Photo: Michael Soron/Flickr
Thanks to strong demand and a supply shortage, Calgary home prices made big gains in the second quarter of this year across all housing types.
According to Royal LePage’s quarterly House Price Survey and Market Survey Forecast, the price of detached bungalows increased by 9.7 per cent to $501,200, condos rose by 9.3 per cent to $286,422, and two-storey homes increased by 7.9 per cent to $489,589.
“Calgary has had a serious inventory shortage dating back to the beginning of 2013, which combined with strong demand from prospective homebuyers is responsible for pushing prices skyward,” said local Royal LePage broker Ted Zaharko in the report. “We definitely have one of the hottest real estate markets in the country right now and all housing types are performing very well. Properties are being gobbled up as soon as they hit the market.”
Another positive sign, says Zaharko, is that active listings are starting to climb.
“Slowly but surely we are seeing inventory levels creep up, which is needed to satisfy the pent up demand after a prolonged period of insufficient supply.”
Looking ahead, Royal LePage forecasts that home prices in Calgary will rise by 5.5 per cent over the year compared with 2013.
“Prices are already up approximately 10 per cent year to date, and we expect this to creep up a little bit more before the end of the year,” said Zaharko. “The Calgary market is vibrant and is home to a strong local economy, fueled by the oil and gas industry. We expect the healthy real estate market to continue for the rest of this year and beyond.”
For the rest of Canada
Nationally, home prices rose in the second quarter of the year for all housing types, with detached bungalows seeing the highest year-over-year gains, rising 5.2 per cent to an average price of $406,454. Meanwhile, standard two-storey homes rose 5.1 per cent year-over-year to $440,972, while the average condo price climbed 3.9 per cent to $258,501.
“Chronic supply shortages are driving price spikes in Canada’s major cities, masking otherwise moderate home price appreciation nationally,” said Royal Lepage president Phil Soper. “While a widening affordability gap in Canada’s largest urban centres is characterizing the national market Canadians read about daily, year-over-year house price increases in most regions of the country are presently tracking below the historical average.”
Looking ahead at the remainder of 2014, Royal LePage is projecting that the national average house price will increase 5.1 per cent.
Want the latest Calgary market news delivered directly to your inbox? Sign up for the weekly BuzzBuzzReport here.