Calgary’s property market is turning out to be just as crazy and unpredictable as the flood waters that recently covered a great deal of the city and a good portion of southern Alberta. Many of the damaged properties that fronted the Elbow River were of the luxury variety, owned by millionaires. Many of them opted to buy another property to live in while they sorted out what to do with their original home. Some of those damaged properties may be repaired; others will prove to be total washouts.
All of these wealthy folk are snapping up the offerings in Calgary’s luxury home market. Suddenly it is very easy to sell a multi-million dollar home far and above the asking price. As bidding wars ensue, property owners are averaging sales for more than ten percent over list price.
This surge in the luxury market is having an effect on more moderately priced properties. Homes going on the market are getting multiple bids, often selling within days of listing and at higher price points. The entire flood situation has managed to inflate property prices across economic lines. The lack of available rentals is also forcing people to consider buying and/or moving out to the suburbs, or beyond.
Then there are speculators snatching up properties with the hopes of reselling at a higher rate. That may or may not work. It is just as likely that homes built in the more flood-prone parts of town may decrease in value. If those homes aren’t moved quick enough these folks may end up underwater financially.
But homes on high ground are expected to hold their value, not only in the hot and bothered real estate world of this July, but in the future. Yes, July is hot this year, real estate wise. This is the time of year that agents can usually take a breather, venture away from home for a few days and not worry too much about the office. Not this year.
As an example, one recently listed suburban home in the city’s south end went on the market and within the first eight days it was shown 19 times. That’s a lot of foot traffic for July. Those in the rental real estate world are similarly busy, fielding applications and trying to find living space for those who can’t or don’t want to buy.
The general feeling is that the real estate market in Calgary will be tight, at least for the short term. It will most likely be tougher to get financing and/or insurance on homes in certain areas, thus delaying sales while these types of conditions are met.
The same goes for repairing and replacing homes in the flood’s path. Certain government aid will be available to help with the rebuilding, but it does come with conditions for some areas. If you choose to rebuild at the water’s edge, then part of that rebuilding must be the construction of berms and/or the raising of your home on stilts or blocks to avoid damage. Other financial assistance is offered for those willing to relocate away from the flood zones.
Calgary has bounced back from floods before and it is expected the people will once again return to the downtown core and the preferred neighborhoods along the waterfront. Calgarians love the vibe of the city as well as the proximity to Mother Nature, even if they do have to put up with one of her soggy tantrums once in a while.