Calgary House Prices Climb at Fastest Rate in Canada

Calgary house prices climb at fastest rate in Canada

Mario Toneguzzi, Calgary HeraldMore from Mario Toneguzzi, Calgary Herald

Published on: December 12, 2014Last Updated: December 12, 2014 3:46 PM MST

Calgary again posted the country’s biggest annual price growth for repeat home sales in November, the latest Teranet-National Bank house price index shows.
It found prices in the city rose 9.2 per cent from a year ago, compared with the national average of 5.2 per cent from the 11 major centres surveyed. Dwellings that have been sold at least twice are considered in the calculation of the index.
“Statistically this time of year has started to slow down, and we are still going strong,” said Tanya Eklund, a realtor with RE/MAX Real Estate (Central). “I do not believe we can sustain the large amount of inflation we have seen over the last two years.”
Calgary Real Estate Board data, through Wednesday, show 533 MLS sales for December, a 7 per cent increase from the same 2013 period.
The Teranet-National Bank report found four other centres — 7.3 per cent in Toronto, 7 per cent in Hamilton, 6.2 per cent in Edmonton and 5.9 per cent in Vancouver — also had annual price increases that exceeded the national average.
More moderate increases were seen in Winnipeg (1.5 per cent), Victoria (1.4 per cent) and Montreal (0.6 per cent). Prices were down in Ottawa-Gatineau (0.2 per cent), Quebec City (0.3 per cent) and Halifax (1.8 per cent).
On a monthly basis, the overall index was down 0.3 per cent from the previous month, the first monthly decline in a year.
“While home prices in Canada’s 11 major cities may have edged down slightly in November, they still remain quite elevated, hovering near record highs.  Moreover, while the decline was fairly broad based, prices in several key cities are well up from year-ago levels,” said Dina Ignjatovic, economist with TD Economics.
“Going forward, solid momentum in the job market over the past few months, combined with an ultra-low interest rate environment should continue to support the housing market in the near term.  However, as interest rates creep up in the latter half of next year and into 2016, affordability will erode, resulting in a moderation in home price growth.”
David Madani, economist with Capital Economics, said national house price inflation is easily outpacing growth in household incomes.
“Accordingly, this only adds to our concern about a housing bubble and a potentially severe market correction down the road,” he said.
“The slump in world oil prices will hit Western Canada hard, and it will only be a matter of months before housing activity and prices begin to fall significantly in Calgary.”
mtoneguzzi@calgaryherald.com
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New Listings Jump 22% - Condo Sector Reports Year-to-Date MLS Sales Up 19%

New listings jump 22%

Condo sector reports year-to-date MLS sales up 19%

By Myke Thomas, Calgary Sun

First posted: Saturday, December 06, 2014 02:00 AM MST

 

After several years of declines, active MLS listings in the City of Calgary are on the rebound, according to the monthly report from the Calgary Real Estate Board (CREB).

New listings in November outpaced sales, resulting in a 22% increase in active listings but, even with the gain, listings remain below long-term averages, says Bill Kirk, CREB president.

“Over the past year, inventories have been low in the city, limiting some of the choice for consumers,” says Kirk. “While availability in specific segments and price ranges vary, on the whole, the recent rise in inventories will be welcome news for many buyers.”

Year-to-date sales in November recorded double-digit gains in all property types, with the strongest increase coming in the condominium sector, including apartments and townhomes, with a combined growth of more than 19%, putting both housing types at record levels, says Kirk.

“Overall, buyers looking for product under $400,000 will find more options in the condominium sector because supply levels have improved,” he says. “In the single-family sector, however, declining supply in that same price range has created much tighter market conditions in that segment.”

Single-family sales last month were down 1% from last November, although year-to-date sales are up 6% compared to the first 11 months in 2013.

New listings of single-family homes year to date increased 6%, accounting for easing growth in the single-family unadjusted benchmark price of $511,300 in November, a 9% increase over the previous year, but down from double-digit increases posted earlier in the year.

Unadjusted benchmark prices for condominium apartments and townhomes were $300,700 and $338,600, respectively, with both condominium sectors seeing price growth ease from double-digit levels.

“Tight market conditions earlier in the year caused significant aggregate price gains,” says CREB chief economist Ann-Marie Lurie. “It also resulted in a rise in new listings, supporting gains in inventory levels and a push towards more balanced levels. This has helped ease the upward growth pressure on prices.

