AYE AYE

Buoyant economy fueling Calgary condo growth
Sales and new construction expected to rise in next two years
By Mario Toneguzzi 
Calgary Herald April 2, 2014 

CALGARY - Calgary’s buoyant economy, healthy population growth and excellent affordability will keep sales of existing condominiums rising over the next few years, says a new housing report released Wednesday.

The latest Conference Board of Canada condo report, released by Genworth Canada, said good demand will also lift condo starts in the city following a pullback in 2013 that was at least partly due to flooding in the summer.

The Winter 2014 Metropolitan Condo Outlook forecast Calgary to see the best growth in prices this year, for eight cities studied, for the resale condo market with median prices rising by 3.2 per cent to $260,523.

The report said they will rise a further 3.4 per cent in 2015 to $269,508.

“A strong economy is first and foremost and everything kind of spins off that,” said Robin Wiebe, senior economist at the Centre for Municipal Studies at the conference board, of the reasons for the optimism in the Calgary market. “When the economy is strong, people come there, come out for work, and that sets in motion the whole housing chain. Starts and resales and all the rest of it.”

The report forecast resale apartment condo sales would be up 2.9 per cent this year to 4,507 units and increase by 2.1 per cent next year to 4,601 units.

Wiebe said affordability in Calgary is a factor. The city has the highest average household income among the report’s eight cities and Calgary’s apartments are not particularly expensive with a median price below Montreal, Toronto, Ottawa, Victoria and Vancouver.

“That makes housing affordability in Calgary excellent,” he said.

The report forecast new condo apartment starts of 2,601 this year, up 6.9 per cent, followed by 2,680 in 2015, up by 3.0 per cent.

It said 2013’s absorptions of 2,772 was the most since 2008 “and likely would have been even stronger were it not for the floods.”

“Accordingly, the inventory of newly completed and unoccupied apartments fell to 244 units - a marked improvement from inventories of nearly 600 units in 2010. Absorptions are forecast to pull back in 2014, but remain strong at nearly 2,400 units,” said the report.

“Modest absorption gains during the medium term are forecast to keep trimming inventories - they will dip below their 20-year average in the projection’s outer years. Falling inventories will give builders the confidence to boost housing starts.”

According to the Calgary Real Estate Board, condo apartment MLS sales in the resale market totaled 1,062 after the first quarter. Sales growth was strongest in this sector due to the availability of listings, it said. New listings after the first quarter totaled 1,722, an 18 per cent increase over the previous year. While demand continued to outpace listing growth, keeping market conditions relatively tight, inventory levels are similar to the previous year, said the board.

“Nearly 50 per cent of new listings in the apartment sector are priced in the range of $200,000 - $299,999, providing options for those looking for affordable product,” said Bill Kirk, CREB’s president.

For the first quarter of this year, the average MLS sale price for condo apartments in Calgary is $317,855, up 9.03 per cent from the same period last year.

“Some easing of the supply pressure in the condominium market is expected as new construction projects are completed,” said Ann-Marie Lurie, CREB’s chief economist. “However, thanks to Calgary’s strong economy, it is expected that most new supply can be absorbed without risk of oversupply and condominium price correction.”

Photo By: Toni Holopainen

A BIG HIKE

Calgary house price growth outpacing rest of Canada
9.6% annual hike for repeat home sales to record level
BY MARIO TONEGUZZI 
CALGARY HERALD MARCH 12, 2014

CALGARY - Calgary’s housing market continues to shine compared with the rest of the country as local residental real estate prices showed the highest growth rate in Canada in February, according to a report released Wednesday on repeat home sales.

Calgary prices rose by 9.6 per cent year-over-year and by 1.1 per cent month-over-month - both the best in the country and to an all-time high for the city, said the Teranet-National Bank National Composite House Price Index.

Nationally, of 11 centres surveyed, prices were up 5.0 per cent from last year and by 0.3 per cent from January.

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.

The trend in price increases in Calgary does not appear to be changing in March. According to the Calgary Real Estate Board, so far this month from March 1-11, the average MLS sale price in the city is up 5.28 per cent from the same time a year ago to $480,345 while the median price has increased by 7.25 per cent to $429,000. CREB stats indicate there have been 796 MLS sales so far this month, up 10.71 per cent from last year but new listings are down 4.05 per cent to 1,114 and active listings are off by 18.80 per cent to 3,049.

The Teranet-National Bank report said that for the second month in a row, prices for Canada as a whole rose to an all-time high, though new records were set in only two of the 11 metropolitan markets surveyed - Vancouver (for a fourth straight month) and Calgary (for the first time since September 2007).

The gain from a year earlier was well above the cross-country average in two of the 11 markets, Calgary and Vancouver (7.7 per cent). It was slightly above the average in Toronto (6.1 per cent) and Edmonton (5.3 per cent), equal to the average in Hamilton (5.0 per cent) and below it in Winnipeg (3.5 per cent) and Montreal (1.9 per cent).

In Halifax (4.7 per cent) and Ottawa-Gatineau (0.6 per cent), prices were down from a year earlier for a second consecutive month. In Victoria (3.4 per cent), home prices have been down from a year earlier for 12 months now. Quebec City posted its first 12 month deflation in 15 years (2.0 per cent). It is the first time since October 2009 that there is price deflation in at least four of the regions covered, said the report.

“In February the east-west dichotomy became more pronounced than ever,” it said.

Home prices were up from the month before in all five markets of Western Canada - Calgary, Vancouver and Victoria (0.9 per cent), Edmonton (0.6 per cent) and Winnipeg (0.5 per cent). The rise in Victoria ended a run of four consecutive monthly declines. For Vancouver it was the 10th consecutive monthly increase. In the six markets of central and eastern Canada, the only monthly rise was in Montreal (0.7 per cent), the second advance after six months of flat or declining prices. Prices were down 0.1 per cent in Toronto, making February the fourth month without a gain in the last six. For Ottawa-Gatineau (0.8 per cent) it was the sixth decline in a row, for Quebec City (1.7 per cent) the sixth in seven months. For Halifax (1.7 per cent) it was the third decline in a row, said the report.

LISTINGS DOWN, PRICES UP

Listings remain down in Calgary resale housing market
Pressure on prices which continue to rise
By Mario Toneguzzi 
Calgary Herald February 3, 2014

CALGARY - Pressure on prices in Calgary’s resale housing market continued in January as MLS listings remained at lower levels compared with a year ago.

According to the Calgary Real Estate Board, new listings of 2,393 for the month were down 4.01 per cent from January 2013 and active listings were off by 18.16 per cent to 2,524.

With sales growing by 17.17 per cent to 1,440, that help spike prices to record levels for the month.

CREB said the median price jumped by 6.71 per cent to $417,250 while the average MLS sale price rose by 5.09 per cent to $462,168. The board, in releasing its official statistics on Monday, said the overall benchmark price in the city, which if what it calls typical property sales, rose by 9.46 per cent to $429,100.

