LOOKING NORTH

Demand increases for resale homes
By Josh Skapin 
Calgary Herald October 4, 2013  

Sales of single-family resale homes climbed 20 per cent in September compared to sales a year earlier, with tight market conditions creating higher prices, says the Calgary Real Estate Board.

“The impact of the floods likely boosted sales throughout July and August, and it appears as though some of that additional demand is starting to ease,” says chief economist Ann-Marie Lurie of CREB.

“Nonetheless, sales growth remains strong, in part because net migration has been stronger than anticipated and rental product is in short supply.”

Net migration describes the inflow of people to the city minus the outflow.

During September, 1,354 homes changed hands, up 20 per cent from 1,126 during the same time in 2012, says CREB.

The benchmark price of single-family homes in Calgary was $463,700 in September, a seven per cent upswing from $432,900 during the same month last year. The benchmark price is that of a typical home based on a formula that uses various factors to ensure accurate comparisons.

“While prices show strong year-over-year gains, if the level of new listings continues to improve relative to sales activity, prices should level off for the remainder of the year,” says Lurie.

Homebuyers have seen about the same selection this year compared to a year ago. There were 18,949 new listings between Jan. 1 and the end of September, a slight decline of 0.2 per cent from 18,881 during the same span in 2012.

However, the market saw a turnaround for new listings in September.

Last month, 1,975 single-family resale homes were added to the market, five per cent more than the 1,887 during this time last year.

From Jan. 1 to the end of September, 13,006 single-family homes were sold on Calgary’s resale market, a seven per cent improvement over the 12,186 transactions during the same period last year.

The quadrant with the most single-family house sales in the city during September was the northwest.

The board’s Zone A, which roughly consists of the northwest, finished the month with 467 transactions.

The next busiest quadrant was the board’s Zone C with 357 homes changing hands during September. This zone roughly consists of southwest Calgary.

At the same time, the board’s Zone D had 299 deals, while 231 homes sold in the board’s Zone B. Zone D roughly covers the southeast quadrant and Zone B is mostly the northeast side.

NORTHWEST LEADS REST

The two communities that saw the highest single-family home sales in the city in September were both in northwest Calgary.

Tuscany led the city in sales with 34 deals at an average sale price of $535,688, says the Calgary Real Estate Board. Panorama Hills had the second highest sales with 31 transactions at an average price of $487,477.

For information, visit creb.com

BLAZING AHEAD

Canada’s housing market steams ahead
Reuters  Oct 11, 2011

TORONTO — Canadian housing starts jumped much more than expected in September, helped by a surge in the condominium sector, suggesting Canada’s property boom stayed intact last month and should help the economy avert recession.

Canada Mortgage and Housing Corp. said on Tuesday that starts rose to seasonally adjusted annualized rate of 205,900 units last month. August starts were revised up to 191,900 from 184,700.

September starts far exceeded the consensus expectation of analysts, who had called for 188,000.

Driving the gains were a jump in construction of multi-residential buildings such as condominiums.

“Housing starts picked up in September due to an increase in multiple starts in the Atlantic region, Quebec and in British Columbia,” Mathieu Laberge, a deputy chief economist with CMHC said in a statement.

“Multiple housing starts are expected to move back toward levels consistent with demographic fundamentals in the near term.”

The agency said urban starts increased by 8% to 185,900 units in September, with multiple urban starts up by 14.2% to 118,000 units. Single family housing starts in urban areas decreased by 1.5% in September to 67,900 units.

Rural starts were estimated at 20,000 units.

CIBC World Markets economist Emanuella Enenajor said in a note to clients that while multiple starts are widely expected to scale down in the months ahead, residential construction could be a plus for GDP in the third quarter.

Canada’s economy contracted marginally in the second quarter, partly due to the supply chain impact of Japan’s earthquake and tsunami. There had been fear the economy could shrink again in the third quarter, meeting the textbook definition of a recession.

But recent data has been encouraging. A report on Friday showed Canada created six times as many jobs as expected in September, helped by an economy that is largely humming along even as other rich nations struggle with debt and slumping confidence.

Canada’s housing sector has played a major role in the recovery. The country avoided the subprime housing boom that drove the United States into recession and helped trigger the global financial crisis.

Property prices and sales briefly weakened after the crisis. But the Bank of Canada’s decision to cut interest rates to a record low, which pulled mortgage rates lower, fueled a fresh boom.

The housing boom was helped along by the fact Canada’s conservative banks escaped the crisis largely unscathed and were able to keep lending.

The fear now for many policymakers is a fresh asset bubble could be in the works.

SALES ON THE RISE

Home sales, prices up in September
Garry Marr, Financial Post · Friday, Oct. 15, 2010

TORONTO — Housing sales rose in September for a second straight month while average prices reversed the falling trend with a 1.9% increase from August, the Canadian Real Estate Association said Friday.

The Ottawa-based group said sales in September climbed 3% from August on a seasonally adjusted basis. It was the highest number of sales since last May.

At the same time prices also showed some growth. The average sale price across the Multiple Listing Service last month was $331,089, on par with where it stood a year ago, and an increase from $324,928 in August.

"Supply and demand are rebalancing, and that's keeping prices steady in many markets," said Georges Pahud, president of CREA.

With demand improving slightly and the supply of homes falling, the number of months of inventory in the market dropped for a second straight month, the group said. New listings remain 15% below the peak reached in April.

CREA said two-thirds of local markets posted sales increases with Winnipeg, Calgary and Montreal standing out. However, compared with last year sales still lag across the country, down 19.8% in September from a year ago.

"Record level sales activity late last year and earlier this year is expected to further stretch year-over-year comparisons in the months ahead," the group said.

CREA said on a seasonally adjusted basis there was 6.6 months of inventory in the market nationally. That's down from 6.9 months in August and 7.2 months in July. The number of months of inventory represents the number of months it would take to sell inventories at the current rate of sales activity.

The interest-rate environment continues to help the housing market. While the prime lending rate has jumped with recent interest rate hikes from the Bank of Canada, effecting variable-rate mortgages, long-term rates continue to fall. Some lenders are now loaning money as low as 3.5% for a five-year, fixed-rate term.

"Mortgage lending rates eased in the third quarter, which helped support sales activity over the past couple of months," said Gregory Klump, chief economist with CREA. "Interest rates are going nowhere fast, so home ownership will remain within reach for many homebuyers."

AN UPHILL CLIMB!

CALGARY - Activity in Calgary’s residential MLS market picked up in September after a number of months where demand for housing was cooling.

But year-over-year sales remain down.

According to the Calgary Real Estate Board, which released official MLS data today, MLS sales on a year-over-year basis were down in September for the fifth consecutive month.

However, the board also reported that single-family home sales during the month broke a string of five consecutive month-over-month declines and the condo market ended a streak of four straight monthly declines.

In September, there were 958 MLS single-family home sales in Calgary for an average price of $460,278, up from 867 sales and an average price of $445,617 in August. In September 2009, there were 1,257 sales at an average of $459,085.

There were 366 condos sales in September, up from 364 in August, but down from 580 in September 2009. The average sale price in September was $284,028, down from $286,384 the previous month and $290,253 a year ago.

“There are signs that September may mark a gradual, if not slight, uptick for Calgary’s housing market - we are seeing modest improvement since the market’s decline, that really started in April of this year,” said CREB president Diane Scott.