Prices steady, but struggles in Alberta economy weighs on housing
Changes to the lending industry and a challenging economic recovery are weighing on sales activity in Calgary's housing market.
Supply levels have not adjusted to the weaker demand environment, and that is preventing price recovery.
"Slower sales do not come as a surprise, given the economy has not yet improved enough to offset the impact of changes in the lending industry," said CREB® chief economist Ann-Marie Lurie.
"While the rising inventories are being monitored, prices have remained relatively flat as gains in some areas of the city have been offset by declines in other areas."
The easing sales trend persisted through April in Calgary's housing market. Calgary sales totaled 1,518 units in April, which is 20 per cent below last year and 25 per cent below long-term averages.
The detached sector has seen the largest decline, with year-to-date sales totaling 2,991 units, 27 per cent below the 10-year average.
Inventory levels in April totaled 7,324 units. This is a 32 per cent rise over last year, but well below the monthly high of 10,129 units recorded in 2008. Supply compared to demand has risen, but city-wide prices have remained relatively stable, totaling $436,500 in April, a monthly and annual gain of 0.21 per cent.
"The reality is that there's selection heading into the active spring market," said CREB®president Tom Westcott.
"For many sellers, they have to decide what price they are willing to accept for a lifestyle change. At the same time, buyers need to understand the supply dynamics and price movements in the specific area, as they may not align with their expectations."
So far this year, apartment and attached sales have eased to levels that are comparable to 2016. However, rising supply in both markets have pushed months of supply to the highest levels recovered over this four-month period, which is preventing any significant shifts in pricing trends.
Housing Market Facts
Detached sales activity slowed across each district in the city, causing inventory gains. Inventory levels were only significantly higher than long-term averages in the North district, which is likely a reflection of the growth coming from new communities.
Price changes in the detached market have varied in each district. Year-to-date, the districts seeing price declines have been limited to the North, North East and East districts. Prices remain over three per cent higher than last year in the City Centre and West districts. City wide detached prices average $502,625 this year 0.49 per cent higher than last year.
Year-to-date apartment condominium sales totaled 823 units. This is 15 per cent below last year and 27 per cent below long-term averages. New listings have eased slightly over last year, but inventory levels remain elevated, keeping months of supply well above seven months.
Elevated supply based on sales continues to weigh on apartment condominium prices. In April, the benchmark price totaled $256,700. This is nearly three per cent below last year and 14 per cent below monthly highs recorded in 2014.
Year-to-date semi-detached prices remained relatively unchanged over benchmark prices from last year, as gains in the City Centre, North East, West, South and East districts were offset by declines in the North, North West and South East areas.
After the first four months of the year, row prices remain nearly one per cent above levels recorded last year. Like many other property types, price trends vary depending on the district. Year-over-year price adjustments range from a 1.86 per cent increase in the City Centre district to a 6.14 per cent decline in the South district.
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