According to Mike Fotiou, associate broker with First Place Realty, January also set a record for most luxury home sales for the month. There were 41 MLS transactions of at least $1 million, eclipsing the previous record of 36 set in 2007.

Last year, Calgary experienced a record year for total luxury home sales of 727 with 10 months setting records. The only months in 2013 that didn’t set luxury home sale records were January and December.

Grace Yan, a realtor with RE/MAX Real Estate (Central) in Calgary, said property inventory has steadily declined over the past year due to a high volume of migration of people to the city, a low unemployment rate and better job opportunities.

“As a result, turnkey properties that are well priced, whether it’s a condo, fixer-upper, starter homes to high-end luxury homes, are selling within days and realtors are lined up outside taking turns for showings resulting in competing offers selling well above list price,” she said. “The market is currently so competitive that we are seeing unconditional or minimal condition offers and I’ve recently seen offers even as high as $70,000 over list and selling within the first day.

“The shortage of listings is really tough on buyers and disappointing when they place their best offer on their perfect home and not to even be close to other competing offers. On the other hand it’s excellent for the sellers who are pleasantly surprised what their properties are selling for. We typically see listing inventory rise come the spring and summer. Real estate, like any other investment, has its ups and downs. It’s just trying to find the right time and the right place in the current hot market.”

The inventory of active listings in Calgary year-over-year hasn’t been positive since February 2011.

Ann-Marie Lurie, CREB’s chief economist, said the overall trend of a declining inventory in the resale housing market has been around since March 2011.

“They had actually too much for a period of time. There was really an excess amount of inventory,” she said. “And a lot of that was working through the system . . . There was over supply in the market at that time frame.

“It’s really over the past year and into this year that we’ve seen those levels to continue to decline . . . They’ve been falling. What I’ve been watching has been that rate of decline which had actually started to ease . . . Towards the beginning of 2013, and into 2012, we were in those high 20 per cent declines, like almost 30 per cent declines, over the previous year. As you go through the later portion of 2013, the levels came off a bit. It’s still declining but not declining as much.”

She said sales have been increasing at a greater rate than the level of new listings.

In January, MLS sales for different housing categories and their percentage increase from last year were: single-family, 974, 10.93 per cent; condo apartment, 260, 27.45 per cent; condo townhouse, 206, 40.14 per cent; and towns, 251, 2.45 per cent.

The average sale prices and their annual hikes were: single-family, $520,686, 4.80 per cent; condo apartment, $314,678, 12.36 per cent; condo townhouse, $371,638, 15.92 per cent; and towns, $379,053, 8.54 per cent.

The benchmark prices and their year-over-year growth were: single-family, $476,700, 9.11 per cent; condo apartment, $280,600, 11.66 per cent; condo townhouse, $308,100, 8.72 per cent; and towns, $346,500, 5.26 per cent.

“Listings are low in Calgary due to a number of factors. However one of the biggest is the lack of housing options available in Calgary and region due to the combination of increased demand through population growth, the flood zone financing and insurance issues and lack of new product readily available,” said Don Campbell, senior analyst with the Real Estate Investment Network.

“This reduction in housing options brings pause to the homeowner who was considering selling their homes to move within the city or region. When homeowners do not have confidence that they will be able to find an appropriate property to replace the one they are considering to sell, then they delay the decision.”

Also on Monday, TD Economics released a housing report forecasting sales in Calgary to grow by 5.8 per cent this year and by another 2.1 per cent in 2015. It forecast the average price for existing home sales to rise by 3.5 per cent this year and by 1.2 per cent next year.

The report said Calgary’s sales to new listings ratio was 70.2 per cent in 2013 and forecasts that to rise to 73.1 per cent in 2014 before falling back to 69.9 per cent in 2015.

TD also said the percentage of income an average household would have to devote to mortgage payments in Calgary in 2013 was 24.9 per cent in 2013 and it is forecast to rise to 25.0 per cent this year but fall back to 24.6 per cent in 2015.

Diana Petramala, economist with TD Economics, said current interest rates are likely unsustainable, nor are they expected to increase to more normal levels in the near future.

“Overall, given the expectations of a modest increase in interest rates, home prices are likely roughly 10 per cent overvalued,” she said of the national housing market. “Housing is very regional, and some markets are more vulnerable than others. For instance, the overvaluation in Toronto, Vancouver, Montreal and Ottawa is likely more significant than that found in markets in the Prairie and Atlantic Regions.

“Looking forward, the combination of softer demand and rising supply of homes for sale on the market will likely pull some steam out of home price growth. Slower home price growth, rising incomes and only modestly rising interest rates will help keep housing in check over the next few years.”

Photo By: Sepehr Ehsani

Booming luxury market pushes Calgary house prices to records

Booming luxury market pushes Calgary house prices to records

Average sale and median prices at unprecedented levels

BY MARIO TONEGUZZI
CALGARY HERALD, JANUARY 2, 2014

CALGARY - A booming luxury market, and tight overall conditions with listings not keeping pace with demand, has pushed Calgary house prices to unprecedented levels.

Average sale and median prices hit all-time records for the city in 2013 for both total MLS transactions and in the single-family home category, according to data released Thursday by the Calgary Real Estate Board.

The average sale price for total MLS reached $456,703 for the year, up 6.54 per cent from 2012, while the single-family average price rose by 7.61 per cent to $517,887.

The median sale price for total MLS was $401,000 and it was $450,000 for single-family homes. The median price rose by 5.53 per cent from the previous year for total MLS and it was a 7.14 per cent hike in the single-family market.

Also, December capped a solid year for the residential real estate market with the highest-ever monthly average sale price at $527,764, eclipsing the previous record of $526,546 set in June 2013.

"Momentum was building from the last quarter of 2012," said Christina Hagerty, a realtor with RE/MAX Realty Professionals in Calgary. "We approached 2013 with low interest rates, one of the lowest unemployment rates in the country and the lowest vacancy rate in the past decade. Employment growth and higher than expected net migration into the city helped support the demand for housing and increased sales and pricing. 2013 was an extremely busy year for us with informed and prepared purchasers.

"People talk about the flood adding to this, but I focus on the amazing ability for a city to rebound in a very short period of time. Something that may have devastated other major centres. I believe that this is largely due to the sense of community and the job market allowing people the ability to rebuild."

The previous records for average sale prices were set in 2012 at $428,649 for total MLS and $481,259 for single-family homes. The previous records for median prices were set in 2007 at $382,000 for total MLS and in both 2007 and 2012 at $420,000 for the single-family market.

Average prices in the city ballooned this year as a result of a strong luxury market that set a record for most transactions ever at $1 million or more.

devastated other major centres. I believe that this is largely due to the sense of community and the job market allowing people the ability to rebuild.”

