The single-family market continues to tighten, with months of supply dropping below three months. Sales growth continues to outpace new-listings activity, placing downward pressure on inventories. As the market tightens, single-family homes are selling quicker, and there has been some upward pressure on pricing. The MLS® Home Price Index for the month of April recorded a year-over-year price increase of 5.5 per cent for a total benchmark price of $449,500.NOTE: The single family benchmark price has been pushed up to levels comparable to those recorded in 2007, but the index continues to remain below peak levels. Why the difference? This is mostly due to the community weighting factor inherent in the benchmark price. The index figure does not have the same bias, and therefore is a better measure of the true price appreciation in the market.
“While the balance between demand and supply in the single-family market has shifted towards sellers’ territory, there are several components that make today’s market different from five years ago,” says Bob Jablonski, president of CREB®. “The main difference is there is still significant supply for consumers in surrounding towns and the condominium market in the city, and the new-home builders do have the ability to absorb some of the excess demand,” Jablonski adds.After the first four months of the year, the condominium apartment sales totaled 1,133, a 2.2 per cent increase over the same period last year. Tighter supply in the single-family market has translated to improved demand for condominium apartments, and consumers active in this market have a sufficient amount of supply and new listings to choose from.New condominium apartment listings for the month of April rose by 5.9 per cent compared to last year, and remain at similar levels on a year-to-date basis. As the gap between inventories and sales narrows, the months of supply continues to trend toward levels that are more consistent with a balanced market.
While the condominium apartment market moved into more balanced territory, index prices remain relatively unchanged. The condominium townhouse market is trending in a similar fashion to the single family market, and recorded a year-over-year index price increase of 2.7 per cent. Overall for the month of April, the condominium townhouse and apartment markets recorded a benchmark price of 294,500 and 248,300, respectively.
Posted in: Market Trends
Calgary residential sales total 2,200 for the month of April, a 26 per cent increase over levels recorded last year!
My personal experience over the last month is that sellers that are appropriately priced and well presented as selling within a short window with multiple offers becoming more common. Sellers can use pricing strategies to their advantage in ways that weren't possible for some time.
Staging has improved the bottom line for many of my sellers recently. Buyers are looking for value and are still adjusting to a market that is moving quicker than before. Buyers are still carefully reviewing comparables and prices and some even have concerns about potential negative impacts on the real estate market by changes to CMHC and other national pressures. Although statistically we are moving towards a sellers market, buyers still have many options. That being said, good homes are moving so buyers need to be preapproved and educated before submitting an offer.
Interest rates are low. Employment and migration numbers are strong. Momentum is building. The new index and benchmark pricing information is showing a positive increase in property price as are more traditional values. Regardless of the overall numbers, a review of comparable listings and sales will give you the information you need to understand pricing trends for your sale or purchase. Where will prices move? It depends on the ebb and flow of new listings. Many sellers have been waiting for a price increase before listing so we will see how the market adjusts to this recent sales surge.
Some notable info from the CREB press release: