Photo: Darryl Darwent/Flickr
Easing demand was met with increased housing supply in Calgary last month, but despite the setback, the city’s real estate board is confident the market remains on the path to recovery.
A total of 1,637 homes changed hands last month, falling six per cent below levels recorded a year ago, according to the latest data from the Calgary Real Estate Board (CREB).
Despite the lacklustre sales result, the outlook is positive for the market with year-to-date sales activity coming in at 11,957 units in July, a nine per cent boost compared to levels seen a year ago.
“Sales growth exceeded expectations so far this year. Clients were re-entering the market after delaying decisions until there were some signs of economic improvement,” says David P. Brown, CREB president, in a statement.
“However, this recovery will require patience. There continues to be many new and resale ownership options available. This reduces the sense of the urgency for many consumers,” he adds.
In the detached sector, a total of 1,018 homes sold last month, dropping eight percent compared to July 2016.
Even though detached sales dwindled last month, CREB says the sector continues to show more balanced conditions compared to a year ago.
Attached sales also saw a decline in annual percentage growth, with a total of 363 transactions, down roughly 5 per cent from July 2016.
In the apartment sector, sales saw a modest increase last month with a majority of transactions happening in the City Centre.
A total of 256 apartments sold in July, up a marginal 0.4 per cent from a year ago.
Supply outpaced demand last month as inventory climbed to 6,675 units, a 17 per cent jump from levels seen a year ago, but not quite meeting record highs seen in July 2008.
An abundance of new listings also hit the market with 2,981 units, representing an 11 per cent increase from July 2016.
With more homes available and easing demand, city-wide months of supply rose to four months compared to three months last year in July.
CREB chief economist Ann-Marie Lurie credits the city’s real estate turnaround to improvements in the labour market and net migration, but says achieving market stability will take some time.
“Current inventory levels and changes in the lending market continue to weigh on housing demand. Easing demand growth combined with elevated levels of supply will slow the pace of price recovery in our market,” says Lurie in a statement.
Driven by detached and attached home sales, the benchmark price tag of a home in the city was $443,600 last month, up 2 per cent from July 2016.
However, this jump in price growth is still roughly four per cent below previous monthly highs.
Last month, a detached home’s benchmark price was $512,100, up two per cent from July 2016.
The benchmark price of an attached home also increased last month to $336,300 — 1.3 per cent higher than July 2016.
Conversely, there continues to be an oversupply of apartments in the resale and new home sector, causing prices to drop. In July, the benchmark price of an apartment was $266,200, dipping 3 per cent compared to a year ago.