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.

KEEP CALM AND BOOM

‘It’s boom time in Alberta’: New home construction at a five-year high (graphic)
By Mario Toneguzzi
Calgary Herald June 10, 2013

CALGARY — New home construction picked up in the Calgary region in May with Alberta’s level at a five-year high.

It’s a sign that the housing market is heating up.

Canada Mortgage and Housing Corp. reported Monday that total starts in the Calgary census metropolitan area reached 1,078 units during the month, which was an increase from 949 in May 2012.

“The trend of total housing starts increased slightly in May, due to strong construction in both the single-detached and multi-family markets,” said Richard Cho, CMHC’s senior market analyst for Calgary.

Multi-family starts rose to 519 in May from 466 a year ago while the single-detached market saw starts jump to 559 from 483 last year.

“While softer energy prices may be moderating overall economic growth this year, it appears that home builders didn’t receive the memo. Judging by the most recent statistics, it’s boom time in Alberta,” said Todd Hirsch, chief economist at ATB Financial.

Builders started construction on 41,438 new homes in Alberta in May — the highest this year and the first time since early 2008 that the figure has risen above the 40,000 mark.

“What’s more, the trend over the last several months clearly suggests that the housing market is heating up,” added Hirsch. “Between May 2012 and May of this year, housing starts are 14.1 per cent higher than they were in the previous 12-month period.

“What’s causing this boom in home construction isn’t any big mystery: population growth. Even if overall economic growth has slowed somewhat, the inflow of people into our province hasn’t.”

The latest Labour Force Survey, released last week, points to a surge in the labour force, which has grown by 59,400, or 2.6 per cent, over the last 12-months.

“Interprovincial and international migration to Alberta is driving some of the demand for new homes. High wages, low unemployment and a younger population are also contributing factors,” said Hirsch.

“The strong housing starts number ... is supported by another figure from Friday’s employment report — the number of construction jobs is also rising. Even if jobs in the energy patch and manufacturing have eased back a bit, employment in construction continues to provide some great work opportunities.”

Robert Kavcic, senior economist with BMO Capital Markets, said multi-unit housing starts in Canada came storming back in May “after falling precipitously through the winter months.”

“Still, the six-month trend in overall Canadian housing starts sits very close to demographic demand, further hinting at a soft landing,” he said.

Total Canadian housing starts rose by 13.8 per cent in May to 200,178 annualized units, the strongest pace in six months, added Kavcic.

The multi-unit segment rose by 22 per cent.

He said Alberta posted a modest gain, and activity in the province now sits at the highest level in five years.

“With the six-month moving average now more in line with the rate of household formation, May’s sharp jump in the pace of new home construction is unlikely to be sustained,” said Dina Ignjatovic, economist with TD Economics, about the national picture. “Indeed, slower price growth in the housing market could lead to lower homebuilding activity in the coming quarters. Moreover, the overbuilding that has taken place over the last 10 years could lead to new home construction falling below this demographic need for a period of time. This should, however, help to prevent further overbuilding and a consequential sharp correction in the housing market.

“Overall, we expect new home starts to gradually trend down over the next 12-18 months, suggesting that the Canadian economy will not be able to count on residential investment to prop up growth over that time frame.”

For Graphs:
http://www.calgaryherald.com/business/Calgary+region+housing+starts+trend+upwards/8503723/story.html

LUCKY SEVEN IN NOVEMBER

Calgary resale housing market sales strong in November
Sales up nearly 7% over last year
By Mario Toneguzzi
Calgary Herald November 30, 2012

CALGARY — Calgary’s resale housing market continues to defy a national cooling trend.

With one day left in November, data from the Calgary Real Estate Board indicates total MLS sales and average prices during the month in the city are elevated from last year.

From November 1-29, there have been 1,390 total MLS sales, up 6.92 per cent compared with the same period a year ago and the average sale price has risen by 4.90 per cent to $433,590.

Every housing category in the city has seen strength in numbers this month.

In single-family homes, there have been 960 sales, up 3.56 per cent from last year, with the average sale price moving up by 3.93 per cent to $488,155.

