Market imbalance in Calgary’’’s residential resale housing market continued to weigh on citywide prices in April.

Much like the previous month, year-over-year sales fell while new listings increased, resulting in inventory gains across all sectors of the market.

As a result, benchmark prices in the city declined by 0.4 per cent from last month, and 3.4 per cent from last year, to $441,000.

For sellers, the reality of seven consecutive months of price declines has started to sink in, said CREB® president Cliff Stevenson.

“From re-considering the listing of their home to lowering expectations on price, sellers are beginning to adjust to the current market reality,” he said. “However, some buyers in the market are still not willing to pull the trigger because they expect even bigger discounts. And so that gap between buyers’ and sellers’ expectations still persists across many product types and locations.”

Despite this, the detached sector fared better relative to the other sectors of the market. While detached sales activity has fallen by over four per cent so far in 2016 compared to last year, the sales to new listings ratio improved in April. This prevented sharper inventory gains and caused months of supply to move toward more balanced levels.

The same cannot be said of other market sectors. Year-to-date apartment and attached sales declined by a respective 19 and 13 per cent compared to last year. Slower sales, combined with rising inventories, ensured that market conditions continued to favour buyers in these segments.

“While the weak economic climate is influencing demand, the apartment and attached sectors are further impacted by increased supply in the competing new home sector and rental markets,” said CREB® chief economist Ann-Marie Lurie. “This is one of the contributing factors to the steeper price declines recorded in the apartment sector.”

Since the start of the price declines, monthly unadjusted benchmark apartment prices have declined by 7.6 per cent, while semi, row and detached have declined by a respective 5.9, 4.6 and 4.1 per cent.

CREB
Housing prices trend down in March
Unemployment impacting housing activity

Home prices declined further in March as economic conditions weigh on Calgary’s housing market.

Calgary’s benchmark price totaled $442,800 in March, a 0.49 per cent decline over February and 3.51 per cent lower than levels recorded last year.

“With no improvement in the labour market, it’s no surprise that we continue to face downward pressure on housing sales activity and prices,” said CREB® chief economist Ann-Marie Lurie.

“Provincial unemployment rates are at the highest level recorded since the early ‘90s,” said Lurie, adding that Calgary’s unemployment rate in February rose to 8.4 per cent, which is higher than the provincial average of 7.9 per cent.

March home sales in Calgary totaled 1,588 units, 11 per cent below the same time last year and 28 per cent lower than long-term averages for the month.

Calgary also saw housing supply gains in most price ranges. Inventory levels rose by seven per cent to 6,084 units in March. Overall, months of supply has averaged five months in the first quarter of 2016.

“As we move into spring, we are starting to see more foot traffic at open houses and showings from potential buyers,” said CREB® president Cliff Stevenson. “For now, this activity hasn’t translated into improved sales in most segments of the market.”

The apartment sector has been the hardest hit by the recent downturn. After the first quarter of the year, apartment sales totaled 554 units, a 17 per cent decline over the same period last year.

Apartment benchmark prices have been trending down since late 2014. In March, benchmark apartment prices totaled $281,300, seven per cent lower than levels recorded prior to the slide and 4.93 per cent lower than levels recorded last year.

The detached and attached sector has also felt the brunt of Calgary’s weakening economy. Detached and attached home prices have dropped by four per cent from the recent peak.

“Homebuyers continue to wait and see if there are going to be further declines in home prices before making an offer,” said Stevenson. “Timing the bottom of the market is proving to be quite a challenge in the housing market we are faced with now.”

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Alberta home sales remain down year-over-year in February

The Alberta Real Estate Association (AREA) compiles provincial MLS® sales data for dissemination to REALTORS® and other interested groups. The data that is provided represents statistics provided to AREA by way of the Canadian Real Estate Association (CREA). For more detailed statistical information for Boards/Associations or for individual areas, contact your local real estate Board/Association or your local REALTOR®.

The Alberta Real Estate Association (AREA) reports that a total of 3,170 residential unit sales were recorded through the MLS® Systems of real estate Boards/Associations in Alberta in February, down 8.0 per cent from the same month last year. The average MLS® residential price increased 0.6 per cent from February 2015 to $388,037.

Housing market remains unchanged in January

Slow sales activity and inventory gains place downward pressure on prices

Calgary’s housing market is starting 2016 firmly in buyers’ market territory, much the same as last year ended.