According to Mike Fotiou, associate broker with First Place Realty, there were 727 luxury home sales in 2013, which was a 33.6 per cent hike from the previous annual peak in 2012. The year was marked by 10 consecutive months of new monthly sales records. Only January and December did not set records in 2013.

Total MLS sales in the city reached 23,489 units in 2013, up 10.78 per cent from the previous year. New listings of 32,153 were up 0.97 per cent but active listings at the end of December were down by 17.80 per cent to 2,235.

"Companies are recruiting professionals across Canada and globally and this has put Calgary on the map as a thriving metropolis of opportunity and a safe place to raise their families," said Hagerty. "With vacancy rates at one per cent and an abundance of job opportunity, there is a confidence in the city. 2014 looks to continue with solid growth fueled by sound fundamentals."

MLS sales and percentage increase from 2012 for different housing categories were: single-family, 16,302, 7.92 per cent; condo apartment, 4,007, 14.45 per cent; condo townhouse, 3,180, 22.40 per cent; and towns, 4,516, 13.81 per cent.

Average sale price and percentage increase from 2012 were: single-family, $517,887, 7.61 per cent; condo apartment, $299,517, 5.17 per cent; condo townhouse, $341,116, 7.73 per cent; and towns, $381,884, 9.55 per cent.

Median price and percentage increase from 2012 were: single-family, $450,000, 7.14 per cent; condo apartment, $261,000, 3.78 per cent; condo townhouse, $306,000, 6.45 per cent; and towns, $355,700, 6.18 per cent.

Scott Bollinger, broker with the ComFree Commonsense Network, said prices in Calgary climbed because of increased sales and listings not keeping pace with the demand.

"Most notably in 2013 we saw rising wages, low interest rates and record in-migration. So it’s not surprising after three to five years of relatively little price growth, and despite the steady employment and the wage growth along with record low interest rates, that prices surged this year," he said.

"Add to that the Alberta and Calgary economies outperformed almost every other region in Canada in 2013 by a wide margin, which had the effect of attracting all of those people. But the interesting thing is that 70 per cent of the net migration to Calgary in particular was international. And the other thing about the migration was that we set a record this year for the growth of the cohort of ages between 25 and 45 and those people, along with the international crowd, are most likely to engage in household formation."

Bollinger said he is surprised that the listings didn’t catch up with the sales. He said the market might expect to see more of a reaction from the listing side early in the new year.

"If we don’t see that increase in listings, I think we’re going to continue to see farily significant price increases," said Bollinger.

In a statement, Ann-Marie Lurie, CREB’s chief economist, said sales growth exceeded expectations in 2013, pushing above long-term trends.

"Two consecutive years of elevated levels of net migration, combined with an improving job outlook and confidence surrounding long-term economic prospects, supported the demand growth," she said.

"In 2014, both sales activity and prices are expected to improve, but not at the same pace recorded this year. While factors influencing demand will support growth in 2014, rising listings and increased competition from the new home sector should alleviate some of the supply pressure in the market."

Those factors, combined with potential increases in long-term lending rates, should take some of the steam off the exceptionally strong price growth recorded in 2013, said Lurie.

OUT OF STOCK

Sellers' market for resale in Calgary
By Claire Young
Calgary Herald November 8, 2013 

Despite a recent rise in the number of new listings, resale housing in the city remains a sellers’ market, says the Calgary Real Estate Board.

“Price growth and tighter market conditions have encouraged some of the recent rise in new listings,” says chief economist Ann-Marie Lurie of CREB in a news release.

“This is a trend worth noting as the rise is easing some of the tightness in the market. Despite some movement, sellers’ market conditions persist.”

New resale listings of all kinds of housing in Calgary totaled 2,522 units in October, up nine per cent from 2,312 during the same month last year.

New listings have been down in other months this year, meaning the number of new listings so far this year is on par with the same time last year.

From Jan. 1 to the end of October, there were 29,358 new listings compared with 29,333 during the same period last year.

In October, there were 1,953 total sales of resale housing of all kinds, up 17.7 per cent from 1,659 sales last year.

Homes also sold faster, spending on average 40 days on market in October compared with 46 days during the same month in 2012. The average sale price for homes of all kinds rose last month to $458,876, up five per cent compared with $437,030 a year earlier.

There were 1,739 new listings of single-family resale homes in Calgary in October, up 7.6 per cent from 1,615 during the same month last year.

Meanwhile, the pace of sales continued to pick up, selling in an average of 38 days last month compared to 43 days in October 2012.

The average price of single-family homes increased 4.7 per cent to $516,244 in October, up from $492,772 last year.

Sellers are commanding an extra half per cent this month on the final sale price compared to the same time last month, earning 97.78 per cent of the list price.

NORTHWEST FLEXES MUSCLES

Of the 1,336 sales of MLS-listed single-family homes in the city, the northwest quadrant of Calgary was the most popular with homebuyers in October, says the Calgary Real Estate Board

The board’s Zone A, roughly the city’s northwest, saw 463 resale houses trade hands at an average sale price of $530,892.

There were 357 sales in October in the board’s Zone C, roughly the city’s southwest, at an average price of $654,889.


Meanwhile, the board’s Zone D — roughly southeast Calgary — logged 266 transactions of single-family homes at an average price of $479,149. In the board’s Zone B, roughly the city’s northeast, 250 homes changed hands at an average price of $330,599.

FAVOURING THE SELLER

Calgary housing market soaring with sales and price hikes
Strong sellers’ conditions as listings down
By Mario Toneguzzi 
Calgary Herald November 1, 2013

Calgary’s resale housing market continued to soar in October with strong year-over-year hikes in both sales and prices.

According to the Calgary Real Estate Board, MLS sales of 1,953 for the month were up 17.72 per cent from a year ago as the average sale price rose five per cent to $458,876 while the median price saw an increase of 5.96 per cent to $409,000.

“The October Calgary real estate market kept a consistent absorption rate between two to 2.2 months worth of inventory. This places us in a strong sellers’ market,” said Robyn Moser, a realtor with CIR Realty in the city.

“Attributes of a sellers’ market are, competing offers, listed home selling in the first two weeks or sooner, sellers being able to dictate the terms of the negotiations and not having to settle for much less than realistic asking prices. All consistent with our October experiences.”

Although new listings for the month were up 9.08 per cent to 2,522, active listings at the end of the month were down 16.19 per cent to 3,841.

The average days on the market to sell a property dropped from 45 a year ago to 40 in October.
Moser said housing activity in Calgary may be fuelled by a number of factors: seasonal fall peak activities with people wanting to purchase and move into homes before winter sets in; investor speculators coming into the market due to the flood impact in June; corporations reorganizing and centralizing back to Calgary and Edmonton; and rental rates increasing.

“Buyers had to react to this market by acting quickly when homes came available for sale, being prepared to pay asking price or above and ensuring they were prequalified and prepared for condition days of seven days or less in order to get their offers accepted,” said Moser.

