Airdrie Real Estate Market Report: June 2015

Airdrie June 2015 statistics

Airdrie June 2015 statistics

Airdrie home sales improved in June but a greater number of new listings nudged inventory to its highest level since 2011.

The 166 homes sold last month was a 8.5% increase from May but a -16% drop year-over-year.  New listings pulled back from last June by -4% to 243.  Inventory climbed to 384 by month’s end, the most selection buyers have had since May 2011.

Airdrie’s red-hot seller’s market from last year had ping-ponged to a buyer’s market in January and then into a balanced one by June with 2.31 months of supply and a sales-to-new-listing ratio of 0.68.

Benchmark price annual growth slowed to 2.9%, the smallest increase since November 2012 and a far cry from the double digit gains experienced through most of 2014.  (Benchmark price growth was 10% or more in 8/12 months in 2014, the lowest was 8.4%)

You can download the City of Airdrie historical stat package along with additional charts here

Chestermere Home Sales Set Record In June

chestermere

The City of Chestermere bucked the regional trend by setting an all-time sales record in June.

A total of 64 homes sold during the month, a 49% year-over-year increase and more than the entire Q1 2015.

For the city overall, prices were up from a year ago by all three measures:  the benchmark price increased 7.4% from $458,900 to $493,000; average price was up 2.5% from $532,071 to $545,509; median price posted a 1.5% gain, climbing from $512,500 to$520,000.

Despite the benchmark price posting a hefty gain, it remains some $60,700 off the 2010 peak.

There were 125 homes on the market at the end of the month, only 6 more than last June and 20 fewer than the previous month. The Chestermere market enters the summer on solid footing:  under two months of supply and a sales-to-new-listing ratio of 0.86.

You can download the City of Chestermere stat package along with additional charts here pdf

Chestermere home sales

Chestermere home sales

Chestermere Inventory

Chestermere Inventory

June 2015 Calgary Real Estate Market Report

creb

Download CREB®’s June 2015 Report: click here pdf

CREB® commentary:  Despite the 18 per cent year-over-year decline in June home sales, for a total of 2,183 units, transaction levels remain only five per cent below the 10 year average for June and three per cent above levels over the past five years.

“We’ve seen less concern from consumers lately,” said CREB® president Corinne Lyall. “One of the main reasons is that we haven’t seen the worst case scenarios play out in the energy and housing sectors.”

“Consumers who were waiting for wide-spread price declines have been surprised to see that it just hasn’t happened yet, and so they’ve decided to take advantage of the improved selection and lower lending rates,” said Lyall.

“The level of new listings that came on the market in June totaled 3,122 units, resulting in the second month of elevated absorption rates, which placed downward pressure on inventory levels. The overall months of supply continues to remain balanced at 2.3 months.

With conditions remaining relatively stable in June, there was minimal pressure on home prices. The citywide benchmark price totaled $455,400, a respective monthly and year-over-year gain of 0.29 and 0.13 per cent.

“Even though city-wide prices were essentially unchanged in June, it’s important to note that activity can vary significantly depending on community, property type and price range,” said Lyall. “Every transaction has its own unique features, which is why we always encourage consumers to discuss these differences with local experts.”

Second quarter results pointed towards more stability in the market. The year-over-year decline in sales activity eased from 32 per cent in the first quarter to 22 per cent in the second quarter. Meanwhile, the level of pullback of new listings outweighed the gains recorded in the first quarter, resulting in a yearto-date decline of nearly eight per cent.

While both sales and new listings have slowed for each property type within the city, the apartment sector continues to report the weakest absorption rates.

The weaker rates in this sector are now impacting prices. Despite last month’s improvement in price, the second quarter benchmark price was 0.81 per cent below levels recorded last year and 0.93 per cent below first quarter figures. Year-to-date unadjusted apartment averages continue to remain 1.65 per cent above last year’s levels.

In the detached segment, benchmark prices totaled $515,500 in June, slightly higher than last month and 0.4 per cent higher than June 2014 prices. Meanwhile, the year-to-date benchmark price for detached properties remained 3.44 per cent above last year’s figures.

Against this backdrop, the year-todate average and median detached home price for Calgary has reported declines of 2.26 and 1.54 per cent city-wide. This doesn’t come as a surprise, given that the share of sales activity has declined in the higher price ranges.

