Calgary’s real estate market is doing just fine, particularly in the resale sector. The Canadian Real Estate Association, or CREA, noted that the city had the nation’s highest rate of sales increases this past October. In a data report released this past Thursday by MLS, the city showed 2,104 sales with an average increase of 26.7 percent for the month. Compare that to the national decrease of 0.8 percent where 35,971 units, in total, changed hands.
BMO Capital Markets’ Robert Kavcic, an economist, credited the strong income and population growth for the increased housing demand. The excess supply has dwindled, meaning prices are on the rise and the market just entered into the seller’s domain. This October saw a five percent price increase over October of 2012, with an average of $418,721 per home.
Nationwide the average price was $363,516, virtually the same as in October of 2011.The nationwide sales were also well within the 10-year price average. This means that in much of Canada, the market is stabilizing and becoming more sustainable over the long run.
Markets in Saskatchewan and Alberta are picking up steam while once active sales locales like Greater Vancouver have slowed down. Alberta saw 4,185 sales this past October, a 17.5 percent increase over October of 2011. Sales prices averaged $363,295, a 3.5 percent increase.
The Home Price Index of MLS, looking at benchmark prices, saw an increase of 3.6 percent nationwide in seven of the surveyed markets. This is the sixth month in a row that saw a slowdown in price increases, which was the slowest seen since May of 2011. Regina actually saw the highest price increase, coming in at 12.98 percent. Calgary was next at 6.76 percent.
Gains during the first six months of 2012 were moderate, but steady. The second half of the year was affected by the change of mortgage rules, implemented in July. This caused a bit of a cool down, expected to ease by the early part of 2013. The still low interest rates and increased demand for housing due to more jobs and more people filling those jobs will increase market activity. As of now, the Bank of Canada is not expected to raise interest rates until the latter part of 2013, which helps the market increases.