Calgary home price growth doubles national average: CREA

Year-over-year hike of 8.82% best in Canada

By Mario Toneguzzi, Calgary Herald December 16, 2013

 

  

 

 

Home prices in Calgary continue to rise.

Photograph by: Ted Rhodes Ted Rhodes , Calgary Herald

CALGARY - Calgary year-over-year home price growth was the best in Canada in November and more than doubled the national average, according to the Canadian Real Estate Association.
The association’s MLS Home Price Index, released on Monday, said prices in Calgary have risen by 8.82 per cent from a year ago while in Canada, for 11 major centres surveyed, they were up by 4.11 per cent.
The index tracks benchmark prices in Canada’s housing markets.
CREA said MLS sales across Canada in November rose by 5.9 per cent to 32,411 units. They were up by 18.7 per cent in Calgary to 2,173 units and increased by 13.1 per cent in Alberta to 4,563 sales.
Related: Canadian home sales, prices stronger than expected
The average sale price in Canada was up by 9.8 per cent to $391,085 and increased by 7.5 per cent in Calgary to $445,114 and by 5.3 per cent in Alberta to $385,217.
CREA also released a revised residential market forecast on Monday. It said sales in Alberta this year are projected to reach 66,300 units, which is a 9.8 per cent hike from the previous year and the best growth rate in the country. Sales will rise an additional 3.5 per cent in 2014 to 68,600 units.
Across Canada, the association is forecasting 0.8 per cent growth this year to 458,200 sales and 3.7 per cent growth in 2014 to 475,000.
As for the average sale price, CREA is projecting it to rise by 4.9 per cent this year in Alberta to $381,100 followed by 3.4 per cent growth, the best in Canada, in 2014 to $393,900.
Across Canada, the association is forecasting 5.2 per cent price growth this year to $382,200 and 2.3 per cent growth in 2014 to $391,100.
“In staggering contrast to the dire forecasts early this year, precisely one of the 26 largest cities in the country has reported a drop in average prices so far this year — Victoria, with a minuscule 0.6 per cent sag,” said Doug Porter, chief economist with BMO Capital Markets. “All of the other 25 cities have recorded single-digit price gains, with the median city posting a non-threatening 3.6 per cent rise.
“When judged by total sales volumes, a measure that combines both price changes and the number of units sold, the hottest markets this year have been Calgary, Edmonton, and, against all expectations Vancouver. All three reported double-digit volume increases, the only cities in that category.”

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Calgary tops Canada for repeat home sale price growth

Increase of 5.9% from last year

 

By Mario Toneguzzi, Calgary Herald December 12, 2013

 

 

 

Prices for repeat home sales in Calgary saw the highest year-over-year hike in Canada in November.

Photograph by: Steven Senne , AP

CALGARY - Calgary had the nation’s best year-over-year price growth in November for repeat home sales, according to the latest Teranet-National Bank National Composite House Price Index released Thursday.
Prices in Calgary rose by 5.9 per cent from October 2012 while they were up 3.4 per cent in the 11 metropolitan markets surveyed for the index.
The rise from a year earlier exceeded the cross-country average in five of the 11 markets: Calgary, Hamilton (5.2 per cent), Toronto (4.2 per cent), Vancouver (3.9 per cent) and Quebec City (3.7 per cent). The report said the 12-month gain lagged the average in Edmonton (3.0 per cent), Winnipeg (2.8 per cent), Ottawa-Gatineau (1.2 per cent), Halifax and Montreal (0.8 per cent). Prices were down in Victoria (1.4 per cent).
The index is estimated by tracking observed or registered home prices over time using data collected from public land registries. All dwellings that have been sold at least twice are considered in the calculation.
On a monthly basis, prices in Calgary fell by 0.3 per cent from October and by 0.1 per cent across the country.
Prices were up on the month in four of the 11 metropolitan areas: Vancouver and Halifax (0.6 per cent), Hamilton (0.3 per cent) and Winnipeg (0.1 per cent). Prices were down from the month before in Victoria (1.8 per cent), Montreal (0.6 per cent), Calgary (0.3 per cent) and Edmonton, Quebec City, Ottawa-Gatineau and Toronto (0.2 per cent).

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Calgary housing prices forecast to grow in 2014

4.3% gain predicted for next year

By Mario Toneguzzi, Calgary Herald December 10, 2013 2:00 PM

 

 

 

Calgary’s housing market saw strong gains in sales and prices in 2013.