The condo apartment category has experienced 245 transactions, an increase of 6.52 per cent, while the average price has risen by 22.14 per cent to $309,235.

In the condo townhouse sector, the average sale price has jumped by 3.15 per cent to $315,126 and sales are up 29.37 per cent to 185 transactions.

On Friday, the Conference Board of Canada released its regular monthly resale housing market report of major centres across Canada and it said the average year-over-year price growth for the latest three months in Calgary is between three to 4.9 per cent.

In October, the seasonally-adjusted annual rate of sales in the Calgary census metropolitan area was 27,312, up 22 per cent year-over-year while new listings of 39,864 were down 8.4 per cent.

The average residential sale price of $423,468 was up 5.5 per cent from last year.

MARKET CONFIDENCE

Resale condo pace reflects 'confidence'
By Josh Skapin
Calgary Herald September 7, 2012

Total sales of resale condos in Calgary continued to climb in August, rising 19 per cent compared to the same month last year, says the Calgary Real Estate Board.

There were 556 sales of apartments and townhouses last month, up from 468 transactions in August 2011, says the board.

The biggest increase came in townhouses, which saw a 31 per cent hike in resale activity last month compared to the same month last year.

But the average resale price for townhouses in Calgary in August was $281,941, 3.45 per cent lower than the same period last year.

“Some continue to foresee a scenario where price declines are looming in the local housing market, especially given national trends,” says chief economist Ann-Marie Lurie in a news release.

“There is no question economic concerns can threaten our housing recovery. However, to date, Calgary housing market consumers are exhibiting confidence evidenced through the pick-up in sales activity across all housing types.”

While townhouse prices are down, the average resale price of condo apartments was 7.22-per-cent higher last month than in 2011, rising to $281,941 per unit.

The area in Calgary with the highest condo apartment and townhouse resale activity in the city last month was in Zone C, which roughly corresponds to the city’s southwest.

Not only did the area have 288 deals, it also had the highest average resale price at $314,467.

Zone A, which roughly corresponds to the city’s northwest, saw the second highest sales totals and average price.

The average price in Zone A was $294,867 for 155 sales last month.

Zone D, which translates to southeast Calgary, had 66 transactions last month at an average rate of $287,340.

At the same time, Zone B, which covers northeast, Calgary saw 47 units change hands at an average price of $172,234.

DID YOU KNOW?

The biggest increase in condo apartment resale activity in Calgary has come in the $200,000 to $299,999 price range, says the Calgary Real Estate Board.

To Aug.1, 1,132 units in this price range changed hands in Calgary, up from only 949 sales during the same month last year.

The $200,000 to $299,999 price range led all condo sales in the city in August, alone, at 151.

THE SEVEN BEST

Canada among 7 best housing markets in the world
Mamta Badkar
Business Insider Sep 5, 2012

While much of the world is seeing home prices depreciate, there are a few countries where home prices are on the rise.Canada ranked among Germany, Switzerland and Hong Kong in the top 7 housing markets.

Global Property Guide’s latest report shows, however, that even the strongest housing markets are losing momentum as the economy falters.

Of the 39 countries tracked by GPG quarterly house prices fell in 25 countries and climbed in just 13.

We published the worst housing markets Tuesday, and today we’ve highlighted the 7 best housing markets in the world, based on year-over-year home price changes.

Canada ranked among Switzerland, Germany, Hong Kong in the top 7.

Home prices in Hong Kong were up 3.01 percent year-over-year (YoY) and 6.85 percent quarter-over-quarter (QoQ) in Q2 2012

Home prices in Canada were up 4.06% YoY and 1.59% QoQ in Q2 2012

Home prices in Switzerland were up 4.86 percent YoY but down 0.54 percent QoQ in Q2 2012

Home prices in Germany were up 5.24 percent YoY but down 2.02 percent QoQ in Q2 2012



Home prices in Delhi, India were up 6.23 percent YoY nut down 1.09 percent QoQ in Q2 2012

Home prices in Norway were up 6.26 percent YoY and up 2.98 percent QoQ in Q2 2012



Home prices in Sao Paulo, Brazil were up 15.56 percent YoY and 2.38 percent QoQ in Q2 2012

Photo By: cityNnature

LESS WILD, MORE URBAN

Alberta housing leads nation: CMHC
Latest forecast predicts more construction in Western Canada
By Lewis Kelly
Edmonton Journal August 15, 2012

The Canada Mortgage and Housing Corporation forecast Tuesday that housing construction and sales will increase modestly in 2013 in Alberta while activity in most of the country slows down.

