Calgary Housing Market in a Period of Correction
City of Calgary sales wane as town and country sales hold steady
Calgary, September 1, 2010 – Home sales in the city of Calgary continued to trend lower in the month of August, according to figures released today by the Calgary Real Estate Board (CREB®).
The number of single family homes sold in August 2010 in the city of Calgary was down 32 per cent from the same time a year ago, and condominium sales saw a decrease of 42 per cent from the same time a year ago.
August 2010 saw 867 single family homes sold in the city of Calgary. This is a decrease of 5 per cent from 915 sales in July 2010. In August 2009, single family home sales totalled 1,277. The number of condominium sales for the month of August 2010 was 364. This was a decrease of 8 per cent from the 396 condominium transactions recorded in July 2010. In August 2009, condominium sales were 632.
“Calgary’s housing market has been undergoing a measured correction over the past 4 to 5 months. Sales are trending lower as a result of a decrease in first time home buyers entering the market and a decline in pent up demand following a strong post-recession recovery,” says Diane Scott, president of CREB®.
“There has been much talk recently about the potential for a housing bubble in Canada--but the economic fundamentals at play make this scenario unlikely for Calgary. What we are seeing is an adjustment to higher levels of inventory and a shift to a buyer’s market.”
“A slower than anticipated pace of mortgage rate hikes and continued improvements in employment are more likely to bring stability rather than volatility into Calgary’s housing market as we move into 2011,” adds Scott.
The average price of a single family home in the city of Calgary in August 2010 was $445,617, showing a 4 per cent decrease from July 2010, when the average price was $464,655, and a decrease of 2 per cent from August 2009, when the average price was $454,130. The average price of a condominium in the city of Calgary in August 2010 was $286,384, showing a 2 per cent decrease from July 2010, when the average price was $291,168 and a 1 per cent increase over last year, when the average price was $283,330. Average price information can be useful in establishing trends over time, but does not indicate actual prices in centres comprised of widely divergent neighbourhoods, or account for price differentials between geographical areas.
“We expect a period of correction will continue into the fall of this year. Prices may sag in the short-term and level off as we move into 2011,” says Scott.
“Homebuyers and sellers should keep in mind that market trends are unique even throughout the wider Calgary region. A case in point is the relative strength of Calgary’s town and country market, where sales have remained at 2009 levels. Homebuyers and sellers should speak to a REALTOR® to better understand the opportunities in our current market,” says Scott.
The median price of a single family home in the city of Calgary for August 2010 was $395,000, showing a 1 per cent decrease from July 2010 and August 2009, when the median price was $400,000. The median price of a condominium in August 2010 was $260,000, showing a 3 per cent decrease from July 2010, when the median price was $268,000, and no change from August 2009, when it was the same – $260,000.
All city of Calgary MLS® statistics include properties listed and sold only within Calgary’s city limits. The median price is the price that is midway between the least expensive and most expensive home sold in an area during a given period of time. During that time, half the buyers bought homes that cost more than the median price and half bought homes for less than the median price.
Single family listings in the city of Calgary added for the month of August 2010 totalled 1,960, an increase of less than 1 per cent from July 2010 when 1,942 new listings were added, and showing an increase of 3 per cent from August 2009, when 1,910 new listings came to the market.
Condominium new listings in the city of Calgary added for August 2010 were 808, down 9 per cent from July 2010, when the MLS® saw 890 condo listings coming to the market. This is a decrease of 3 per cent from August 2009, when new condominium listings added were 832.
“Total month end inventory for the wider Calgary region is down marginally when compared to July—a trend we expect will continue in the coming months. New listings are also likely to recede in the coming months in response to slowing sales,” adds Scott.
CREB® is a professional body of 5,540 licensed brokers and registered associates, representing 245 member offices and is dedicated to enhancing the value, integrity and expertise of its REALTOR® members.