“While Calgary’s price gains have garnered a significant amount of national attention, several indicators are pointing toward more stable conditions, easing risk associated with an overheating market.”

 

Calgary Resale Housing Market Prices and Sales Continue to Climb

Calgary resale housing market prices and sales continue to climb

Mario Toneguzzi, Calgary HeraldMore from Mario Toneguzzi, Calgary Herald

Published on: December 1, 2014Last Updated: December 2, 2014 8:12 AM MST   

 

Home sales stayed strong in November, rising 3.4 per cent from a year earlier, according to Calgary Real Estate Board data.
The median MLS sale price increased 5.3 per cent to $429,000, while the average sale price was up 6.1 per cent to $485,962, it said.
“It was a relatively strong month when we look at sales, listings, inventories. But definitely one that’s moderating,” said Ann-Marie Lurie, CREB’s chief economist. “We’re seeing a return to more balanced conditions and that’s easing some of the pressure on price growth, which is actually a good sign for Calgary’s market.”
In the single-family market, MLS sales last month dropped one per cent to 1,181 transactions, although the average price gained 8.7 per cent to $560,117. The median price rose by 5 per cent to $478,000. Condo apartment sales increased 6.9 per cent to 324. The median price was up by 7.4 per cent to $290,000 and the average price rose 4.9 per cent to $322,486.
Sales in the condo townhouse market increased 21.5 per cent, while the median price was up by 6.4 per cent to $331,000 and the average price rose by 0.7 per cent to $361,013.
Towns surrounding Calgary saw sales jump 15.5 per cent. The median price was up by 3.8 per cent to $383,000 but the average price dropped by 0.4 per cent to $391,155.

Stadium Shopping Centre redevelopment to include hotel, office space

 

By Mario Toneguzzi, Calgary Herald November 19, 2014

 

 

An artist's rendering of the stadium shopping centre.

Photograph by: Handout , Handout

A northwest Calgary strip mall is set to grow taller, transforming into a multi-use property including residential, retail, hotel and office space.
But concerns are being raised about future traffic problems and the disposition of municipal reserve land as part of the development.
Western Securities, owner and developer of the land currently occupied by Stadium Shopping Centre, announced Wednesday it has concluded the master planning process for the 6.1-acre (2.5-hectare) site on the corner of 16th Avenue and Uxbridge Drive N.W. The plan includes a pedestrian bridge for connecting the community to the Foothills Hospital and planned new cancer centre, as well as a central plaza.
A final master plan has been presented through a series of open houses and exhibits at the shopping centre during November.
“The master plan for the Stadium site reflects an organic evolution of the single-use retail site to one that will serve a mix of existing and future demographics in the area,” said Mike Brescia, vice-president of Western Securities Ltd.
“It was important to invest in a thorough planning process with hopes that all stakeholders will see their imprint on the final plan and built product. We’ve come a long way since beginning this master planning process in 2010, and I am very proud of what we have all collectively created for the city.”
The Stadium Shopping Centre Area Redevelopment Plan was approved by city council in July 2013.
Councillor Ward Sutherland said the master plan for proposal “looks good.”
“The main concern obviously from everybody is transportation: how the traffic is going to move. And originally in this controversial development, there’s 14 conditions of traffic that have to be satisfied,” Sutherland said.
“I want to re-assure people that as this build-out occurs these conditions have to be met. So it’s not like this whole thing is going to get built and then we’re going to deal with transportation issues later. Not going to happen. The infrastructure has to be there … there is some controversy of the selling of the land on the corner. That will come up at council.”
On Dec. 8, city council will meet to discuss the municipal reserve disposition and land use for the corner of 29th Street and 16th Avenue N.W.
Peter Khu, president of the University Heights Community Association, said the proposal is a “very, very big development.”
“I think what concerns a lot of people isn’t so much the development itself but the fact that part of the development is being proposed to be built on what currently is public land,” said Khu. “It seems like a small issue, but it’s a very, very important issue because that corridor of 16th Avenue from Banff Trail all the way to the western edge of the city is currently intact. There’s free flow and the potential for other mitigation in the future.
“Our point is that this development can actually with some modifications be developed the way they envision it. But why take that municipal reserve this time? The issue is going before city council on December 8 and the recommendation is to sell it for less than $250,000. Is that good value for the city? That corner is busy now and it is the main entrance to Foothills Hospital. It is the main entrance to the cancer centre. And it is the main entrance a huge number of medical services that will only increase as that site develops. So we think the disposition of that municipal reserve is far, far premature.”