“The housing market is showing some signs of stability right now,” said CREB® chief economist AnnMarie Lurie. “However, there are several risk factors that could influence the market in the second half of the year,” said Lurie. “Many of these factors will be addressed in CREB®’s mid-year forecast update, which will be released at the end of July.”

Calgary Luxury Home Sales Climb To Second Highest June Level

Calgary’s luxury home market had a strong start to the summer selling season but lagged far behind the record-setting pace from last year.

A total of 75 homes sold for $1 million or more during the month making it the second highest June tally ever.   Compared to last June, a record-breaking month, sales were off by nearly -29% and year-to-date sales were down -36% from the first half of 2014.

Two units at The River sold for $3,769,500 which were the most expensive sales for the month.  The most active community was Elbow Park/Glencoe with 7 sales, followed by Springbank Hill and West Springs with 6 sales each.

Through 6 months the highest demand was in Altadore/River Park with 25 sales.  Next up was Elbow Park with 19 sales and  then Aspen Woods with 18.  (Luxury sales by community pdf)

It isn’t unusual to see large price reductions in the luxury market.  Pricing some of these homes is more of an art than a science if there aren’t recent sales comps.   However, we can glean some insight into how specific homes are performing by comparing sale prices of those that have sold at least twice.

Of the 75 high-end sales in June, a third of them had previously sold on MLS® within the past 10 years.   And of those 25 repeat sales, 4 of them sold for less than they were purchased (Luxury repeat sale prices pdf )

Inventory figures will be added when CREB® releases the June stats on July 2nd.

Calgary luxury home sales - June 2015

Calgary luxury home sales, June, Y/Y comparison

2015 YTD June - Calgary luxury home sales

2015 YTD June – Calgary luxury home sales

June 1-21, 2015 Calgary Real Estate Market Update

“The worst may be over” for the Alberta housing market states RBC Economics in their Housing Trends and Affordability report out today.   The release continues in part:

“Housing markets in Alberta experienced a particularly violent bout of anxiety in the face of plummeting oil prices at the start of 2015.   Sellers rushed to list their homes, and buyers hit the pause button; the combination of which dramatically loosened demand-supply conditions that turned the table squarely in favour in buyers.”

Following a period of rapid price increases in 2013 and most of 2014, property values came under downward pressure in the first quarter of 2015… Resale activity stabilized recently, thereby suggesting that the worst may be over for the market.”  (Source)

For Calgary specifically, it meant that housing affordability improved  in the first quarter for two-storey homes, bungalows and condo apartments.   Still…

“Housing affordability may not be top of the mind for homebuyers at this juncture—uncertainty about global oil markets and, above all, Alberta’s economy likely are dominant considerations. More recent developments show that the freefall in resale activity has stabilized this spring.”

This stabilization has also been evident thus far in June with sales only off the 5 & 10 year average by about 50; a marked improvement from earlier this year when every sales statistic was followed by: “the lowest level since…”

Further helping brace Calgary’s market is the pullback in new listings.  Month-to-date, new listings are below the 10 year average by -13% and the 5 year average by -6.6%.

Compared to last June, there have been 368 fewer sales (-19.2%) but 657 fewer new listings (-22.5)   The sales-t0-new-listings ratio is at a very active 68.55%, a few percentage points higher than last year during that time.

That’s not to say buyers are feeling rushed or forced into multiple offer situations like last summer.   Consider this:  only 198/1,550 (12.8%) of homes have sold for list price or above this month, less than half the amount during the first 3 weeks last June: 479/1918 (25%).

Inventory, which had been up significantly on an annual basis earlier this year, has seen the gap shrink.   There are 5,370 active listings today compared to about 4,945 a year ago, a 9% y/y increase.   Back on January 21st, inventory was up a staggering 67%.

Both the average and median price are showing slight annual declines, down -2.94% and -1.66% respectively with the largest declines in the Apartment segment so far this month.

Calgary home sales June 21 2015

Calgary home sales, June 1-21, Y/Y comparison

Calgary new listings June 21 2015

Calgary new listings, June 1-21, Y/Y comparison

Sales-to-new-listings ratio June 21 2015

Sales-to-new-listings ratio: June 1-21, 2015

Calgary luxury home sales June 21 2015

Calgary luxury home sales, June, Y/Y comparison

Calgary Stats Summary June 1-21 2015

Calgary Stats Summary, June 1-21, Y/Y comparison

RBC: Calgary Housing Market “Healing Process Has Begun”

The Canadian Real Estate Association (CREA) released the May figures yesterday which was followed by commentary from bank economists.

