CALGARY — Calgary’s resale housing market in October is continuing to show very strong year-over-year sales growth with average prices competing with the peak level of 2007.
According to the Calgary Real Estate Board, month-to-date until October 30, total MLS transactions in the city of 1,603 are up 23.88 per cent from the same period a year ago and the average sale price has risen by 7.22 per cent to $435,922.
The October activity has pushed year-to-date sales to 18,616, an increase of 15.85 per cent. And the year-to-date average sale price has jumped to $427,612, up 2.99 per cent from a year ago. The yearly average sale price in the city peaked in 2007 at $423,770.
“The economy in Calgary has been growing and has outperformed many other regions in the country,” said Richard Cho, senior market analyst in Calgary for Canada Mortgage and Housing Corp. “Factors that support housing demand have improved in Calgary more quickly compared to other areas in Canada, contributing to some of the differences in resale activity. All of the jobs created in Calgary thus far in 2012 have been full-time jobs. Not only that, nearly all of the jobs created have been in the goods-producing sector, which on average are higher pay compared to the services-producing sector.
“Average earnings in Calgary have also increased, up over five per cent from 2011. The labour market in Calgary has provided opportunities for people to find good paying jobs which has helped support sales.”
Migration has been another factor contributing to the rise in sales as has continued relatively low interest rates, added Cho.
According to CREB, new listings so far in October have dipped to 2,231, down 8.64 per cent from the same period a year ago. And year-to-date listings of 29,253 are off 5.84 per cent from last year.
“We are seeing more pressure on prices this year,” said Cho. “Not only has demand picked up, but supply of existing homes has also come down. Elevated active listings in 2011 was one of the reasons that had tempered price growth. But since then, the market has become more balanced, there are fewer homes to choose from while demand remains steady. As such, we have seen prices gradually rise.”
Despite some warnings elsewhere in the country that the housing market is slowing down, Calgary’s market is buoyed by some positive economic fundamentals including economic growth, employment growth and population growth.
“The Calgary economy is expected to expand in 2013, but perhaps not to the same degree as in the previous year,” said Cho. “We anticipate the market to remain in balanced territory into 2013. The economy will continue to support many of the factors that support housing demand. Sales and prices are forecast to increase next year.”