Sales and prices were up across all housing categories in the city during the month.

In the single-family home market, there were 1,336 MLS sales, up 14.29 per cent from last year with the average sale price increasing by 4.76 per cent to $516,244 and the median price rising by 5.12 per cent to $452,000.

The condo apartment category saw sales rise by 24.35 per cent to 337. The average sale price was up 6.76 per cent to $309,415 and the median price rose by 8.80 per cent to $272,000.

In the condo townhouse market, sales of 280 were up 27.85 per cent with the average price rising by 13.49 per cent to $365,037 and the median price up by 8.29 per cent to $319,450.

The towns surrounding Calgary saw sales jump by 22.04 per cent to 382 with the average price increasing by 10.54 per cent to $380,350 and the median price up 8.11 per cent to $360,000.

“Price growth and tighter market conditions have encouraged some of the recent rise in new listings,” said Ann-Marie Lurie, chief economist at the real estate board. “This is a trend worth noting as the rise is easing some of the tightness in the market. Despite some movement, sellers’ market conditions persist.”

Employment growth, strong net migration, lack of rental product and low mortgage rates have contributed to the rise in housing demand over the past two years, she said.

“Meanwhile, supply levels have not kept pace, causing prices to push up,” added Lurie.

AUGUST RUSH

Calgary home sales sizzling
Number of homes sold in August much higher than expected
CBC NewsSeptember 4, 2013

The hot Calgary real estate market finished the summer with higher than expected home sales in August and a new record set for the benchmark price of a single family home.

A new report from the Calgary Real Estate Board (CREB) shows the number of home resales were up 30 per cent for the month of August compared to the same time last year.

The price tags were also up last month with the benchmark price of a single family home set at almost $465,000 — an increase of 7.4 per cent and a record high.

The benchmark price this year is $13,000 higher than 2007 but CREB admits it has not adjusted for inflation.

Anne-Marie Lurie, the chief economist with CREB, said the June flooding and a possible increase in interest rates may have spurred people to buy.

"Some of those renters that were displaced chose to jump into ownership a lot sooner and people who were already in the market looking for a home may have sped up that decision increasing that demand."

Continuing trend

Realtor Doug Hayden said homes listed between $400,000 and $450,000 are generally selling within days.
"I don't see prices going backwards. I think this is the new market," said Hayden.

The CREB report shows condominium prices and sales have also increase by seven per cent compared to the same time last year, but not have reached the levels of 2007.

For Video: http://www.cbc.ca/news/canada/calgary/story/2013/09/04/calgary.html

STAY STRONG

Calgary MLS sales in August on pace for 2nd highest ever
August 2005 set the record
By Mario Toneguzzi
Calgary Herald August 23, 2013

CALGARY — Calgary home sales are on pace for the highest August total since 2005 and the second highest on record for the month, says a Calgary realtor.

Mike Fotiou, associate broker of First Place Realty, said month-to-date between August 1-21 there have been 1,462 MLS sales in the city, up 32.4 per cent from last year.

That’s down from the 1,516 sales pace set in August 2005 for the same period. Sales ended up at 2,326 for the entire month of August in 2005.

According to the Calgary Real Estate Board, for the first three weeks of August, the average sale price increased by 10.14 per cent to $456,105 and active listings of 4,089 were down 24.57 per cent.

Tanya Eklund, with RE/MAX Real Estate (Central) in Calgary, said there are so many factors that have helped the real estate market reach such impressive numbers.

“The flood did throw a wrench into things in some communities, yet we have seen other communities flourish from the flood. As long as the price of oil stays strong, the pipeline out east goes forward, the vacancy rate stays low, all of these will contribute to the continued strength in our economy,” said Eklund in a live Herald web chat on the real estate market with Ann-Marie Lurie, CREB’s chief economist and Don Campbell, senior analyst and founding partner of the Real Estate Investment Network.

“We are in a seller’s market currently I would say. I base it on number of sales versus listings and I also consider days on market. We are fairly low in inventory based on last year and our sales have increased substantially.”

Campbell said Calgary entered the year with a real estate market that was performing exactly how it should have been, based on its underlying economics.

“While the world turmoil was continuing to grow, Calgary’s economy almost felt sheltered from the storm. Economic growth, population growth, housing demand right on trend ... then the floods hit and turned the city and its market upside down,” he said.

He said, now post flood, the numbers will not be indicative of the actual underlying market and although will still look good, they won’t be reflective of how the market is really performing.

“The bottom line is this: the results of this flood will play a role in the housing numbers for at least 12 months in all cities and towns affected by it and will skew the market health readings,” he said.

Lurie said strong resale growth numbers will likely persist for much of this year, outside of the flood, as migration levels posted stronger than expected levels, supporting stronger than expected demand growth.

“The housing market will continue to benefit due to strong fundamentals, assuming the energy sector remains strong,” she said.

CALGARY TOPS IN GROWTH

Calgary leads country in housing market price growth
Prices up nearly 7% from last year
By Mario Toneguzzi
Calgary Herald August 15, 2013

CALGARY — Calgary led the country in July with the best year-over-year price growth in the resale housing market.

The Canadian Real Estate Association’s MLS Home Price Index, released Thursday, indicated prices in Calgary were up 6.79 per cent — more than doubling the national aggregate of 2.66 per cent price growth.

The index measures the rate at which housing prices change over time taking into account the type of homes sold. Nine major Canadian centres are surveyed.

“Our market is trending towards a selling market. Listing inventory is 20 per cent lower than this time last year and pricing is approximately seven per cent higher overall,” said Tanya Eklund, with RE/MAX Real Estate (Central) in Calgary. “The Calgary floods created a short-term surge in house purchases in certain areas. People who could afford to buy have purchased, so their families were not displaced. Due to the very low vacancy rate, rental inflation and difficulty in finding rental accommodation, this made some consumers turn to purchasing instead of renting.

“We are seeing many inner-city communities flourish with sales, however I am seeing certain suburb markets higher in inventory in the plus $1 million, so sales have not been as abundant as other communities closer to the interior of the city. Overall, it appears to be a great time to sell. Buyers have less time to think about their purchases with hopes of not losing out on their ideal home. I am confident we will continue to see a stable real estate market as we enter into the fall.”

CREA stats indicated Calgary MLS sales in July of 2,976 were up 18.9 per cent from last year while the average sale price jumped by 7.0 per cent to $438,192.

Across Canada, sales were up by 9.4 per cent to 44,829 units and the average price rose by 8.4 per cent to $382,373.

In Alberta, transactions increased by 17.8 per cent to 6,853 units while the average price was up by 4.3 per cent to $379,696.

