Calgary region to see MLS sales and prices rising for next two years

CMHC report says average price to hit $434,000 in 2014

By Mario Toneguzzi, Calgary Herald February 22, 2013

 

CALGARY — The Calgary region can expect to see increases in both sales and average MLS prices for the next two years, according to a housing forecast released Friday by Canada Mortgage and Housing Corp.
The agency said sales in the Calgary census metropolitan area will grow by 1.37 per cent this year to 27,000 units followed by another 2.59 per cent growth in 2014 to 27,700 transactions.
The average sale price is expected to rise by 2.59 per cent this year to $423,000 and by another 2.6 per cent in 2014 to $434,000.
Christina Hagerty, a realtor with Sotheby’s International Realty Canada in Calgary, said she has had a very busy start so far to the year.
“With Calgary’s industries continuing to hire, I see many people coming from other Canadian centres and the U.S,” said Hagerty. “Specializing in the inner-city market, most of the people we meet are either job transfers and want no commute to work, first-time buyers and empty nesters.”
She said rental vacancy rates are at an all-time low and interest rates have remained historically low as well which have been factors in increasing housing demand.
“All the indicators are continuing to confirm our projections last year that Calgary will be leading the nation,” she said. “Affordable mortgages, record low vacancy rates, continued inward migration and low inventory going into the Spring market makes for a year of healthy growth ahead.”
According to the Calgary Real Estate Board, year-to-date until February 21, total MLS sales in the city of 2,498 are up 11.57 per cent compared with the same period last year and the average sale price has risen by 10.63 per cent to $448,635.
For Alberta, the CMHC is forecasting MLS sales to increase from 60,369 in 2012 to 61,000 in 2013 and to 62,400 in 2014.
In the province, the average MLS sale price is forecast to increase from $363,208 in 2012 to $371,200 this year and to $380,700 next year.
The CMHC report also forecast that housing starts in Alberta will fall from 33,396 in 2012 to 31,800 in 2013 but then rise to 32,200 in 2014.
In Calgary, starts are expected to fall from 12,841 in 2012 to 11,800 in 2013 and then rise slightly to 11,900 in 2014.
“The resale market in Calgary is anticipated to remain in balanced territory over the forecast horizon,” said Richard Cho, senior market analyst in Calgary for the CMHC. “Sales in 2013 are forecast to rise for the third consecutive year but at a more tempered pace compared to the previous year. Low mortgage rates, rising incomes and employment growth will continue to help support housing demand. Some sales will also come from renters who migrated to Calgary in the last couple of years.
“The average price has been gradually trending up, and is expected to continue in 2013. Active listings have declined, lowering the selection of available homes and putting pressure on prices.”
mtoneguzzi@calgaryherald.com
Twitter: MTone123

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Calgary housing market sales growth best in Canada

MLS transactions rise 20.2% in January

By MARIO TONEGUZZI, Calgary Herald February 16, 2013

 

CALGARY — While Canadian home sales dipped in January, particularly in major centres like Toronto and Vancouver, Calgary’s housing market remained strong and posted the best year-over-year growth in the country for MLS transactions.
The Canadian Real Estate Association reported Friday that Calgary MLS sales during the month were 1,572, up 20.2 per cent from January 2012 while sales across the nation dropped by 5.2 per cent to 23,579 transactions.
The average sale price in Calgary rose by 9.5 per cent to $418,938 while in Canada it was up 2.0 per cent to $354,754.
Calgary’s housing market has felt the benefit of an overall healthy economy in the past year.
“While the energy sector is still the most critical factor of growth within Alberta, growth has been tempered at the margin by the still-uncertain development of the pipelines going East and Keystone. That said, it’s still going to be a good year for Calgary and Alberta,” said Sydney Suchla, a realtor in Calgary with Century 21 Bamber Realty Ltd. “One of the biggest indicators of prosperity for our province is really the size of population we can expect for 2013. The housing market in Alberta has been improving and is expected to be one of the leaders in growth, although we still need to be cautiously optimistic as active listings are down ... from a year ago (and) new listings being marginally lower from last year.
“But that’s not the real story. Vacancy rates, being at less than one per cent and rent increasing, is ultimately putting pressure on the housing market like we saw in 2005. City hall’s policies restricting new developments on the outlining parts of the city are also putting pressure on prices. The satellite cities are booming as a result. Single-family homes are seeing the most pressure on prices while the condo market tends to be six months behind. With declining economic activity in the rest of Canada, Calgary’s net migration tends to be stronger in such circumstances contributing to housing demand.”
Alberta had the best sales growth of any province in Canada in January with MLS transactions 12.1 per cent higher than last year at 3,486. The average sale price also grew by 5.5 per cent to $361,524.
And Calgary’s housing market is showing no signs of slowing down in February. Month-to-date from February 1-14, total MLS sales in the city of 847 are 11.01 per cent higher than for the same period last year and the average sale price has increased by 8.33 per cent to $455,386, according to the Calgary Real Estate Board.
“Economic activity in Calgary has been stronger compared to other regions in the country and many of the factors that support house demand has seen some impressive gains,” said Richard Cho, senior market analyst in Calgary for Canada Mortgage and Housing Corp. “Employment in 2012 rose 3.7 per cent in Calgary, which was more than three times higher compared to the national average of 1.2 per cent. Average weekly earnings have also increased at a faster rate, and net migration for Calgary is at record levels. This in turn has helped our housing market outperform many other centres.”

