Calgary home sales fell 12.6 per cent year-over-year in July, and according to Calgary Real Estate Board (CREB) Chief Economist Ann-Marie Lurie, rising unemployment and lower net migration in the city are largely to blame.
“Continued pullback of sales activity is a sign of economic conditions,” she said in a press release, adding, “[t]he number of unemployed workers keeps rising and when you combine job losses with declining net migration, the result is going to be weaker housing demand.” Calgary has now experienced year-over-year home sales declines for 20 months in a row.
One bright spot in the market is that new listings declined along with home sales in July. CREB notes that just 2,684 homes were listed last month, down from 3,101 in June and from 2,988 in July 2015.
The fall helped prevent inventory gains, which in turn helped reduce pressure on Calgary’s benchmark home price. It came in at $440,000 in July, and while that’s a decline of 4.2 per cent year-over-year, it’s only slightly lower than the June level. Interestingly, benchmark home prices have fallen much more significantly in some districts of Calgary than they have in others — year-to-date the City Centre region has experienced a drop of 5.1 per cent, while the North East area has seen a fall of just 0.8 per cent.
Different home types have also seen sizeable differences in benchmark price declines. For instance, while the benchmark price for a detached Calgary home was $502,300 in July, down 3.4 per cent year-over-year, the city’s apartment benchmark was down 6.6 per cent from last July at $277,000. Semi-attached and row homes saw year-over-year benchmark price falls of 3.1 and 5.5 per cent, respectively.
CREB attributes the larger benchmark price decline for apartments to the fact that apartment inventory has been high in 2016. So far this year, the apartment sector has averaged 6.3 months of supply, much higher than 3 and 4.2 months for detached and attached homes.
Overall, CREB President Cliff Stevenson sees July’s home sales and price activity as unsurprising. “To buyers and sellers that have been paying attention to the housing market in Calgary and surrounding areas, it should come as no surprise that we continue to see a slowdown in sales activity,” he said.