“Canadian home sales have staged a bit of a recovery in recent months after having declined in the wake of tightened mortgage rules and lending guidelines last year, but the numbers for July suggest that national activity is levelling off at what might best be described as average levels,” said Gregory Klump, CREA’s chief economist. “Sales dropped sharply in August last year, so we may see some year-over-year increases in sales and average prices next month that would reflect weakness in the rear view mirror.”

Sales and prices in Calgary are continuing their upward trend in August. According to the Calgary Real Estate Board, month-to-date until Wednesday, total MLS sales of 945 were 32.17 per cent higher than the same period last year and the average sale price was up 13 per cent to $455,688.
In another report released Thursday, Canada Mortgage and Housing Corp. forecast MLS sales in the Calgary census metropolitan area to rise to 27,800 transactions this year from 26,634 in 2012. Sales are expected to jump to 28,300 in 2014.

The agency forecast the average MLS sale price in the Calgary region to rise from $412,315 in 2012 to $435,000 in 2013 and to $445,000 in 2014.

Nationally, the CMHC’s point forecast is for MLS sales across Canada to decline from 453,372 in 2012 to 448,900 this year and then rise to 467,600 in 2014.

The national average sale price is expected to see year-over-year growth of 2.7 per cent this year to $374,800 followed by an increase of 2.1 per cent in 2014 to $382,800.

SMOKIN' HOT

Calgary real estate industry heading for $9-billion plus year

MLS sales and average prices continue to rise

BY MARIO TONEGUZZI

CALGARY HERALD AUGUST 8, 2013

CALGARY — Calgary’s residential real estate market is on pace to record one of its highest ever yearly total dollar volume for MLS sales.

As of Tuesday, the local industry reached just over $6.8 billion in year-to-date transactions. That is more than $800 million ahead of last year’s pace which was just short of $6 billion as of Aug. 6, according to the Calgary Real Estate Board.

In 2012, total dollar volume for the entire year was slightly over $9.1 billion — only the third time in history it eclipsed the $9-billion mark. The other times were in 2006 at just under $9.9 billion and the record year of 2007 at $11.3 billion.

Christina Hagerty, a realtor with Sotheby’s International Realty Canada, said it’s been a busy real estate market in Calgary this year.

“We anticipated this activity in the beginning of the year with vacancy rates as low as one per cent in the inner core. Limited rental supply and increased rental rates, continued low interest rates with a positive influx of people transferring to Calgary, have made it an extremely buoyant real estate market,” said Hagerty.

“Inner-city condo prices in newer buildings are between $500 to $600 per square foot. There are competing offers from buyers ready to make a purchase when something of quality hits the market. This has caused a ripple effect into inner-city homes from both empty nesters downsizing, transferees, and condo sellers moving up. Many of our clients are renters moving into the buying market simply due to rental prices, investors seeing an opportunity or a significant amount of people moving here from across the country.”

She said home builders are picking up lots where they can find them and there have been several situations where lots are bidding for $100,000 to $200,000 above list prices in inner-city neighbourhoods.

“Alberta fundamentals remain sound and confidence in Alberta’s economy remains strong. It’s a testament to Calgary’s spirit and resilience that the post-flood cleanup has continued at its remarkable pace. Calgary has been leading the nation for the past few years and continues to grow,” added Hagerty.

According to CREB, there were 21,326 MLS sales in Calgary in 2012 with an average sale price of $427,912. In 2007, there were 26,709 sales with an average price of $423,145.

As of Wednesday, year-to-date, there have been 15,001 MLS transactions in Calgary, up 7.06 per cent from the same period a year ago and the average sale price has risen by 6.88 per cent to $457,499.

Becky Walters, CREB’s president, said pent-up demand is contributing to the continued rise in residential real estate sales in the city.

“This past year we saw 30 some thousand net migration to the city,” she said. “We’re getting more and more people moving here ... We’ve got fabulous job availability here.”

Another factor is that Calgary consistently rates high as one of the most affordable housing markets in the country due to its high level of personal income.

“People are seeing that there’s not a ton of inventory. So they’re getting out there making sure they get what they want,” added Walters.

SHINE ON

Calgary sets record with 4 MLS sales over $4 million in one month 

Luxury home market continues to shine
By Mario Toneguzzi 

Calgary Herald July 9, 2013

CALGARY — For the first time ever, four homes priced at more than $4 million on the MLS market have sold in one month in Calgary, the Herald has learned.

The Calgary Real Estate Board has confirmed the record, which eclipsed the previous mark of two homes sold at that price point in June 2008.

In the first week of July, the sales at more than $4 million included homes in Britannia ($4.45 million), Elbow Park/Glencoe ($4 million) and Mount Royal ($4.645 million).

Then on Monday a home in Bel Aire sold for $4.45 million.

It’s another indication that the luxury home market is continuing to shine in Calgary.

According to Mike Fotiou, associate broker with First Place Realty, there have been 18 homes sold for more than $1 million in the first week of July.

Ann-Marie Lurie, chief economist at CREB, said year-to-date luxury home sales represent 3.2 per cent of the total sales, up from last year’s share of 2.5 per cent.

“Consumers have more choice in luxury homes with a rise in the number of new listings in this category, helping support the sales growth,” she said. “However, more choice has contributed to median price growth in the luxury sector to be relatively weaker than city wide price growth. The median value of the sold transactions have trended up from the low of the recession and are slightly higher than levels recorded last year, however, they still remain below levels recorded during the 2007 period.

“Despite some economic setbacks, long-term economic prospects remain relatively strong in our city. Wages continue to rise while mortgage rates remain at low levels — all of which are supporting demand growth. Furthermore, the tight supply levels in the lower price ranges have reduced the time on market and supported relatively stronger price growth in this sector, potentially offering an opportunity for those consumers looking to upgrade.”

Last month, a home in Crescent Heights, listed by John Hripko, a realtor with Royal LePage Foothills, sold for $11.1 million — a new high for the Calgary MLS market. That home was owned by former Shaw executive Jim Shaw.

According to Fotiou, there were 74 luxury home sales in June, setting a record for the most $1-million plus sales for the month of June. The all-time monthly record for luxury home sales was established in May at 84.

Last year was a record of 544 luxury home sales in the city.

According to CREB, there were 394 sales of $1 million or more in the first six months of this year compared with 299 for the same period last year.

The mid-year total so far this year has already surpassed year-end totals for 2010 (365), 2009 (337), and 2008 (369), pointed out Fotiou.

Photo By: s@@m

MAY, OUI

Calgary condo sales in May see upward trend
May 28, 2013

As the month of May nears its end, Calgary’s resale condo market has seen a healthy upward movement in sales and prices.

According to the Calgary Real Estate Board, month-to-date until May 27, there have been 346 MLS sales in the condo apartment category, up 5.17 per cent from the same period last year.

The median price has risen by 4.56 per cent to $261,500 while the average sale price is up by 12.39 per cent to $310,871.