“The recent slide in energy prices has raised concerns about near-term recovery prospects for the city,” said CREB® chief economist Ann-Marie Lurie. “Energy market uncertainty and a soft labour market are weighing on many aspects of our economy, including the housing sector.”

City wide, January sales totaled 763 units, 13 per cent below last year and 43 per cent below long-term averages. While new listings declined by 16 per cent compared to January 2015, the number of new listings far outpaced the sales, causing inventory gains. January’s city wide months of supply levels rose above six months.

“Selection for buyers in all product types and price ranges has improved,” said CREB® president Cliff Stevenson. “More choice and low interest rates have encouraged some potential buyers to start window shopping. So far, this hasn’t translated into sales activity as many are waiting for steeper price declines from motivated sellers.”

The aggregate benchmark price of $447,300 in January was 1.21 per cent lower than the previous month and 3.27 per cent below the January 2015 price of $462,400.

“As expected, the imbalance between housing supply and demand is continuing to place downward pressure on prices,” said Lurie. “However, the recent price retraction has not erased all the gains recorded in recent years, as the benchmark price remains 4.41 per cent above the January 2014 price of $428,400.”

While all property types have recorded price contractions from recent highs, the largest price declines have occurred in the apartment sector as this segment has had elevated months of supply since the second quarter of 2015.

The apartment benchmark price totaled $281,900 in January, a year-over-year decrease of 6.35 per cent and 2.12 per cent lower than the previous month’s price. In fact, apartment sector prices have once again fallen below the 2007 monthly high of $301,500.

The detached segment of the market continues to show variations depending on price range. The under $500,000 segment remains relatively balanced. However, recent trends are pointing to weaker sales-to-new-listings ratios in the $500,000 to $600,000 range of the market.

“Calgary’s housing market continues to face a wide range of challenges,” said Stevenson. “Sellers are reflecting on their expectations and considering all options available to them, given the dynamics of their specific market. In this environment, buyers have the opportunity to carefully consider their housing needs and make a decision based on their lifestyle and future goals

Alberta home sales down year-over-year in January

The Alberta Real Estate Association (AREA) compiles provincial MLS® sales data for dissemination to REALTORS® and other interested groups. The data that is provided represents statistics provided to AREA by way of the Canadian Real Estate Association (CREA). For more detailed statistical information for Boards/Associations or for individual areas, contact your local real estate Board/Association or your local REALTOR®.

The Alberta Real Estate Association (AREA) reports that a total of 2,277 residential unit sales were recorded through the MLS® Systems of real estate Boards/Associations in Alberta in January, down 13.8 per cent from the same month last year. The average MLS® residential price decreased 2.7 per cent from January 2015 to $371,620.

Three of Alberta’s ten real estate Boards/Associations saw an increase in monthly residential average prices from year-ago levels:

Board Year-Over-Year Change
Alberta West +13.1 per cent
Fort McMurray Region +2.7 per cent
Calgary Region +0.4 per cent

The seven remaining Boards/Associations saw the monthly residential average price decrease to varying degrees from January 2015:

Board Year-over-Year Change
Lethbridge Region -0.9 per cent
Grande Prairie Region -5.3 per cent
Central Alberta -7.7 per cent
Medicine Hat Region -8.4 per cent
Edmonton Region -8.4 per cent
Lloydminster Region (AB Only) -9.9 per cent
South Central Alberta -38.5 per cent

Note: The data above is national data and may not perfectly reflect the data reported by a Board/Association. The numbers represented are for the full Board/Association region, rather than city/town proper areas that may be reflected in a board’s name. Click here for a general guideline of Board/Association boundaries.

The value of all home sales in the province totalled $846 million for the month, falling 16.1 per cent from January 2015.

There were 9.8 months of inventory at the end of January 2016, up from 7.4 months at the same time one year ago.

New listings on the MLS® Systems of real estate boards in Alberta numbered 8,559 units in January, a decrease of 8.5 per cent from a year earlier, while active residential listings numbered 22,362 units at the end of January, up 15.1 per cent from one year earlier.

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From CREB Nov. 2/15
Prices decline for the second consecutive month

Sales activity remains well below long-term averages

Elevated inventory levels in October contributed to a second consecutive month of price declines in Calgary’s resale residential housing market.