The Crown corporation's latest housing market outlook predicts 400 more housing starts in 2013 in Alberta than 2012. That represents just 1.25-per-cent growth, but CMHC predicts national construction activity to decline 6.8 per cent over the same period.

"The economy in Alberta has been improving and is expected to be one of the leaders in economic growth," said Richard Cho, senior market analyst with CMHC's prairie division. "That will naturally support the housing market."

Cho said CMHC's forecast for Alberta hinges on continued job production, international and interprovincial immigration boosting population growth, and the price of oil staying high enough to encourage continued investment in the province's energy sector.

Oil has been trading around $90 a barrel since early August after reaching a yearly low of $79.69 in June. CMHC forecasts employment growth of 2.5 per cent in Edmonton and 2.9 per cent in Calgary in 2013, and net migration growth of 28 per cent to 57,800 in the coming year.

Tuesday's edition of the corporation's outlook, released four times a year, predicts just over 32,000 housing starts in the coming year for the province, 11,000 of those in Edmonton. The forecast calls for the resale market to also grow, reaching 59,800 by the end of this year and 61,000 in 2013.

Cho said the market has favoured buyers until recently and should move to a balanced state, boosting price growth in the process. The CMHC's forecast calls for prices to rise 2.5 per cent this year and 2.8 per cent in 2013 across Alberta, bringing the average home sale to $372,300.

The provincial picture differs from the national numbers. CMHC predicted 193,100 units of housing will get built across Canada in 2013 - down around seven per cent both from previous forecasts and 2012's forecast numbers.

Cho said the new federal mortgage rules introduced in July, which knock five years off the maximum amortization period, will soften demand for housing, but other factors ultimately carry more weight in real estate.

"The rules will certainly have an impact on housing demand, but it isn't the only factor" he said. "Housing demand is also supported by growth in employment and earnings as well as migration flows and relatively low mortgage rates."

DEMOGRAPHICS DEMO

Demographics will take edge off housing downturn: CIBC
Canadian Press
Aug 23, 2012

A senior economist at one of Canada’s major banks says a widely anticipated downturn in the housing market may not be as deep or as long-lasting as some fear.

Benjamin Tal, deputy chief economist at CIBC World Markets, says demographic forces over the next decade will limit the damage.

Tal writes that there will be fewer Canadians under the age of 25 and between the ages of 45 and 54, but those groups account for a small portion of home buyers.

But Tal says the group aged between 25 and 34 — the age group that makes up the vast majority of first-time buyers — will continue to grow, and he says growth in the housing market could be even stronger due to immigration.

Overall, the CIBC economist says the next decade will see an annual population growth of 0.9%, in line with growth seen in the past decade — a period of strong demand for residential real estate and a sharp jump in housing prices.

SOARING IN APRIL

Calgary’s housing market soars in April
MLS sales up 26% from a year ago
By Mario Toneguzzi
Calgary Herald May 1, 2012

CALGARY — It was a very busy April for Calgary’s housing market.

According to the Calgary Real Estate Board, overall residential MLS sales in the city of 2,200 for the month were up 26.07 per cent from April 2011 and the average sale price of $429,388 increased by 1.95 per cent from last year.

Carrie Pepper was one of the many caught up in the April activity as she bought a condo in the Thorncliffe-Greenview neighbourhood.

“I wasn’t even planning on buying. I was looking for two months maybe. I found a lot of places that were good prices,” said Pepper who looked at about 10 properties.

“I didn’t want to rent because it’s so expensive. So why not buy?”

She said continued low interest rates played a role in her decision.

