June was an eventful month in real estate here in Calgary and in Canada. With sales and pricing continuing to show upwards trends in June, the end of the month saw the announcement of new mortgage rules to be very shortly implemented throughout Canada. The CREB stats package is an indication of what was last month but there is much speculation about future trends ranging from very negative to generally positive. Some folks are speculating about which price points will be most affected by the changes, while others about which areas of the country may see no affect at all.
What does that mean for the average buyer and seller? I think it depends on your personal situation and your needs. If you are considering a purchase for your personal home that you plan to live in for many years than month to month fluctuations aren't going to change that. It may make folks reevaluate how much they want to spend, but that should be something all homeowners carefully review anyway. Sellers need to keep an eye on the market and work with a realtor that will keep them up to date on events so they can adjust plans accordingly. Some areas of the city continue to see low inventory so an aggressive plan would be appropriate vs other sectors that require more finesse.
The interesting note to watch is the Calgary rental market. We are seeing low vacancy rates which have been trending down for some time, an increasing local population and now changes to lending rules. If more folks decide to rent and the resale market sees a dampening especially at the lower price points, it may be an opportunity for some investors with the ability to purchase to take advantage of the trends.
As always, selling or purchasing real estate is a big decision. Work with someone that has your best interests in mind.
Notable numbers from the latest CREB statistics update:
Single family monthly sales reached 1,609 units in June, a decline over the previous month, but 16 per cent higher than levels recorded in June 2011. However, new listings are declining as consumers appear to delay putting units on the market until they see further price recovery. Despite the decline, with a current inventory of 3,817, the supply constraint has eased and the single family market is moving towards more balanced levels.
The single-family benchmark price for the month of June 2012 was $430,800, a 7.3-per-cent increase over the previous year. Year-over-year price increases have been particularly strong in the recent months, in part due to the decline in months of supply. As the city moves towards balance, we can expect price growth to ease in following months.
“Homebuyers are confident about the long-term prospects in our city, and continue to search for homes in those communities that align with their needs,” Jablonski says. “People who are in the market to buy right now have to make their decisions quicker, but they are well informed and they continue to seek out value for their money.”
While June sales activity showed a modest improvement over last year, year-to-date condominium apartment sales totaled 1,858, a 7-per-cent increase over the first half of 2011. Both monthly and year-to-date sales remain consistent with long-term trends. The rise in sales over the first half of the year combined with a decline in listings helped reduce the excess supply. With supply hovering just above three months, the condominium apartment market remains in balance.
The condominium-apartment market recorded a modest improvement in pricing, with a benchmark price of $246,300 in June 2012, a year-over-year price gain of 1.5 per cent. The condominium-townhome benchmark price grew by 3.3 per cent over 2011, and is now $278,000.
“Recent reports have mentioned an overvalued Canadian housing market, and it is important to note that the Calgary market has already recorded a correction,” says Lurie, who notes benchmark prices in the entire CREB® residential market remain 8 per cent below peak levels. “Alberta was slow to recover from the recession, but this year our province is expected to lead the country in economic growth. This growth will continue to support gains in full-time employment and encourage positive momentum in our local housing market by way of both demand and price recovery,” Lurie concludes.