CALGARY — Calgary’s resale housing market had the highest annual rate of sales growth in the country in October, according to the Canadian Real Estate Association.
In releasing its monthly MLS data on Thursday, the association said sales in Calgary rose by 26.7 per cent to 2,104 transactions.
Nationally, sales dipped by 0.8 per cent to 35,971.
Robert Kavcic, economist with BMO Capital Markets, said “strong population and income growth are supporting demand” in Calgary.
“This has helped draw down the excess supply built up during the prior boom — the market is now close to full-scale sellers’ territory,” he said.
The average sale price in Calgary also outpaced the national average. Prices in the city rose by 5.0 per cent from a year ago to $418,721 while the price remained stable across the country at $361,516.
“Sales data in October held steady at the national level, but we are seeing some diverging trends among local housing markets,” said Wayne Moen, president of CREA. “Markets in Alberta and Saskatchewan are gaining strength, while some of Canada’s traditionally most active markets have lost steam.”
Gregory Klump, chief economist at CREA, said national sales in October were on par with the same month last year and in line with the 10-year average for the month.
“These results suggest that the Canadian housing market overall has returned to a more sustainable pace,” he said.
In Alberta, sales of 4,815 in October were up 17.5 per cent from last year while the average sale price rose by 3.5 per cent to $363,295.
CREA also reported Thursday that its MLS Home Price Index, which follows a benchmark price, increased by 3.6 per cent from last year across the country in seven major markets, the sixth consecutive month in which the price gain slowed and is the slowest rate of increase since May 2011.
Regina recorded the highest increase at 12.98 per cent followed by Calgary at 6.76 per cent.
According to the Calgary Real Estate Board, so far this month up until Wednesday, total MLS sales in the city of 619 have increased by 0.98 per cent compared with the same period a year ago and the average sale price has risen by 2.63 per cent to $430,594.
Sonya Gulati, senior economist with TD Economics, said housing market trends in Canada for 2012 can be characterized as before and after regulatory changes.
“In the first half of the year, sales and price gains were modest, but positive. More stringent mortgage rules and tighter mortgage underwriting rules have purposely knocked the wind out of the housing market sails,” she said.
“While regulation is having the intended impact on the housing market, it typically has only temporary staying power. The cool down we are currently experiencing should be lifted in early 2013. What happens thereafter is less certain. The low interest rate environment could pull homeowners back onto the market, causing home prices to once again trek upwards. Alternatively, an absence of pent-up demand may leave the market in a bit of a lull until interest rate hikes resume in late 2013. Under either scenario, it is safe to say that there is a low probability of out-sized home price gains over the near-term.”