bеfоrеhаnd. Just lіkе іn buying a home, selling your property саn bе an оvеrwhеlmіng mоmеnt fоr аnу реrѕоn thеrеfоrе it is important thаt уоu сrеаtе a well-planned selling ѕtrаtеgу to make ѕurе that уоu gеt thе mоѕt from your property.

 

Thеѕе are juѕt some оf the major thіngѕ уоu оught tо know or bе thіnkіng about when рlаnnіng to sell your house.  For more information you can check out our Ultimate Marketing Plan or just give us a call and we can answer all your questions. 

Oct. 5, 2018

Sluggish Economy and Housing Oversupply Lead to Buyer’s Market

 

With no discernable changes in the economic picture, the sales in Calgary for September came to 1,272 units, which is 13% less than 2017, and far below the years-long averages. Across all housing types, there was a distinct pullback, especially in the detached market.

Ann-Marie Lurie, CREB® chief economist noted Calgary is still struggling with unemployment, which was up 8% in September. Concerns about the continued unemployment, higher interest rates and a lack of economic confidence are depressing the housing market.

“While unemployment continues to be a problem, supply levels remain high, causing an ongoing oversupply and declining prices.”

Inventories reached 7,941 units, which means the months of oversupply is now at 6.25. The longer this goes on the more the oversupply will depress prices. The unadjusted benchmark price citywide came to $428,700 in September. This figure is almost 1% lower than August and 3% lower than this time last year.

Tom Westcott, CREB® president said, “This has become the new normal for real estate in Calgary.”

“A number of potential buyers may be motivated to take advantage of the current market conditions, but they will no doubt confront difficulties when they try putting their existing home on the market at a price they would accept. In most cases, unless homeowners can sell the home they currently live in they won’t be able to purchase a new one.” 

Sales in September were down, but third-quarter numbers seem to indicate a slower sales decline and fewer new listings. Even so, these factors were not enough to affect inventory levels this past quarter.

While the economy in Calgary struggles, there are some indications that the rental market is improving and this could contribute to a slow decrease in the housing supply overall.

UPDATES IN THE HOUSING MARKET

Detached Homes

·  Year-to-date sales limped to 7,945 units, which was 20% lower than the 10-year average. Sales were soft across all price ranges, but not for properties that sold for less than $300,000, which showed a modest gain.

·  Soft sales met up with some new listing adjustments in September. Unfortunately, inventories are still too high and in most districts the oversupply is more than long-term averages.

·  Months of oversupply reached 5.5 months in September and this factor causes a softening of housing prices across all districts.

·  Benchmark prices for detached homes came to $493,100 in September. This amounts to a decline of 0.8% over the previous month and 3% below 2017.

·  Prices inched downward in most districts in September. However, when you look at year-to-date figures, benchmark prices are still higher than last year in the West districts and City Centre.

Condominiums & Apartments

·  The condominium and apartment sector has experienced the slowest sales decline at 6% so far in 2018. Similar to the detached sector, sales remain more than 20% below long-term averages at a total of 2,103 units.

·  For four months running, new listings have been inching lower than these months last year. This has reduced inventory in this market somewhat compared to 2017.

·  However, even with inventory a bit lower, this is still a buyer’s market when you consider the lower sales numbers.

·  When there is more supply than demand, which was the case in the condominium and apartment sector, benchmark prices softened in September, with a decline of 0.4% over the previous month and 2.7% when compared to 2017.

Attached Homes

·  The year-to-date sales recorded for the attached sector came in at 2,814 units. This figure is 15% lower than 2017 and 14% lower than long-term averages.

·  With no real lowering of new listings, inventory continued to be elevated, leading to more than 7 months of oversupply.  

·  Elevated supply when compared to demand continued to be the case in both row and semi-detached homes. Like every other sector, the oversupply has softened prices across all districts, save for North East, East and the City Centre.

·  While the benchmark prices softened in September for semi-detached homes, year-to-date prices were still higher than 2017 levels. The oversupply in recent months has eroded some of the progress made towards price recovery in 2017.

·  Benchmark prices for row homes have been at an average of $298,667 so far this year, which is nearly 2% below 2017 and 9% lower than previous highs. Despite the pullback across the city, row prices have stayed relatively stable in the South East and North West districts and the City Centre.

