Calgary region to see MLS sales and prices rising for next two years

CMHC report says average price to hit $434,000 in 2014

CALGARY — The Calgary region can expect to see increases in both sales and average MLS prices for the next two years, according to a housing forecast released Friday by Canada Mortgage and Housing Corp.

The agency said sales in the Calgary census metropolitan area will grow by 1.37 per cent this year to 27,000 units followed by another 2.59 per cent growth in 2014 to 27,700 transactions.

The average sale price is expected to rise by 2.59 per cent this year to $423,000 and by another 2.6 per cent in 2014 to $434,000.

Christina Hagerty, a realtor with Sotheby’s International Realty Canada in Calgary, said she has had a very busy start so far to the year.

“With Calgary’s industries continuing to hire, I see many people coming from other Canadian centres and the U.S,” said Hagerty. “Specializing in the inner-city market, most of the people we meet are either job transfers and want no commute to work, first-time buyers and empty nesters.”

She said rental vacancy rates are at an all-time low and interest rates have remained historically low as well which have been factors in increasing housing demand.

“All the indicators are continuing to confirm our projections last year that Calgary will be leading the nation,” she said. “Affordable mortgages, record low vacancy rates, continued inward migration and low inventory going into the Spring market makes for a year of healthy growth ahead.”

According to the Calgary Real Estate Board, year-to-date until February 21, total MLS sales in the city of 2,498 are up 11.57 per cent compared with the same period last year and the average sale price has risen by 10.63 per cent to $448,635.

For Alberta, the CMHC is forecasting MLS sales to increase from 60,369 in 2012 to 61,000 in 2013 and to 62,400 in 2014.

In the province, the average MLS sale price is forecast to increase from $363,208 in 2012 to $371,200 this year and to $380,700 next year.

The CMHC report also forecast that housing starts in Alberta will fall from 33,396 in 2012 to 31,800 in 2013 but then rise to 32,200 in 2014.

In Calgary, starts are expected to fall from 12,841 in 2012 to 11,800 in 2013 and then rise slightly to 11,900 in 2014.

“The resale market in Calgary is anticipated to remain in balanced territory over the forecast horizon,” said Richard Cho, senior market analyst in Calgary for the CMHC. “Sales in 2013 are forecast to rise for the third consecutive year but at a more tempered pace compared to the previous year. Low mortgage rates, rising incomes and employment growth will continue to help support housing demand. Some sales will also come from renters who migrated to Calgary in the last couple of years.

“The average price has been gradually trending up, and is expected to continue in 2013. Active listings have declined, lowering the selection of available homes and putting pressure on prices.”

RBC & BNS R AOK

BNS and RBC expected to be winners in next decade
Financial Post
John Greenwood 
November 16, 2010
Canadian banks are at a crossroads. Faced with tougher regulatory rules, a difficult economy and a host of other challenges, players are scrutinizing their crystal balls as they plot their way forward in an environment quite unlike anything they have experienced.

According to UBS analyst Peter Rozenberg, the best way to pick winners of the coming decade is with traditional yardsticks of past performance.

After reviewing 10 years of historical data, Mr. Rozenberg found that while its helpful to look at measures such as provisions for credit losses and product mix, more important contributors to future performance are likely to be growth in earnings per share and return on equity.

“We also used ‘reported’ data as opposed to our usual convention of ‘core’ data, which excludes one-time items,” he said in a note to clients. “While core data is better for establishing trend earnings and valuation, we think reported data provides a better measure of real returns and capital management, over a long period of time.”

The winners? Bank of Nova Scotia and Royal Bank of Canada are best positioned to come out on top, Mr. Rozenberg said.

BNS is at the top of the list because of its geographic diversification and focus on emerging markets in Asia and South America, providing “the best opportunities for capital deployment.”

The Royal comes a close second due to its track record of “superior organic growth,” lower costs and dominant business position.