Brescia said the conversation over the municipal reserve land has been going on since 2010. The concept was to create a larger open space by taking land that is being under-utilized and re-purpose it. He said the developer has also been working on addressing traffic concerns in the neighbourhood, adding that the ARP has some very specific outlines in terms of significant transportation infrastructure upgrades that will be required by the developer.
The entire project is about 800,000 square feet, comprising 85,000 square feet of retail, nearly 300,000 square feet of office, 300,000 square feet of residential and 120,000 square feet of hospitality. The hotel will contain about 150 to 200 rooms. There will be about 300 to 350 residential units in various formats.
Brescia said the company is just starting its development permit drawings with more detailed design for the project. That is expected to be submitted by next spring. He said the hope is to be under construction in the first part of 2016. If the project was to be built at once, it would take about five years to be completed.
“We think we have an extraordinarily unique location in Calgary. I don’t think any developers could re-produce what we have here given the proximity to the University of Calgary, McMahon Stadium, Foothills Hospital. The new cancer project has been announced to go across the street from us here,” Brescia said.
‘We think (the site) provides a very unique opportunity to actually put all of these uses with underground parking in this location.”
The Stadium district will feature upgraded transportation infrastructure; tree-lined streets with wide sidewalks and bicycle lanes for access for all modes of transportation; ground floor amenities such as restaurants and retailers and a transit plaza; and a connected network for automobiles, transit, bicycles and pedestrians.
Western Securities said it developed the Stadium Shopping Centre on former farmlands in 1962, and has since remained the primary landowner. Currently, the property is comprised of approximately 60,000 square feet of single-storey retail strip mall and retail pads with a large surface parking lot.
“The redevelopment of the Stadium Shopping Centre site is an important component in the densification and gentrification of this mature trade area in northwest Calgary that is shadow-anchored by the massive Foothills Medical Centre,” said Michael Kehoe, an Alberta-based retail specialist with Fairfield Commercial Real Estate Inc., in Calgary.
The Stadium mall was one of the first purpose-built shopping plazas in Calgary, he noted.
Kehoe said the owners of the property have an “impressive vision” for the site that will “add much needed amenities for this evolving neighbourhood.”
mtoneguzzi@calgaryherald.com
Twitter.com/MTone123

 
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Immigrants play bigger role in supporting housing market

 

By Mario Toneguzzi, Calgary Herald November 19, 2014 12:49 PM

 

 

View of Okotoks housing that could boom if they swing a deal with Calgary for more water rights, in Okotoks on September 21, 2014.

Photograph by: Christina Ryan , Calgary Herald

Immigration plays a bigger role in the nation’s housing market more than many Canadians believe, according to a new report from CIBC World Markets.
“Ask any real estate developer in any of Canada’s major cities about the risk of overbuilding, and the first line of defence would be immigration and its critical role in supporting demand,” said Benjamin Tal, CIBC World Markets’ deputy chief economist, who co-authored the report with Nick Exarhos. “It turns out that at least for now, this claim is more valid than widely believed.
“Not only has the rising share of young immigrants lifted demand for housing, but also, official population projections understate the actual number of non-permanent residents in the country by close to 100,000.”
The report said new immigrants account for 70 per cent of the increase in Canada’s population. With half of the new immigrants between the ages of 25 and 44, they represent the country’s economic engine, the age demographic having the highest employment levels and the most likely to start families, it said.
The number of Canadians aged 20-44 rose by 1.1 per cent in 2013. Over the past decade, the number of Canadians in this age group has risen 75 per cent faster than in the U.S., said the report.
“Healthier demographics are benefiting trends in household formation,” said Tal.
He said the ratio of housing starts to household formation in Canada is not far from its long-run average of 1.03, showing no signs of “froth.”
Only in Calgary do starts continue to show upward momentum, he said.
mtoneguzzi@calgaryherald.com
Twitter.com/MTone123

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Calgary’s condo market booming as average price for single-family homes tops half a million

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Garry Marr | November 3, 2014 | Last Updated: Nov 3 4:11 PM ET
More from Garry Marr | @DustyWallet

Postmedia NewsCondo sales shot up for the sixth straight month in Calgary as buyers look for cheaper options to single-family homes now going for over half a million .

