Home prices in Calgary are on the rise. Yes, some of this, at least for the short term, is affected by the recent floods, but that’s not the only factor. Calgary is growing, with more demand for housing while housing inventories are creeping lower, flood or no flood.
The Royal LePage Company just released their latest report this past Tuesday regarding 2013’s second quarter. That report noted an increase of 5.9 percent in the average price of a bungalow, currently just shy of $458,000. Condo prices rose by six percent to over $261,000, while two storey properties, standard category, went up by 6.7 percent to almost $454,000 per unit.
Ted Zaharko, who owns Royal LePage Foothills, noted that all categories are showing lower inventories, consequentially bringing prices up. Also a broker, Zaharko notes an increase in multiple offers on properties and that listings are being snapped up much more quickly. This is benefiting the condominium market, which is not as tight, or as pricey, as the bungalow or two storey categories. Zaharko conceded that the flooding will most likely have some short term effects but he isn’t expecting any long term problems.
Sales numbers are also being affected by the lower inventory, and that’s not expected to improve much until more resale housing units come on the market or new units are built. Even so, the prediction is for a 3.3 percent increase in sales by year’s end. That is in tandem with the predicted 6.5 percent increase in average price also expected by the end of 2013.
Calgary is also doing well in the luxury home market. July has already seen 26 homes change hands with price tags of over $1 million. Four of those homes were sold for more than $4 million. That was as of July 9th. Several of these sales went to people who had their homes severely damaged or destroyed by the floodwaters.
June was also a great month in the luxury category with one home in Crescent Heights selling for $11.1 million and breaking June MLS records in Calgary. And, 74 homes in the $1 million category or better changed hands during the month, another June record. That number was bested only by the 94 homes in that category sold in May. During the first half of 2013, 544 luxury properties changed hands in Calgary.
High end homes along the riverfront were among the hardest hit and the timetable for their reconstruction is uncertain. Most homeowners in this area are well-off, so buying another property to live in while awaiting the fate of their original home was the way to go. Those in more modest areas are also choosing to purchase a second home, where possible, since the rental market isn’t favorable at the moment. Renters who got caught in the floods may also reconsider their housing options after looking at available properties.