Benchmark prices declined 0.7 per cent from the previous month, and 1.2 per cent from the same time last year, to $453,100.

“Persistent weakness in the overall economy continued to impact housing demand in Calgary as October sales were nearly 16 per cent below long-term averages,” said CREB® chief economist Ann-Marie Lurie.

“In addition, new listings did not decline enough to prevent inventory gains and, ultimately, price contractions.”

The steepest declines occurred in the apartment sector, where the benchmark price fell to $288,300, a 0.8 per cent decline from September and nearly four per cent from the same time last year.

Lurie attributed the declines to a continued rise in months of supply – from a low of three months in June to nearly six months in October.

“That sector is facing added competition from several new apartment projects, improved vacancy in the rental market and more supply in the attached sector,” said Lurie, noting months of supply in the sector has remained above four since August.

“When combined with a steep pullback in demand, it creates conditions that generally favour the buyer.”

Aggregate prices in both the detached and attached sector also recorded both monthly and yearly declines, but were moderate compared to apartments due to less severe drops in absorption levels.

“In this type of market, both sellers and buyers need to have those hard discussions with their real estate professionals about their objectives,” said CREB® president Corinne Lyall, noting increased competition from both the rental and new home markets.

“If sellers are serious about selling, they need to consider how they are positioning their home on the market. Buyers, meanwhile, have to consider whether that home satisfies their lifestyle needs.”

Overall, October sales in the city declined by 33 per cent year-over-year to 1,421 units, with year-to-date sales falling by more than 26 per cent.

Meanwhile, inventory levels during the month remained at 5,578 units, pushing months of supply up to 3.93.

Market balance in the detached sector, which accounts for more than 60 per cent of all sales in the city, varied depending on price segment.

More than half of detached sales in October occurred below $500,000, where demand relative to supply remained relatively tight – thereby potentially offsetting some of the price losses in the higher end of the segment.

“Sales activity has varied depending on market segment and price,” said Lyall.

“For example, while some price adjustments have occurred in the higher-end detached category, this is less likely for the under-$500,000 detached segment, which had more balanced conditions.”

Jan 22/16 Market Report from AREA

Alberta home sales down year-over-year in December

The Alberta Real Estate Association (AREA) compiles provincial MLS® sales data for dissemination to REALTORS® and other interested groups. The data that is provided represents statistics provided to AREA by way of the Canadian Real Estate Association (CREA). For more detailed statistical information for Boards/Associations or for individual areas, contact your local real estate Board/Association or your local REALTOR®.

The Alberta Real Estate Association (AREA) reports that a total of 2,532 residential unit sales were recorded through the MLS® Systems of real estate Boards/Associations in Alberta in December, down 17.4 per cent from the same month last year. The average MLS® residential price edged down 0.3 per cent from December 2014 to $389,486.

Six of Alberta’s ten real estate Boards/Associations saw an increase in monthly residential average prices from year-ago levels:

Board Year-Over-Year Change Year-to-Date Change
Lloydminster Region (AB Only) +29.9 per cent +0.7 per cent
South Central Alberta +15.3 per cent -4.0 per cent
Lethbridge Region +14.6 per cent +2.5 per cent
Alberta West +2.4 per cent 0.0 per cent
Medicine Hat Region +1.9 per cent +4.0 per cent
Edmonton Region +1.0 per cent +1.9 per cent

The four remaining Boards/Associations saw the monthly residential average price decrease to varying degrees from December 2014:

Board Year-over-Year Change Year-to-Date Change
Calgary Region -0.4 per cent -1.5 per cent
Central Alberta -1.0 per cent +0.3 per cent
Fort McMurray Region -2.2 per cent -6.2 per cent
Grande Prairie Region -5.0 per cent +0.4 per cent

Note: The data above is national data and may not perfectly reflect the data reported by a Board/Association. The numbers represented are for the full Board/Association region, rather than city/town proper areas that may be reflected in a board’s name. Click here for a general guideline of Board/Association boundaries.

The value of all home sales in the province totalled $986 million for the month, falling 17.7 per cent from December 2014.

There were 7.9 months of inventory at the end of December 2015, up from 5.1 months at the same time one year ago.

New listings on the MLS® Systems of real estate boards in Alberta numbered 4,558 units in December, an increase of 13.7 per cent from a year earlier, while active residential listings numbered 20,067 units at the end of December, up 27.9 per cent from one year earlier.