Affordability issues are helping fuel the local condominium market which saw sales climb 14% in October from a year ago, the Calgary Real Estate Board said Monday.

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Condo sale increases from a year ago have reached double digits for six straight months and last month’s gains were credited for the city’s overall sales numbers being up 10% from October, 2013. The board’s benchmark index price for a single-family home reached $513,500 in October compared to $299,800 for a condo.
“While buyers can still find single-family product priced under this threshold in Calgary, the selection has consistently declined over the past four years,” said Bill Kirk, president of the board, in a release.  “As our market moves into more balanced conditions, there has been a notable shift in the composition of the market. Not only do condominiums represent a larger share of total activity, but product availability by price range and property type has shifted.”
The board notes half of new listings in the condo market are priced at under $300,000, a level attracting consumers. “Tight rental market conditions combined with low mortgage rates have supported demand growth for condominium product in Calgary,” said Mr. Kirk, pointing to apartment sales setting a year-to-date record of 4,202. “Much of this demand is coming from both first-time homebuyers and investors.”
Condo listings are also on the rise, up 30% over the first 10 months of the year compared to a year ago. That pace, which is outstripping sales, has allowed inventory to rise and ultimately kept condo prices down.
Only the flip side, single family homes are becoming more expensive with only 18% of new single-family-home listings under $400,000 in October. By the end of the month, Calgary had only 387 single-family homes priced under $400,000.
“As our market moves into more balanced conditions, there has been a notable shift in the composition of the market. Not only do condominiums represent a larger share of total activity, but product availability by price range and property type has shifted,” said Mr. Kirk.
 

Calgary and Edmonton top investment markets for real estate in Alberta

Airdrie places fourth overall

By Mario Toneguzzi, Calgary Herald November 4, 2014                                                                           

 

 

Calgary housing market is very strong this year.

Photograph by: Christina Ryan , Calgary Herald

CALGARY - Calgary and Edmonton top the list of residential real estate investment markets in Alberta, according to a new report released Tuesday.
The new REIN (Real Estate Investment Network) Score measures each city or town on five different categories for a total of 50 points including: Economic Risk (possible 12 points); Yield Growth Potential (possible 12 points); Investors’ Insights (possible 10 points), Political Climate (possible 8 points), and Accessibility (possible 8 points).
Calgary and Edmonton topped the rankings with 50 points followed by Fort Saskatchewan (43), Airdrie (41), St. Albert (39), Red Deer (39), Lloydminster (38), Fort McMurray(36), Grande Prairie (36), and Leduc (34).
Melanie Reuter, director of research with REIN, said “the two most important criteria are the economic risk with a big focus on existing and future jobs and job growth, and the growth potential of yield. Will the going-rent rates mean your cashflow is good in relation to the house prices and is there potential for more and larger growth as the local economy improves?
“It is also important to take into consideration the political climate of a community and whether it has a solid growth plan, cashflow squashing taxes, and whether it has restrictive rental policies. If you can raise rents to match demand or your property taxes are expensive compared to other communities, your current and existing cashflow is compromised.”
Calgary received 12 out of 12 in the economic risk category, 10 out of 12 in yield growth potential, six of eight in local politics conducive to business, eight of eight in access to transportation and nine of 10 in investor’s insights.
The report said the formula of job creation creating an influx of people, leading to higher housing values is evident in Calgary.
“The market is hot! Real estate agents serving investors have noted that good inventory is very hard to come by,” said the report.
“The Calgary Real Estate Board believes that following a prolonged period of Calgary being a seller’s market, the city is once again beginning to move toward more balanced market conditions. Price gains will continue for every housing type, but at a more sustainable pace.”
According to CREB, as of Monday, year-to-date MLS sales in Calgary were 22,941, up 10.67 per cent from the same period a year ago. The median price has risen by 6.88 per cent to $427,500 while the average sale price has increased by 5.78 per cent to $483,115.
mtoneguzzi@calgaryherald.com
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