Regions like Calgary, which are showing strong economic strength, are beginning to feel that reflected in the housing market, said Don Campbell, senior analyst and founding partner of the Real Estate Investment Network.
“Calgary’s economy, increasing rents, population growth and consumer confidence are all contributing factors to the performance of the market,” he said.
On Friday, the national real estate association also released its MLS Home Price Index of seven major Canadian centres. Regina led the country with an 8.82 per cent hike from a year ago followed by Calgary at 8.03 per cent. The aggregate indicated prices were up 3.12 per cent on an annual basis in the seven centres.
mtoneguzzi@calgaryherald.com
Twitter: MTone123

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Momentum continues in Calgary luxury home market

MLS sales in January just shy of all-time record for the month

By Mario Toneguzzi, Calgary Herald February 5, 2013

CALGARY — Calgary’s housing market experienced a record year for luxury home sales in 2012 and the pace of transactions in January 2013 suggests the market is not slowing down.

According to the Calgary Real Estate Board, there were 34 MLS sales in Calgary of properties over $1 million in January — just shy of the January record of 36 luxury sales in 2007.
Calgary finished 2012 with an all-time record of 544 luxury home sales, eclipsing the previous mark of 458 in 2007.
The luxury home market in the city has rebounded following the recession dip of a couple of years ago.
Don Campbell, senior analyst and founding partner of the Real Estate Investment Network, said that during market corrections luxury homes are the first to drop off, after recreational properties, and the first to come back unlike recreational which is always last to recover.
“In Calgary, within the business world, confidence in business has come roaring back,” he said. “This has led those with capital and strong businesses to take the leap into the market.
“In a higher than average percentage, due to their more business orientation, those buying luxury homes have their finger on the pulse of economic direction and therefore with the resurgence of the Calgary economy over the last 14 months, they are identifying the fact that the luxury homes they want are not going to get any cheaper than they are now. They are seeing the underlying economic strength of the city and want to get into the market before it is reflected in the housing market. That is why you saw so much activity in 2012.”
Campbell said the large number of luxury home sales will push average sale prices up more than it is really being felt at the mid-market level.
“This will create un-supported expectations of mid-market sellers. Also, there are only so many luxury market homes in any given market and they are often the first to move,” said Campbell. “What we often see is a slowdown in these sales after 18 to 24 months and when this occurs it slows down the average sale price increase to lower than is being felt on the street.
“The other anomaly we are seeing in Calgary in the luxury market is the profile of the buyer. Compared to Toronto and Vancouver, whose luxury homebuyer demographic is made up of a large percentage of foreign/offshore buyers, Calgary’s luxury homebuyer profile is very local. People here in business have high paying jobs in Alberta. This is a much more stable cohort than the often fickle offshore buyer.”
Last year in January there were 16 luxury home sales in Calgary. After hitting a high in 2007, the market dipped to only six sales in January 2009.
“We have seen a 20 per cent increase in luxury sales in Calgary in 2012 over 2011 and are seeing tremendous momentum building already in 2013 this past month,” said Rachelle Starnes, realtor with Royal LePage Foothills in Calgary. “We have seen 10 sales over $1 million in Rocky View County in the past month, up 67 per cent over the same period last year. The Springbank area continues to be the busiest being one of the wealthiest areas in the country.