Click here for the full release, including a breakdown of information by area. For more detailed statistical information, contact your local real estate Board/Association or your local REALTOR®.

expected in 2016, adding to an already elevated level of inventory. In this situation, the markets ability to effectively absorb more inventory will be limited, resulting in some downward price pressure across all housing sectors.

“As we move into the second year of this environment, we expect to see additional housing supply pressure and further price declines,” said CREB® chief economist Ann-Marie Lurie. “Weakness in the energy sector is overshadowing all aspects of our economy and with more people looking for work and fewer opportunities, we could see some families making adjustments to their housing situation.”

While price declines are forecasted in each of the detached, attached and apartment markets, steeper declines are anticipated in the higher density segments, a trend which already started in the fourth quarter of 2015. This is related to the near record high level of multi-family units under construction. As these units are completed, there will be more product available for a smaller pool of buyers.

“Market intelligence really matters in today’s operating environment. Pricing trends have and will continue to vary depending on product type, price range and location,” said CREB® president Cliff Stevenson. “Sellers in this market need to have a good understanding of activity within their specific niche of the market. This is where a real estate professionals can really help navigate market conditions and real estate options, which are always unique to each consumer.”

With oil prices expected to remain lower for a longer period of time, the additional impact on employment and the extent of the spillover to other industries is still uncertain. While current forecasts expect employment weakness to persist throughout 2016, further losses are not expected beyond this year.

“The main risk to the housing outlook lies with the deepness of the pullback in demand and how that will translate into supply gains,” said Lurie. “Any sign of sustained recovery in the energy sector could limit the impact on the housing market.”

Housing market conditions favour buyers

Weak sales activity relative to inventory places downward pressure on prices

Calgary, Dec. 1, 2015 – Persistently high inventory levels within Calgary’s residential resale housing market, combined with weak sales activity, contributed to buyers’ conditions in November.

Monthly sales totaled 1,263 units, a 28 per cent decline from last year and nearly 20 per cent below the 10-year average. Meanwhile, the amount of new listings in the market increased by five per cent over last November, and moved five per cent above 10-year average.

The combination of both soft sales and elevated listings caused months of supply to rise above four months. It represents the third consecutive month that housing supply in the city has remained near four months, which is an indicator that supports buyers’ conditions.

“The housing market is reflecting the realities of the economic conditions,” said CREB® chief economist Ann-Marie Lurie. “Calgary has continued to post job losses in the energy sector, unemployment levels are high, wages are down and recovery expectations have changed. All of these factors have contributed to the weak demand we have seen throughout the year.”

CREB® president Corinne Lyall pointed out that inventory levels still remained 27 per cent below the November highs recorded in 2008.

“Furthermore, price declines have not been as steep as those recorded during the last downturn,” she said.

The unadjusted benchmark price in November declined to $450,700, a 0.5 per cent drop compared to last month and two per cent from last year.

Calgary’s detached housing sector faired the best in November as months of supply increased to only 3.4. Nonetheless, the unadjusted benchmark price declined by 0.6 per cent compared to October, and 1.52 per cent from November 2014, to $510,700.

In the attached category, buyers’ conditions emerged as months of supply increased to 4.8. As a result, the unadjusted benchmark price declined to $352,400, a 0.5 per cent drop from last month and 1.5 per cent from last year.

The apartment sector continued to be the hardest hit of the three sectors. Months of supply increased to 6.9 in November, causing benchmark prices to slide 0.5 per cent from October to $287,000. Meanwhile, year-over-year prices were off by 4.6 per cent.

Despite weaker absorption rates for most of 2015, residential benchmark prices have only recently started to decline – while average and median prices have dropped more dramatically. Lurie attributed that to slower activity in the higher-priced segments of the market, which can skew average and median prices.

Benchmark prices represent changes for similar-type homes, minimizing the impact caused by changes in distribution.

“It is not a surprise that the average price has recorded a steeper decline than the benchmark price,” she said. “Last November, detached sales in the city over $700,000 totaled 159 units or 15 per cent of the market sales. This November, there were only 103 sales representing 13 per cent of the market sales.”

Lyall said knowing the difference between indicators such as average, median and benchmark prices is important for sellers.

“There is no question that this can be a challenging market,” she said. “However, because of these circumstances there is a greater need for market intelligence.”