In the condo townhouse category, sales of 311 are 25.91 per cent higher than a year ago; the median price has increased by 7.63 per cent to $317,500; and the average sale price is up 3.54 per cent to $342,638.

Source: Calgary Herald Blog

SUP?

Calgary homes selling quicker
May 27, 2013

It’s interesting to see how the age-old dynamic of supply and demand is playing itself out in today’s Calgary real estate market.

When supply is down and demand is up, that’s going to impact prices and it’s also going to impact the length of time it takes to sell a property.

Well, supply is down these days in Calgary’s housing market while sales continue to grow. That’s pushing prices upwards – near record levels. And homes are selling quicker.

Here’s the numbers.

According to the Calgary Real Estate Board, month-to-date until May 26, there have been 2,049 MLS sales in the city, up 2.71 per cent from the same period last year.

Days on the market to sell a property have dropped from 39 last year to currently 31, which is a drop of 20.51 per cent.

New listings of 3,091 so far this month are down 4.83 per cent from last year and active listings are off 18.16 per cent to 4,821.

All those numbers are sure to impact prices.

So far this month the median price is up 3.87 per cent from last year to $405,000 and the average price has risen by 3.26 per cent to $459,951 for all MLS property sales in the city.

LUXURY HOME MECCA

Report finds Calgary a luxury home mecca
Baseline entry point is $2M for upscale residence
By Mario Toneguzzi
Calgary Herald April 22, 2013

Calgary is one of Canada's most robust markets for luxury homes, says a report by Sotheby's International Realty Canada.

The baseline entry point for a luxury single-family home in Calgary is $2 million - in line with the Toronto market - says Sotheby's Top Tier Trends Report.

As Calgary's market for top-tier homes continues to outpace most of Canada, Sotheby's survey findings reveal demand is predominantly driven by younger buyers, age 35 to 40, who have a skew in preference toward inner-city and Beltline living.

The report lists the most desirable neighbourhoods as Mount Royal, Brittania, Bel-Aire, Aspen, Springbank Hill, Elbow Park/Elbow Valley, and Inner City Southwest/ Westside

"According to agents surveyed, top-tier single-family homes start at $2 million dollars with a minimum of 3,500 square feet," the report states. "According to experts surveyed, over 80 per cent of these homebuyers earn an income of $500,000 or higher.

"They are predominantly employed within the finance and investment banking (mining, oil and gas) or medical sectors, or are entrepreneurs," the report continues.

According to the survey, 85 per cent of luxury home purchases in Calgary are made by Canadians - the highest rate among the markets Sotheby's surveyed.

"According to agents surveyed, top-tier single-family homes start at $2 million dollars with a minimum of 3,500 square feet," said the report. "'Must-have' features include access to schools and shopping, views of downtown, park, river or mountains," the report says.

"Most buyers own multiple homes and mortgages are commonly used within this segment of the market."

According to the Calgary Real Estate Board, there have been 204 MLS sales over $1 million in Calgary this year to April 17.

The city set a record for luxury home sales during 2012, with 544 sales. The previous record was 458, set in 2007.

Richard Cho, senior market analyst in Calgary for Canada Mortgage and Housing Corp., said that demand for luxury homes has been robust.

"Low mortgage rates combined with a healthy selection of higher-priced homes have also helped luxury homebuyers."

MONDO CONDO

Pace increases for condo sales
By Josh Skapin
Calgary Herald April 11, 2013

Sales of resale condos were on the upswing in March compared to a year earlier, says the Calgary Real Estate Board.

Sales climbed to 630 deals, up 6.6 per cent from 591 transactions during the same month last year.

Townhomes led the charge in sales with 283 moves after 235 units changed hands a year earlier, marking a 20 per cent change.

That came with a 10.3 per cent climb in new listings with 395 after there were 358 last March.

The apartment market, on the other hand, saw little change, easing 2.5 per cent.

“The condominium apartment market remains in balance,” says CREB chief economist Ann-Marie Lurie, in a news release.

Last month 347 apartments were sold after 356 deals during the same time in 2012.

New listings of apartments eased 13 per cent at 560 after there were 644 during the same time last year.

“While it has moved to the lower end of the spectrum, it remains better supplied than the single-family market and the majority of product available is in an affordable price range,” says Lurie.

While condo apartments dipped in sales, the benchmark price went up six per cent. The benchmark price is that of a typical home based on a formula that uses various factors to ensure accurate comparisons.

For condo apartments, the benchmark price was $257,700 last month, up six per cent from $243,000 a year earlier.

The townhome benchmark price also increased last month compared to a year earlier.

It reached $286,800 for a four per cent step up from $274,600 this time in 2012.

A TEXTBOOK MARKET?

What happened to the expected Alberta real estate boom?
Market influencers tempering demand
By Mario Toneguzzi
Calgary Herald April 11, 2013

CALGARY — Several ‘market influencers’ have kept the reins on the expected Alberta real estate boom, says a new report on the housing market.

The report, by Don Campbell, senior analyst and founding partner of the Real Estate Investment Network, said debate is raging about why the market isn’t booming like it did in 2006 and 2007 when the job market and population in the province were growing at the same rates as they are today.

“The real difference this time is hidden in the strong forces of today’s market influencers. It is very true that the market drivers are all in place to support a large growth in housing purchase demand and price increases, in fact it is a textbook market for a boom,” said Campbell.

“In Alberta, the GDP and job growth have driven very strong population growth which has led to low vacancy rates not experienced in this province for many years. Street rents are jumping due to the rental supply/demand inequality. So, on the surface that means Alberta should be experiencing another one of those unsustainable booms. Well why isn’t it? And is there one still in the works?”

He said certain wild cards can throw a market off its prescribed cycle for periods of time.

“So, despite all of the market drivers being in place to push the Alberta real estate market into its next boom cycle the market continues to underperform its economics. Why? Simply, there are market influencers in play and that is why we are not yet seeing the expected rush into the market demand,” he said.

They include the once-bitten, twice-shy attitude equating into a local lack of confidence in the market. Many Albertans made their first home purchases during the previous boom. They were hit hard when the financial crash came. This has tempered enthusiasm for the market now.

Tighter mortgage qualification rules have also tempered market demand.

Overall consumer confidence in real estate is taking a hit with many recent reports and headlines on the state of the Canadian market saying it may be over-priced or overvalued.

A large portion of Alberta population growth is from two key demographics who are less likely to buy a house immediately — immigrants and ‘Echo-boomers’.

According to the Calgary Real Estate Board, total MLS sales year-to-date in the city until April 10 were 5,798 transactions, up 3.72 per cent compared with the same period last year.

The average sale price this year has risen by 8.08 per cent to $451,246 while the median price is up by 5.92 per cent to $397,000.

Ann-Marie Lurie, CREB’s chief economist, said the organization never felt the economy was about to boom, based on several factors.