“That was huge. This is my first time buying. I know it’s a good time to buy right now,” added Pepper.

Apparently many others felt the same as Pepper.

In the single-family home category, CREB said sales of 1,582 were up 30.64 per cent from last year and the average sale price rose by 0.88 per cent to $483,519.

In the condo apartment category, there were 351 MLS sales, up 13.23 per cent from last year but the average sale price dipped by 5.76 per cent to $267,931.

And in the condo townhouse category, sales rose by 19.20 per cent to 267 with the average sale price increasing by 8.31 per cent to $320,912.

“What we saw in April was strong demand coupled with less good inventory. We also saw lots of multiple offers,” said Cody Battershill, a realtor in Calgary with RE/MAX House of Real Estate.

"I think that everyone’s realizing the world didn’t end and in fact on most metrics we are back to or stronger than most of the previous peaks achieved in the last cycle. Some people think we could be at the beginning of another strong positive economic cycle while others would still encourage cautious optimism. Regardless, living in Calgary means enjoying high economic growth, job growth, income growth and migration.”

He said the economic fundamentals in Calgary are strong and will be for the foreseeable future.

Ann-Marie Lurie, CREB’s chief economist, said the growth in full-time employment, combined with improving migration levels, is translating into improved demand for housing.

“While sales growth does seem exceptionally strong, it is important to keep in perspective that the sales activity in Calgary is returning to levels more consistent with the long-term average,” she said.

CREB said its MLS Home Price Index benchmark price for single-family homes was $449,500 in April, up 7.41 per cent from a year ago. The benchmark price for condo apartments was up 0.77 per cent to $248,300 and it rose by 4.58 per cent in the condo townhouse category to $294,500.

CREB says its new home price index measures how typical properties are valued in the market rather than relying on average and median prices.

It is calculated using a statistical model that estimates prices based on several factors.

In the city, total new listings in the MLS market dipped by 0.49 per cent in April to 3,238 and active listings were off by 16.67 per cent to 5,270.

“While sales activity and the level of new listings continue to remain below long-term trends, the spring market is definitely on the rise over the previous year,” said Bob Jablonski, CREB’s president. “As confidence in the local housing market continues to build, we anticipate a rise in demand, followed by improved listings from those waiting to see some price appreciation prior to listing their home.”

CLIMBING HIGHER!

Canadian house resale prices climb higher
By Eric Lam
Financial Post · Dec. 15, 2011

Canada’s housing market is still chugging along steadily as sales activity nudged higher and prices continued to climb in November, data from the Canadian Real Estate Association said Thursday.


Sales activity rose a seasonally adjusted 0.5% in November, compared with the month before, as about 35,000 houses changed hands.

The national average price increased 4.6%, but that is the smallest increase since January.

Year-to-date sales remained in line with 10-year averages as 432,048 homes have been resold so far in 2011, up 2.1% from year-ago levels.

The sector is showing some signs of slowing down, however, as the number of newly listed homes declined 3.4% between October and November.

That said, actual national home sales figures (not seasonally adjusted) in November actually moved 7% above the 10-year average, the fourth-highest level on record for the month.

“National sales activity picked up late last year, and November’s results suggest that a similar trend may be playing out again this year,” Gregory Klump, chief economist with CREA, said in a release.

Interest rates are expected to remain low for the foreseeable future, so the housing sector will be closely watched for signs of excess, he said.

“That said, current trends for resale housing and new home construction suggest that tightened mortgage regulations are working as intended and fostering economic stability,” he said.

Photo By: Travis Atwood

THE LOGICAL SONG

Housing market to continue to defy logic
Garry Marr
Financial Post,  Dec. 6, 2011

Even one of Canada’s leading real estate companies agrees the rising housing market may not appear to make much sense.

But appearances are deceiving and Re/Max says both sales and average prices will continue to climb in 2012.

“Canadian residential real estate defied conventional logic and outperformed expectations in 2011,” the company said in its year-end report on the market.