“Prices have dropped in the higher-end to reasonable levels, there is a dwindling supply and buyers have been out shopping the market for months. They have done their research and are ready to buy the minute the ‘perfect’ home hits the market. Calgary continues to be the ‘City of Choice’ for corporations moving West and the high salaries from the oil and gas market sectors allow for lots of ‘move-up’ buyers.”
The following are the annual sales in Calgary for homes priced at more than $1 million, according to the Calgary Real Estate Board:
2012 — 544
2011 — 446
2010 — 365
2009 — 337
2008 — 369
2007 — 458
2006 — 334
2005 — 138
2004 — 44
2003 — 36
2002 — 21
2001 — 14
2000 — 14
mtoneguzzi@calgaryherald.com
Twitter: MTone123

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Calgary housing market soars to new average sale price record for January

MLS transactions also highest for the month since 2008

By Mario Toneguzzi, Calgary Herald February 1, 2013

 

CALGARY — Calgary’s resale housing market had its best January for sales since 2008 as average prices also climbed to their highest level ever for the month.

According to the Calgary Real Estate Board, total MLS sales in the city in January were 1,230, up 15.17 per cent from a year ago while the average sale price rose by 12.34 per cent cent to $439,671.
The previous record high for the average sale price in any January was in 2008 at $413,271.
“In today’s Calgary real estate market there are a number of significant factors that influence our housing sector. The growth within the energy sector is significant along with consumer confidence in the marketplace as well as steady economic performance,” said Kaitlyn Gottlieb, realtor with Century 21 Bamber Realty Ltd. in Calgary. “While these factors continue to increase home sales, should inventory continue to decline, pricing may continue to increase steadily, yet moderately. Although it is early in the year to make market predictions, if 2013 continues to bring good economic activity there is a great possibility that 2013 will exceed our expectations both in the Calgary real estate market and in Calgary’s outlying areas. While 2013 growth may be modest, we can still expect a positive market for this year.
“Alberta continues to fuel growth as a commodity-rich province and is expected to continue to support moderate price growth as we saw in 2012. The increased prices we have seen on single-family homes can partially be attributed to the record number of luxury homes sales we saw last year.”
In the single-family home market in Calgary, sales during January of 879 were up 15.20 per cent from last year and the average sale price rose by 12.74 per cent to $496,579.
The average sale price was the fifth highest ever for any month in the single-family market. The peak was $506,670 set in July 2007.
In the condo apartment category, sales of 204 for January were up 13.97 per cent from a year ago while the average sale price jumped by 13.09 per cent to $280,273. The condo townhouse sector saw sales increase by 16.67 per cent from a year ago to 147 transactions and the average price rise by 7.61 per cent to $320,590.
“Prices have improved in the Calgary market but as always it is important to keep some perspective on this,” said Ann-Marie Lurie, CREB’s chief economist. “While January’s year-over-year increase seems significant, price recovery occurred in the spring months of 2012 under tighter market conditions and home prices leveled off for the remainder of the year.”
CREB also tracks the prices for what it calls typical properties sold. The overall benchmark price in the city rose by 8.35 per cent to $392,000. The single-family home benchmark price jumped by 9.01 per cent to $436,900. It rose by 7.49 per cent in the condo apartment category to $251,300 and it was up by 4.85 per cent in the condo townhouse category to $283,400.
“The employment gains achieved in previous years along with rising income, low mortgage rates and robust net migration levels has sustained demand for housing,” said Richard Cho, senior market analyst in Calgary for Canada Mortgage and Housing Corp. “Many buyers have benefited from Calgary’s growing economy, giving them opportunities to move into homeownership.

“Some of the resale activity will have likely come from renters as well. As the rental market has tightened with average rents moving up, some renters may have decided to purchase a starter home and take on a mortgage instead of paying rent.”
mtoneguzzi@calgaryherald.com
Twitter: MTone123

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