CALGARY - Housing affordability improved in Alberta in the fourth quarter of last year amid slower economic recovery, compared with other regions across the country, according to the latest housing report released today by RBC Economics.
"The downturn in the housing market has created a large surplus of homes available for sale. This has held back the pace of price increases in the province since the market rebound took effect," said Robert Hogue, senior economist, RBC. "This subdued pace has kept Alberta's affordability in check."
The RBC Affordability measures for Alberta, which capture the proportion of pre-tax household income needed to service the costs of owning a home, declined across all housing types in the fourth quarter of 2009. The measure for the detached bungalow benchmark moved down to 33.7 per cent (a drop of 0.4 percentage points over the previous quarter), the standard townhouse to 25.8 per cent (down 0.4 percentage points), the standard condominium to 22.5 per cent (down 0.1 percentage point) and the standard two-story home to 37.9 per cent (down 0.2 percentage points).
The Calgary housing market continues to be attractive with affordability measures at or below long-term averages, said RBC. The strong rebound in resale activity slowed last summer and has reversed since the fall. However, the tight availability of homes for sale in Calgary has continued to provide a slight advantage to sellers, moving housing prices in a slight upward trend, said the report.
"With the exception of townhouses, price gains in the Calgary market have still been relatively modest and below the highs seen in 2007," added Hogue.