Re/Max expects 2011 to finish with prices up 7% and the average home across the country selling for $363,000. The market won’t be as robust in 2012 but consumers can still expect another 2% jump in prices.

Sales figure for 2011 are forecast to climb by 3% from a year earlier with 460,000 homes having changed hands by year end. For 2012, expect less than a 1% increase in activity with only an additional 4,500 sales.

“The Canadian housing market has demonstrated tremendous resilience in recent years but 2011 stands out,” said Michael Polzler, executive vice-president of Re/Max Ontario-Atlantic Canada. “Instead of responding to economic concerns both here and abroad with a retreat in sales and prices, residential real estate markets actually experienced an upswing in the volatile third and fourth quarter.”

Re/Max looked at 26 markets across the country and predicts 23 will show an increase in average price for the year. Sales were up in 22 of those 26 markets. The company says 81% of markets studied will see price increases in 2012.

Among the reasons cited for the Canadian housing market’s continued strength against the odds has been population growth which has gone up by 11% since 2000. Re/Max notes by 2031, the country will have 42 million people.

“Population growth and immigration are major factors expected to prop-up housing demand and household formation in the coming years,” says the company.

Condominiums are expected to continue to garner a growing share of the housing market with investment and income-producing properties in high demand. Low vacancy rates are said to have driven those markets in 2011 and those conditions are expected to continue.

Photo By: Bru76

WHAT TO KNOW ABOUT THE BOOM

What you need to know about Canada’s booming housing market
By Christine Dobby
November 15, 2011

With sales of existing homes in Canada rising in October to the highest level since January, the Canadian Real Estate Association boosted its forecast for resale activity for 2011.

The industry group released data on October sales activity as well as a revised forecast for the year on Tuesday.

National sales of existing homes increased 1.2% from the previous month, building on a gain of 2.5% in September. Price gains however cooled to 5.5%, the smallest gains since January.

A total of 397,561 resale units have traded hands so far this year, CREA said, up 1.8% from levels in the first 10 months of 2010.

Here’s what you need to know about the booming Canadian housing market:

Ontario leads the way

Third-quarter sales activity in the province was stronger than forecast, while the rest of the country came in broadly in line with expectations, the CREA said.

It was the strength of activity in Ontario that prompted the CREA to boost its annual forecast for 2011 to 1.4%, up from 0.9%.

The industry group now predicts national sales of 453,300 for the year, compared with 446,915 in 2010.

198,000 of 2011′s residential sales are expected to come from Ontario, with Quebec and British Columbia expected to have sales of 77,000 and 76,600, respectively.

Home prices are still up but showing signs of cooling down

CREA kept its national average home price forecast for the year little changed at $362,700. That’s an annual increase of 7.0% compared with $339,049 in 2010.

Prices are expected to remain flat next year, with the CREA forecasting $362,700 again for 2012.

The industry group pointed to moderating prices in Vancouver in the third quarter compared with the first half of the year, with sales of multi-million dollar properties in that city returning to “more normal levels.”

CREA said the national average price in October rose 5.5% from a year earlier to just under $362,899, the smallest increase since January.

The balance of supply and demand is tight but the market remains on solid footing

October’s monthly rise in sales resulted in a slightly tighter balance of supply and demand, but the national housing market remains “firmly rooted in balanced territory,” the CREA said.

The national sales-to-new listings ratio, a measure of market balance, stood at 53.4% in October, up from 52.8% in September.

Low interest rates continue to bolster the market

CREA also revised its forecast for 2012 upward slightly, predicting a smaller easing than previously expected of 0.5% to 451,200 units.

The uptick is largely due to expectations that Canada’s interest rates will stay low until well into 2012, CREA said.

But domestic and global economic headwinds could put pressure on the sector

“A number of factors will keep Canada’s housing market in check as interest rates remain low,” said Gregory Klump, CREA’s chief economist.

He pointed to tightened mortgage regulations, high household debt and slower economic and job growth as possible headwinds.

However, Mr. Klump noted that persistent news of global economic uncertainty has put only minor dents in consumer confidence to date.

“How confidence evolves depends on how global turmoil plays out over the coming months,” he said.