REGIONAL MARKET UPDATE

Airdrie

·  The housing market in Airdrie has so far this year been in a buyer’s market. This can be attributed to a weak economy, which has hindered any growth in demand. This won’t help to alleviate the oversupply and has led to a softening of benchmark prices in the detached home sector.

·  Residential sales year-to-date in Airdrie have gone down when compared to 2017 and remain at levels similar to those in 2012. In the meantime, new listings have stayed elevated, which in turn caused inventories for September to reach new highs.

·  Months of oversupply have continued to soften prices. The benchmark price year-to-date for detached homes averaged $371,244, which shows a 1.7% decline from last year and is 5% lower than previous highs.

Cochrane

·  Due to a similarly weak economy, the Cochrane housing market has been experiencing a slight supply-side imbalance.

·  Year-to-date sales in Cochrane were 477 units, which was 59 units lower than last year. Growth in sales has been decreasing for most of this year. However, 2018 levels are still higher than in 2015 and 2016.

·  New listings have been continuing to grow in Cochrane for most of 2018 and year-to-date numbers show 269 units more than long-term averages. Inventories have reached a new high for September, peaking at 360 units, which only leads to months more of elevated supply.

·  Due to the persistent oversupply, prices are softening in the third quarter. However, not enough to wipe out earlier gains. This leaves benchmark prices year-to-date a little higher than last year’s levels. So far in 2018, prices for detached homes remain 4% lower than recent highs.

Okotoks

·  Okotoks is also undergoing supply pressures due to slow sales and an increase in new listings.

·  Despite the oversupply, benchmark prices in the third quarter have remained relatively stable when compared to last quarter. The year-to-date benchmark price for detached homes is at $436.422, which is almost 1% higher than 2017, but still 3% lower than previous highs.

 

 

 

Posted in Market Update
Sept. 5, 2018

Calgary Real Estate Market Update - Sept 2018

High Rate of Unemployment is Slowing Recovery in Housing Market

CALGARY – The city’s housing market continues to suffer from oversupply due to an uptick in new listings and an easing in sales. These factors continue to be a drag on the housing market recovery.

Persistently high inventory levels in the Calgary market continued to pull prices down in August. Benchmark prices across the city dropped 0.8% over previous months, which mean they are 2.4% lower than last year’s price levels.

Ann-Marie Lurie, CREB® chief economist said, “The unemployment rate in Calgary has been persistently high at 7.9%, plus the city has recently been suffering an increase in the loss of full-time jobs. Unemployment is just one of the factors affecting the local housing market.”

“Other factors include stricter lending conditions, the energy sector being slow to recover, and the competition being faced by the new home sector.”

Sales across the city in August totalled 1,490 units, which was nearly 7% down from this time last year and 14% lower than long-term trends.

Declines in sales and prices were inconsistent across all housing types and districts. Prices have been going down recently across most areas of the city when you examine year-to-date numbers, but remained similar to last year’s prices in the West districts and the City Centre.

Tom Westcott, CREB® president said, “Buyers and sellers alike must be realistic about the situation and their objectives. Buyers have to understand that price changes will depend on what type of home it is and its location. Just because sales have been declining, you cannot assume that prices will go down across the board.”

“If sellers expect to compete they must be well informed. They need to know what’s been selling in their neighbourhood and how well their home and property compares to those that have sold.”

UPDATES IN THE HOUSING MARKET

Detached Homes

·  Year-to-date sales of detached homes slowed down in each district. Inventory levels remained high for nearly five months by August, which continued to drag down prices in all districts.

·  Benchmark prices for detached homes reached $497,000 in August. This represents a 0.74% decline over July, which is 2.6% lower than in 2017.

·  Across all districts prices trended down in August, but when you examine year-to-date figures they remain higher than 2017 in both West districts and City Centre.

·  Average benchmark prices year-to-date for detached homes have gone down 0.56% over last year, which reduces some of last year’s price recovery.

Condominiums & Apartments

·  Sales year-to-date came to 1,892 units, which is 7% lower than 2017. However this was not prevalent across all districts. In fact, North East and North West district sales were a bit higher than sales levels were last year.  

·  New listings slowed down in the apartment sector compared to 2017, which prevented higher gains in supply. However, inventory levels persistently remain high in this sector, which just leads to more declines in price.

·  Citywide prices have gone down by nearly 3% year-to-date, with the most significant declines occurring in the South, East and North East districts. All in all, prices are now almost 14% lower than the highs of 2014.