“The first consideration is the economy,” she said. “In the 2005-2007 period, we had significant growth in both the oil and natural gas sector, economic growth as of late has only been driven by the oil sector. While this has helped support growth, there have been some challenges regarding bottlenecks and price discounts which has impacted employment growth prospects in the province. We also shouldn’t forget that the natural gas market continues to struggle. Our economic growth is progressing but at a slower pace, and forecasters also estimated that employment growth and net migration would ease this year, two factors pointing towards slower demand growth in housing.

“The next consideration is fundamentals in the housing market. Inventory levels were generally more elevated in the resale market, and it has taken some time to absorb some of the excess in the market. While this has occurred primarily in the single-family market, it has only started to spillover into the surrounding areas, the condominium market, and the new home market. When considering all the options available to consumers, there was sufficient choice to prevent any significant shortage in the entire housing market, which was the case in 2006-2007, causing a unsustainable jump in home prices.”

She said she is not surprised that the market didn’t boom, given the economic backdrop and current supply in the market.

Lai Sing Louie, regional economist for the Prairies and Territories for Canada Mortgage and Housing Corp., said market conditions in Alberta’s housing markets today are different from the boom.

“Some of the differences include higher household debt as well as more prudent lending conditions today. Also, some of the transactions in that period were investor driven and we have not experienced that to the same extent today,” he said.

The underlying economics and Market Drivers state that the market should be on fire, just like it was back in 2006 and 2007 – that is unless you begin to factor in these influencers, said Campbell.

“Let us make sure we are analyzing today’s markets with today’s conditions and not compare them to previous boom-bust cycles. Each cycle has its own influencers that either heat up or cool down a market and this current cycle from 2006 until today is the perfect proof of that,” he said.

“As long as the drivers are strong, the market is structurally strong, no matter what the influencers are doing. The concern should arise when the drivers are weak and the influencers are pushing the market upwards with no support. That is not what is happening in Alberta right now; in fact, the drivers remain strong despite the headlines.”

Ben Brunnen, chief economist with the Calgary Chamber of Commerce, said the province is definitely seeing all of the signs of strong economic and potentially housing growth.

“Net inter-provincial migration, population growth is up. Unemployment is low and GDP growth is relatively high,” said Brunnen. “I think we’re seeing probably a bit more of a cautious consumer out there. I do think we’ll see some strong real estate activity happening in Calgary but not like in the boom.

“I think there continues to be some caution in the market for a number of reasons. While Alberta’s economy is good, the global economy continues to be shaky, especially Europe and the United States. So people don’t have that strong confidence per se that this economic activity is going to be sufficiently robust that they should buy a house.”

WITHIN A HAIR

Resale home prices rise to near record
By Claire Young
Calgary Herald April 5, 2013

Fewer houses for sale and greater demand are pushing single-family resale housing prices up to near historical averages, says the Calgary Real Estate Board.

The average price rose to $518,392 in March, up 9.6 per cent from $472,698 during the same month last year.

This is within a hair of the new record of $518,500 for the average resale price for single-family homes logged in February, which beat the old high mark of $506,700 set in July 2007.

“Tighter rental conditions and continued employment growth has supported housing demand growth,” says chief economist Ann-Marie Lurie of CREB. “However, for those looking for more affordable single family home products, their choices continue to narrow.”

There were 3,194 new resale listings in Calgary in March, down almost five per cent compared to 3,348 during the same time last year.

For the first three months of 2013, the number of new listings was 8,358, down 4.6 per cent from 8,761.

“Less resale product available to consumers is ultimately limiting sales growth,” says CREB president Becky Walters in a news release. “In addition, resale homes are selling in less time and with continued upward pressure on prices.”

Listings of single-family resale homes in Calgary saw a year-over-year drop, declining to 2,239 in March, down 4.5 per cent from 2,346.

March’s benchmark price —that of a typical home based on a formula that uses various factors to ensure accurate comparisons — also rose to $446,500 in March, up 8.9 per cent from $411,000.

New listings of single-family homes under $500,000 are declining at double-digit rates, says Lurie. She predicts this will drive potential Calgary homebuyers to consider surrounding towns, condominiums or the new home market.

In Calgary, total sales of single-family homes dropped to 1,480 in March, down six per cent from 1,575.

The board’s Zone A, which is roughly the city’s northwest, saw 541 transactions at an average sale of $507,545 and 33 days on the market.

The two communities in the city that saw the most sales activity in March were both in Zone D, in the southeast.

Cranston and McKenzie Towne both logged 41 sales. The highest average sales were logged in the board’s Zone C in the southwest community of The Slopes, with two sales averaging $1.72 million.

OUT-OF-TOWN SALES DROP

Total MLS sales of resale homes in the communities surrounding Calgary dropped by two per cent in March compared to the same month last year, says the Calgary Real Estate Board.

Sales fell to 364, down from 372 sales, while new listings dropped significantly during this time to 662 in March, down 15.6 per cent from 785 last year.

But average prices rose to $365,002 in March, up 4.7 per cent from $348,474, says the board — and benchmark prices also increased to $336,100, up 7.1 per cent from $348,474.

The benchmark price is that of a typical home determined using various factors to ensure accurate comparisons.

OUT-PERFORMING IN AB

Calgary listed as an “out-performer” in Canadian real estate market
Pace predicted to be moderately lower for Canada
By Mario Toneguzzi
Calgary Herald March 11, 2013

CALGARY — Canada is expected to embark on a gradual, modest, downward housing market adjustment over the next three years with a “measly” two per cent annual price gain over the next decade, says a study released Monday by TD Economics.

But the bank has also listed Calgary as an “out-performer” in Canada for the long-run rate of return on Canadian real estate. Compared with the national picture, Edmonton, Vancouver, Victoria and Toronto were also listed as out-performers for the future.

“With the slowdown in the Canadian housing market well entrenched, many are worried about the future value of their homes. This is not surprising as real estate is the largest financial asset most Canadians have in their possession,” said TD Economics.

“The housing market is prone to cyclical ups and downs and we should embark on a gradual, modest, downward adjustment over the next three years. We project a 3.5 per cent annual rate of return on real estate to prevail beyond 2015 – this is the long-run rate of increase for home prices in Canada. However, this pace will be moderately lower than they have been historically (5.4 per cent).”

Derek Burleton, vice-president and deputy chief economist with TD Economics, said Calgary had a run-up in prices before the recession and then a sharp decline during the recession.

“I guess prices didn’t come back too much but certainly sales fell back and now you’re getting a bit of a cyclical bounce,” he said, adding a long-term forecast takes into account key economic drivers like population growth and the potential of the economy to generate income.

“Based on some of the key drivers of growth, Calgary ranks right up there at the top and that should stand the housing market good stead. At least continue to drive above average price gains over the long run.”