Photograph by: Ted Rhodes , Calgary Herald

CALGARY - The Calgary Real Estate Board is forecasting house prices and sales to continue to climb in the resale market in 2014.
On Tuesday, the board released its preliminary forecast, saying prices are expected to rise by 4.3 per cent next year and MLS sales are expected to climb by 3.6 per cent from 2013.
Ann-Marie Lurie, CREB’s chief economist, said strong migration levels over the past two years have combined with strong employment, wage growth, and a tight rental market to support further gains in 2014.
“2013 has been a year that has exceeded expectations on all levels,” said Lurie. “This is the second year in a row that we’ve had double-digit increases in sales. Very strong activity. And this year that sales activity pushed above those long-term averages.
“Migration is expected to actually ease off from the levels we saw this year. So that 19,000 new migrants that came to Calgary this year, well two years in a row, is forecasted to drop to 15,000. So that is still a significant pullback. That’s one of those factors that eases off demand.”
According to the board, year-to-date up to Monday, there have been 22,710 MLS sales in the city which is a 10.97 per cent hike from the same period a year ago. The median price has risen by 5.30 per cent to $400,150 while the average sale price is up by 6.51 per cent to $456,762.
CREB’s full annual forecast takes place January 15.
Lurie said supply levels this year didn’t keep pace with rising demand which pushed the market to favour sellers. She said tight market conditions will continue in the near future but rising listings and increased competition from the new home sector will alleviate supply pressure and push the market to more balanced conditions in the latter part of the year.
Lurie also said potential increases in long-term lending rates should take the steam off the exceptionally strong price growth of this year.
Don Campbell, senior analyst with the Real Estate Investment Network, said it looks like another year of strength in 2014 for the city’s real estate market.
“The big story will be the average age of the new population that is moving here from outside the province. We will witness a new type of demand begin to emerge as two and three bedroom units will begin to see increase in demand as housing and rents become less affordable thus forcing this new and younger population to share accommodations,” he said. “In addition, the lack of affordable basement suite options will also drive rents up more quickly than they should be, and should hit a new record price in 2014.”
He said the lack of supply and high rents will move people more quickly into the home purchase mode.
“In other words, not having these affordable rental options will, ironically, push purchase demand and thus purchase prices up more quickly than expected,” explained Campbell. “The longer this important issue is shuffled around, the higher the price of property will become in Calgary and region.
“With all of the factors lining up as they are, we should be witnessing the Calgary housing market out-perform most others in the country and frankly out-perform its underlying economic fundamentals as the pendulum swings solidly into seller’s market territory later in the year.”

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Calgary strongest major housing market in Canada: BMO

Sellers have upper hand on prices 

By Mario ToneguZzi, Calgary Herald December 5, 2013

 

 

                 

CALGARY - Calgary has reclaimed its title as the strongest major housing market in the country after correcting several years ago, says a new report released Thursday by BMO Economics.
The report, Canadian Housing Update: Tale of Four Cities, examined the state of the housing markets in Canada’s four largest cities: Vancouver, Calgary, Toronto and Montreal.
Sal Guatieri, senior economist with BMO Capital Markets, said listings are lean in the city, giving sellers the upper hand right now on prices.
“Three main factors. Strong economy. Strong population growth. And good affordability. Those are all driving Calgary’s housing market now and likely in the future,” said Guatieri.
“We don’t see bad things happening to Calgary’s economy any time soon, barring a big drop in oil prices for example. And we think Alberta for one will definitely lead economic growth perhaps for the next couple of years riding the energy boom. As a result, Canadians from across the country will likely continue to migrate to Alberta and Calgary looking for work. That can always support the housing market.”
According to the Calgary Real Estate Board, year-to-date up to Wednesday, there have been 22,489 MLS sales in the city, up 10.85 per cent from a year ago. New listings of 31,366 are up by 0.75 per cent but active listings of 3,034 are down 19.27 per cent. So far this year, the median selling price of $400,000 has increased by 5.26 per cent while the average sale price of $456,680 has risen by 6.60 per cent.
“Calgary’s resale housing market has been strong this year,” said Ben Brunnen, an economic consultant in the city. “A lot of people are moving to our city and finding that rents are high but the economy is good. Under these conditions, homeownership makes sense.
“Unlike the last housing market expansion a lot of current homeowners are staying put, which keeps inventories low. Strong confidence in Alberta’s economic prospects and the threat of higher housing costs in the future could also be pushing more people into the market.”
The BMO report said new home construction has picked up but housing starts have barely kept pace with an exploding population.
“Inventories of new homes are very low, while benchmark prices are climbing the fastest among major cities and have now all but retraced the 16 per cent collapse from 2007 to 2009, said BMO.
Guatieri said that despite “heady price gains” they remain reasonable at about four times the median family income and mortgage costs “consuming a manageable” 23 per cent of earnings.
“About half of the increase in prices is supported by rising income. Hourly wages in Alberta are up 4.4 per cent year over year in the first 10 months of the year, double the national rate,” he said.
BMO said immigrants and young Canadians are flocking to the city, drawn by better job prospects, faster wage growth, and healthier housing affordability than in Vancouver and Toronto.
“Strong economic and population growth will encourage an upward trend in Calgary’s house prices, though higher borrowing costs will moderate the gains,” added Guatieri.