Below is a round-up of excerpts regarding the Calgary market:

RBC Economics:

Perhaps even more encouraging were developments in Alberta and Saskatchewan where confidence appears to be returning.

Successive monthly gains in resales, significant reductions in the number of new listings and, as of May, evidence that prices are picking up again in Calgary lead us to believe that the healing process has begun in those markets.

Thus, the good news is that conditions are improving among Canada’s softer markets.

Read full report pdf

TD Economics:

Price gains in Calgary continued to slow, with the MLS HPI up only 1.2% y/y, although prices did rise slightly in May.

Looking ahead, given the increase in government bond yields recently – which influence mortgage rates – mortgage rates could move higher later this year, dampening demand in Canada’s housing market.

Overall, though, we expect the regional divide to continue. While sales in oil-related markets of Edmonton and Calgary have risen off their January lows, price gains remain modest.

Read full report pdf

BMO Economics:

“The prairies continue to face the toughest conditions in the wake of lower oil prices. Calgary, Edmonton, Saskatoon and Regina are all seeing sales down in the 10%-to-28% range versus a year ago, though they have also shown signs of turning around (or at least stabilizing) in the latest two months.

In Calgary, a deep dive in new listings has helped rebalance the market and stem the price decline (the
seasonally-adjusted HPI is now down a modest 3% from its 2014 high).

Read full report pdf

Scotia Economics:

Energy-sector cutbacks and reduced population inflows have cooled housing demand in Alberta and Saskatchewan, especially for high-end homes.

At the same time, sales and listings appear to be stabilizing through the spring, as buyers take advantage of greater selection and a more competitive pricing environment.

Red full report pdf

June 1-14, 2015 Calgary Real Estate Market Update

Calgary home sales have found some traction with a total of 1,032 homes selling through two weeks.  While that’s still -18% off last June’s near-record pace, it’s not far behind the 5 & 10 year average for the month (1,080/1,082).

Attached home sales (213) are even slightly above the historical averages month-to-date.

Calgary home sales June 1-14 2015

Calgary home sales June 1-14 2015

Sales-to-new-listings-ratio June 14 2015

Sales-to-new-listings-ratio June 14 dfdfd[/=2015

The 1,552 new listings are the fewest to come online for the month since 2005. Despite the current sales-to-new-listings ratio being at healthy 66% overall, until we see a significant reduction in the inventory that had accumulated earlier this year, we’ll continue to see negative price pressure.  Recall that the City of Calgary benchmark price in May was up an anemic 0.95% year-over-year.

Calgary new listings June 15 2015

Calgary new listings June 15 2015

Luxury home sales are having a dramatic effect on the Apartment segment’s average price, and no, condos are not in a “full-blown meltdown” as one anonymous poster wrote.

Just like the Apartment average price was boosted ~$20,000 last month by several large sales, the reverse is happening now.

Only one unit has sold for $1M+ MTD compared to five last June, a couple of which were for over $3 million.   Without those five sales, the average price would drop to $312,802 from $352,018. Removing the one luxury sale from this June would mean an average price of $292,933 instead of $297,745.

Examining the 175 apartment sales will show that 46 of them (26.3%) previously sold on MLS® since 2010.   Only four of them sold for less than they were previously purchased, but others had sparse appreciation that would’ve been wiped out after fees.  Still, many saw significant growth.

Condo sales between June 1-14

Condo sales between June 1-14

The point being is that when you read reports about a record monthly drop in Calgary prices – that’s the overall market painted with the same brush.   Different property types, price points and communities can and do trend much differently.

Not to be ignored is how new construction influences the resale market.  Take for example new condo sales.  In Q1,  sales were 53% lower than the average of the past five years, creating “substantial” downward price pressure. (Read Altus Group Q1 Update)

In a slow market, developers prefer to offer incentives rather than reduce prices.   But at least one condo developer has opted to go the price-cutting route:

Condo Clearout

Sign of the times?

With vacancy rates on the rise and many more units under construction, it will be interesting to read the Altus Q2 report and assess the subsequent impact on the resale market.

Calgary luxury home sales June 14 2015

Calgary luxury home sales, June 1-14, Y/Y comparison

Calgary Stats Summary June 1-14 2015

Calgary Stats Summary June 1-14 2015