The average MLS sale price in Calgary was $180,420 in 2000. That climbed to a peak of $423,770 in 2007 before dipping to $394,064 in 2009. From then, it has steadily climbed, reaching an all-time record of $428,644 in 2012.

Becky Walters, president of the Calgary Real Estate Board, said the Calgary market is really strong this year due to the in-migration it has been getting over the past 12 months.

“It’s not maybe as strong this year as it was last year but it’s certainly strong,” said Walters. “We’re seeing a nice steady growth. We’re seeing prices starting to come up a little bit not tons.”

For example, according to CREB, year-to-date until March 10, there have been 3,595 MLS sales in the city, up 4.66 per cent from the same period a year ago, and the average sale price has jumped by 9.23 per cent to $451,189.

However, at the national level, TD said a string of lacklustre performances over the next few years will mean that the annual rate of return for real estate in nominal terms will be a “measly” two per cent over the next decade, meaning home price gains should simply match the pace of inflation.

“Our research at REIN Canada is showing that for the coming five years, outperforming markets will be those based not in speculation or foreign investment, they will be those markets supported by underlying economics,” said Don Campbell, senior analyst and founding partner of the Real Estate Investment Network. “The Canadian real estate market is too broad and too diverse to paint with one story or byline and will become an increasingly regional story. Supporting economics such as increasing jobs, increasing population through migration — especially those areas which are attracting a younger, working age cohort — and increasing incomes will play a larger role in market demand and value than it has in the last five years.

“Despite Calgary and Edmonton’s value moves already experienced, they are both rated in the most affordable major centres in the country because average incomes are also higher than in most other regions. This, along with the younger age of in-migrants to these cities from other parts of the country, will be strong and supporting factors for these market for the coming years.”

Richard Cho, senior market analyst in Calgary for Canada Mortgage and Housing Corp., said in the Calgary region the average price in 2013 is expected to reach $423,000, up 2.6 per cent from 2012.

“The rate of growth is anticipated to be higher here than in many other areas of the country as the average resale price in Canada is forecast to increase by only one per cent in 2013,” he said. “Supply of homes in Calgary’s resale market has come down from a year earlier while sales have been fairly stable. The resale price in 2014 is forecast to continuing rising in Calgary, averaging $434,000.”

2013 CALGARY REAL ESTATE BOARD FORECAST

CREB® forecasts moderate sales, price growth

 The full forecast report is available here.

Calgary, Jan. 16, 2013 – The resale housing market in Calgary and area will see moderate sales and house price growth in 2013, CREB® said today at its annual forecast.

Sales growth in the city is expected to ease to 2.2 per cent this year, with house prices rising by 2.9 per cent.

“Slower growth trends in employment combined with lower migration estimates will impact sales growth across all resale sectors, and, as listings continue to decline, this will further dampen sales growth, particularly in the single-family market,” Ann-Marie Lurie, CREB®’s chief economist, said at the 2013 CREB® Forecast Conference & Tradeshow. “However, as the overall market remains well supplied, prices will continue to grow but not at the levels seen in 2012.”

In 2012, Calgary’s single-family market recorded sales growth of nearly 15 per cent. With a decline in the level of new single-family listings, that is expected to ease to 1.8 per cent this year. Prices are estimated to rise by three per cent.

Becky Walters, president of CREB®’s 2013 board of directors, said the city and surrounding areas are seeing good resale activity.

“We have a nice, balanced market, and it’s expected to see some growth this year,” Walters said. “Although some big markets in Canada are stumbling, Calgary is hot on the heels of a year of recovery, with the forecast saying the market is going to stay in positive territory.”

In the condominium market, sales are expected to increase by three per cent, with a moderate price appreciation of 2.4 per cent for condo apartments and 2.8 per cent for condo townhouses.

Although the prediction is for a “balanced” resale housing market, Lurie said there are numerous risks in the market.

“The largest risk in our market is related to concerns in the oil sector,” she said. “They are facing pipeline constraints and lack of access to more diverse markets, impacting the price they receive for their oil. If the discounts on our oil persist, this clearly could impact the job sector and, ultimately, the housing market.”

BEST IN CANADA

Calgary luxury home market sales growth best in Canada
Sotheby’s International Realty Canada predicts trend to continue
By Mario Toneguzzi
Calgary Herald January 11, 2013

CALGARY — Calgary led the country in 2012 in sales growth for the luxury home market, according to firm Sotheby’s International Realty Canada.

Ross McCredie, president and chief executive of the real estate company, said Calgary is the “best performing market in Canada right now in terms of growth.”

“The trend has been upward and we don’t see any sign of that changing for awhile,” said McCredie. “There’s more and more investment coming into Alberta. More and more people are moving there. You’ve got a range of jobs. It’s not just simply oil and gas companies that are investing there.

“In the rest of the country, there’s definitely a trend going west and Alberta is probably leading that trend in terms of companies investing in key offices across Canada as well as foreign companies coming in as well.”

He predicted double-digit sales growth for Calgary’s luxury home market this year which will outstrip the performance of other major centres across the country.

“Calgary is really starting to become a city of high net worth people and investment coming into the country,” said McCredie.

In its Top-Tier Real Estate Report, a biannual study highlighting market trends for the most expensive homes in Canada’s largest urban centres, Sotheby’s said the market for luxury homes is expected to gain momentum and “to generate increasing demand from both local and international buyers given strong economic fundamentals, historically low interest rates and a national unemployment rate that has hit a record four-year low.”

In Calgary, compared with the same July to December period in 2011, listings over $1 million were up 38 per cent and sales of real estate in the same category were up 21 per cent in the second half of 2012.

“The average days on market for homes over a million dollars increased slightly to 66 days and the percentage of properties selling over asking price dropped slightly to five per cent,” said the report. “High-end neighbourhoods like Elbow Park and Glencoe were among those to see strong demand.”

According to the Calgary Real Estate Board, the city experienced a record for MLS sales over $1 million each in 2012 with 544 transactions, eclipsing the previous record of 458 in the housing boom of 2007. In 2011, there were 446 luxury home sales.

In 2012, the luxury home market had 508 single-family home sales and 36 condo sales compared with 420 and 26 respectively in 2011.

CREB said 1,533 homes were listed for sale in Calgary over $1 million in 2012 — 1,408 single-family and 125 condo. In 2011, there were 1,352 luxury home listings — 1,253 single-family and 99 condo.

In 2007, the luxury home market had 1,242 listings for the year, comprised of 1,159 single-family homes and 83 condos.

“We saw such an increase in activity in the last two quarters of 2012,” said realtor Christina Hagerty, who recently joined Sotheby’s in Calgary. “The momentum was building up all last year and it continued over the holiday season. This should be a good indicator of the year ahead. With the dwindling supply, and the strong pulse on the street that ‘Calgary is where you need to be,’ properties priced at market, are selling. Buyers are not wasting any time. They have done their research and are ready to make an offer when the right one hits the market.”