Attached Homes

·  Sales have also slowed down in the attached sector. However, there is some good news in that year-to-date sales in the West and North West districts for row houses and semi-detached homes have improved.

·  Sales of row houses have remained fairly consistent in the East and North East districts.

·  The semi-detached sector has been suffering from oversupply, which has pushed prices downward this year, but the average benchmark price year-to-date is still higher than 2017 in the City Centre, East and North East districts. These gains proved enough to offset the declining prices in other areas of the city. Overall, prices for semi-detached homes were 1% higher year-to-date than last year.  

·  Year-to-date prices for row homes are down 1.5% over 2017. However, prices have not been moving consistently across the city. Prices have been fairly stable in the North West and City Centre while declining nearly 7% in the North East district.

REGIONAL MARKET UPDATE

Airdrie

·  Sales in Airdrie have continued to soften when compared to 2017, with just 851 units being sold so far in 2018.

·  While there have been fewer new listings in recent months, new listings so far this year remain slightly above last year’s, with inventories at 597 units.  

·  The perpetual oversupply in the housing market has started to bring home prices down. Average prices for detached homes were $366,990, which is 0.7% lower than last month and 3.4% lower than last year. The benchmark average price year-to-date is 1.5% lower than last year’s levels.

Cochrane

·  Home sales year-to-date in Cochrane are at 431 units, which represents a decline over last year. However, sales activity does compare to recorded sales activity over the last five years. This shows that Cochrane has not experienced the same reduction in demand that other areas are experiencing.

·  The challenge facing Cochrane is the continuous rise in inventory. New listings are on the rise and at a level that is above normal for the area. Inventories are at new highs and supply just continues to rise.

·  The continued oversupply is now starting to have an adverse affect prices. Benchmark prices for detached homes dipped down to $426,100 in August, which was lower than in July. Despite the recent softening, prices in Cochrane overall remain comparable to average prices year-to-date in 2017 and for the month of August.

Okotoks

·  Inventory levels have risen to 280 units in Okotoks due to a softening in sales and an increase in new listings. 

·  The recent increases in inventory, along with fewer sales have begun to adversely affect prices in the area. Despite these factors, the softening was not enough to bring year-to-date prices below 2017 levels.

·  Average benchmark prices for detached homes are $436,350 year-to-date, which is slightly higher than 2017 levels. 

Posted in Market Update
Aug. 8, 2018

3 Ways a School Division Can Influence Your Resale Value

Welcome to Awesome August!

When you purchased your home, you had a list of things you wanted. Maybe it was the backyard, perhaps the kitchen. For almost 90% of potential homebuyers, school divisions play a large role in their decision.

For those that have children, it goes without saying that you want a good school for them. But for those that don’t, the decision to buy in a good school division is often tied to the resale value. Often the quality of the school changes over the course of 10 to 15 years, and if you don’t have daily interaction with the school, you may not even realize the impact it could have on selling your home.

Here are three ways a school division can influence your resale value:

1: Increased Spending Habits

A good school division may be an indication of other positive things in the area, including the efficiency of local government and spending. The National Bureau of Economic Research discovered that “for every dollar spent on public schools, home values increased by $20.” Increased home values are beneficial for everyone in the area.

2: Positive School Ratings

A 2013 realtor.com survey of nearly 1,000 prospective home buyers showed that 91% said school boundaries were an important factor in their home search. Statistics also show that the more affluence there is in a community, the higher the test scores will be in that same community, thus making the location more desirable.

3: Bigger Homes

Interestingly, higher-scoring schools tend to be in areas with bigger houses. Homes in higher-scoring school zones tend to have about 1.5 more rooms than homes in nearby lower-scoring schools. While more rooms can certainly increase home values, 1 in 5 home buyers are willing to sacrifice space, bedrooms, and garages to buy a house in a good school division.

But before you get too caught up on test scores, school rankings, and bedrooms there are a few additional things to take into consideration when buying or selling a home:

• Overall, buyers are willing to pay more for a home in a good school division

• 1 in 5 said they would pay between 6 to 10% more for a home in a good division

• 1 in 10 said they’d pay up to 20% more for a home in their desired school division

Don’t get overwhelmed with all the numbers and statistics. Together, we can do some research to determine the appeal of your school division and how it may affect the sale of your home.

If you would like to learn how your school division affects your specific home value, and benefit you financially, call me at 403-919-2247 to schedule a time to talk.