The report listed Calgary’s median family income at $100,500. The other three cities surveyed had median family incomes of $72,400 in Toronto, $72,800 in Vancouver and $73,200 in Montreal.
The ratio of house prices to annual family income in Calgary was 4.1. It was also 4.1 in Montreal, 6.6 in Toronto and 8.3 in Vancouver.
The mortgage service costs as a percentage of family income were: 23.1 in Calgary, 39.3 in Toronto, 50.2 in Vancouver and 23.1 in Montreal.
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Low Inventory Pushes up Calgary House Prices in November

Low inventory pushes up Calgary house prices in November (with graphic)

 

By Mario Toneguzzi, Calgary Herald December 2, 2013

 

 

 

CALGARY - A low inventory of active listings combined with increased sales has pushed Calgary home prices once again in an upward direction to a record high in November.
Statistics from the Calgary Real Estate Board indicate MLS sales in November rose by 18.74 per cent year-over-year to 1,730 transactions with the average sale price increasing by 5.56 per cent to $458,053 and the median price climbing by 8.50 per cent to $406,875.
The average sale price is a record for the month, eclipsing the $433,931 set in November 2012. The all-time high for any month is $466,495 in June this year.
Although new listings rose by 11.70 per cent to 1,823, active listings at the end of the month of 3,156 were down 17.62 per cent from a year ago. And days on the market to sell a home fell by 22 per cent to 39.
"Throughout the fall we have seen the market stay consistently strong as it has for the rest of 2013, with quick sales turnover and a low inventory of homes actively on the market. Coming into the winter months and even into the new year it doesn’t look like the market’s going to slow down backed by Calgary’s striving economy," said Megan McCormick, realtor with Century 21 Bamber Realty Ltd.

Calgary single-family homes Calgary condo apartments Calgary condo townhouses | Infographics

"Prices and sales have continued to quickly rise with a large majority of new homeowners joining the marketplace, many leaving the tight rental market sooner than anticipated. A booming economy, record high employment rates, and homeowners being displaced by the flood are also pushing this high demand of Calgary homebuyers."
According to Mike Fotiou, associate broker with First Place Realty, November set another record for luxury home sales as 50 properties sold in the $1-million plus price range, breaking the monthly record of 48 set last year. It’s the 10th straight month of a new monthly peak.
Fotiou said there have been 689 luxury home sales this year until the end of November, up 36.4 per cent from the 505 recorded for the same period in 2012. The previous annual record was 544 set last year.
In November, CREB’s stats show single-family home sales were up 18.99 per cent to 1,197 with the median price rising by 8.33 per cent to $455,000 and the average sale price increasing by 5.76 per cent to $516,447.
The condo apartment category saw sales of 305 during the month, up 20.55 per cent from last year. The median price rose by 3.85 per cent to $270,000 but the average sale price dropped by 1.1 per cent to $307,078.
In the condo townhouse category, sales increased 15.15 per cent from last year to 228. The median price was up 7.15 per cent to $310,150 and the average sale price rose by 12.07 per cent to $353,445.
Sales in the towns outside of Calgary rose by 17.78 per cent to 318 with the median price up by 8.64 per cent to $368,250 and the average sale price up by 15.61 per cent to $392,022.
CREB tracks what it calls benchmark prices for typical properties sold in the market. The benchmark prices in November with their year-over-year change were: total MLS city, $424,600, 9.21 per cent; towns, $347,900, 5.62 per cent; single-family, $470,600; 8.53 per cent; condo apartment, $279,600, 12.74 per cent; and condo townhouse, $305,700, 8.10 per cent.
Ann-Marie Lurie, CREB’s chief economist, said the low inventory in the Calgary residential market is a result of continued strong sales.
"It’s continued to push down inventory," she said. "The level of new listings adds to supply and it hasn’t kept pace . . . Basically demand hasn’t let up.
"Another factor is also what’s happening in the new home sector. When you do tend to see inventory start to increase significantly sometimes it’s because there’s just too much in the new home market too . . . But because we’ve had such a strong influx of people and there’s been enough demand, even what they’re doing in the new home sector isn’t enough to push up inventory levels."
Scott Bollinger, broker with the ComFree Commonsense Network, said what’s really striking about this month’s numbers is the big drop in inventory.
"New listings are up, for sure, but not enough to close the gap," he said.
"Fall - well, let’s be honest, winter - timing is partly what’s at play here. It’s a low-volume time for Calgary real estate and even the bullish numbers can’t coax homeowners by the thousands into selling when it’s cold and snowy, especially when they’re confident the market will be just as strong in the spring. Most homeowners don’t want to sell and move during the winter, and that’s as good a reason as any that low inventory will persist till the snow melts." mtoneguzzi@calgaryherald.com
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