Monthly Archives: July 2010

New CREA Forecast (July 2010)

Posted on July 30, 2010 | 5 Comments

CREA has revised their forecast (last forecast was on June 2)  Most notable revision is for sales.

From today’s media release:

The decline is consistent with the exhaustion of pent-up demand from deferred purchases during the economic recession, and sales having been pulled forward into early 2010 due to changes in mortgage regulations.

Unfortunately those reasons weren’t factored into the calculations initially – as a record year was forecasted a few months ago.

February 8, 2010 commentary:

With Canadian economic growth rebounding from the recession, the unusually severe decline in sales activity in early 2009 is not expected to recur in 2010. Annual activity in 2010 is forecast to be well above the previous year’s level as a result. CREA forecasts national activity will reach 527,300 units in 2010, up 13.3 per cent from 2009. This would represent a new annual record, standing 1.2 per cent above the previous peak in 2007.

Between February and today, Canada-wide sales were revised downward 12.8% for 2010, and -13% for next year.

Here are the Alberta forecasts:

Forecast made on July 30, 2010
2010 average price: $349,600
2010 sales: 51,300
2011 average price: $348,500
2011 sales: 49,650

Forecast made on June 2, 2010
2010 average price: $348,400
2010 sales: 55,900
2011 average price: $350,800
2011 Alberta sales: 55,400

Forecast made on Feb 8, 2010
2010 average price: $357,300
2010 sales: 63,050
2011 average price: $361,700
2011 sales: 64,000

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Posted in Calgary Real Estate Discussion

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Calgary Historical Average House Prices & Sales Timeline

Posted on July 29, 2010 | 4 Comments

Update, April 2012: click here

A look at Calgary house prices & sales over the past few decades.

During the early 1980′s boom/bust, Calgary average house prices peaked at $110,184 (Total MLS) in January 1982.  Prices bottomed out in November 1984 at $68,322 – at 37.99% drop.

The next peak was in July 2007 at $442,693 (remember, that’s using old criteria) with the next low in January 2009 at $363,706 – a 17.8% decline.   Last month, the average price was $417,875 which is down 5.6% from the peak.

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It’s interesting to see how prices reacted to changes in the mortgage rules:

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Since 1987, the highest sales level was in March 2007 with 3939 transactions. The lowest was 683 in December 1995 (December 2008 had 767). When looking at just the month of June, residential sales last month were the lowest since 1996 with 1811 properties changing hands.

For detailed historical statistics including average and median prices, please visit my website at:

FindCalgary.com

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Note: Up until May 2007, the residential statistics compiled by CREB included “single family homes, condos, and mobile homes in the city of Calgary and surrounding district. Please be aware that these numbers do not include ”Total MLS” which includes Country Residential and Rural Land. Country Residential and Rural Land listings were never included in the “Old Criteria” statistics, and they are not included here.”

Bob Truman is the only Calgary agent I know that still keeps track of the CREB’s old criteria, which is essential for comparing “apples to apples.”  Thanks!

In 2007, the statistics were divided into SFH and Condos for Metro-Calgary which I think is a much better way to track prices.   But for the purpose of this post, the statistics used in the charts below are CREB’s “old criteria” unless otherwise specified.  (I only have statistics going back to 2002 using the new criteria)

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Posted in Calgary Real Estate Discussion

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House Price Index (HPI): May 2010

Posted on July 28, 2010 | 1 Comment

While sales levels were dropping, prices were still on the rise in May according to the Teranet-National Bank House Index. Canadian home prices in May were up 13.6% from a year earlier.

Teranet – National Bank National Composite House Price Index™

The 12-month gain was most  influenced by:

  • Vancouver (+17.1%)
  • Toronto  (+16.0%)
  • Ottawa (+11.4%)
  • Montreal (+8.5%)
  • Halifax (+5.6%)

May was the second consecutive month in which prices were up from the month before in all 6 metropolitan areas surveyed.  The monthly rise of the composite index, 1.3%, was the largest since last September.

The month-over-month rise was:

  • Ottawa  (+2.3%)
  • Montreal (+1.8%)  -the largest gain in this market since June 2007
  • Vancouver (+1.2%)
  • Toronto (+1.1%)
  • Halifax (+0.7%)

Calgary Prices

In Calgary, prices were up 7.8% from the previous year, and up 1.2% from the previous month.

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The Teranet report included the following commentary:

Since market conditions have been loosening across Canada – from April to June of this year, the number of existing homes sold declined much faster than the number of new listings – it is too early to conclude that the relatively vigorous prices rises of April and May mark the beginning of a trend.

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Posted in Calgary Real Estate Discussion

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Does Real Estate Slump During the Summer Months?

Posted on July 25, 2010 | 5 Comments

Do Calgary Sales Slump During the Summer Months?

Generally speaking, yes.  Sales usually peak in the spring months before declining throughout the remainder of the year. In 6 out of the last 9 years, sales peaked in March or April.   (In 2003 it was in May, 2008/2009 in June)

Obviously sales are still exceptionally low for this time of year, but a slowing down during the summer months is in line with past years.

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Average Prices

In 2002-2005, average prices reached their highs in the months of November & December.   In 2006-2008, prices peaked during May, June & July.    So when it comes to the summer months, it’s a mixed bag as to how prices react.

Here’s the breakdown during the past 8 years (not including this year)

5/8: average prices increased between the months of May & June
6/8: average prices decreased between the months of June & July
4/8: average prices increased between the months of July & August

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Sell Early, Breathe Easier

When needing to sell, it’s best to list early in the year to take advantage of the lower inventory and highest amount of buyers.  I know of several homeowners that are taking possession of their new home in late August but there has been absolutely no activity on their current home for sale.

While selling early and renting for a few months may seem inconvenient, it’s the safest course of action when market conditions aren’t back on sure footing.   Another alternative is to list early and negotiate the possession date as far back as possible (make sure you have a healthy deposit from the buyer when doing this)  or some buyers might even consider renting back the same house to you for a few months thereby avoiding having to move twice. (I would prefer this last option since I know the sale has closed and the money is safely in my pocket)

In January I listed a home in Evanston and within one week it was C/S with the sale firming up a week after that.   For whatever reason, the new homeowners listed the house for sale again in May and for the same asking price.  Almost two months later and it still hasn’t sold.

If my clients had waited to list, they would be in quite an unenviable position right now.

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Posted in Calgary Real Estate Discussion

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Inventory Update (July 2010)

Posted on July 21, 2010 | 8 Comments

SFH inventory has peaked

After eclipsing the 6300 mark in late June, SFH inventory began its descent.   The pace of new listings has slowed from earlier in the year and expiring listings are a main contributing factor for the falling inventory.  You can see that most listings expire at the end of the month with a smaller spike mid-month.

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Zooming out to a year-over-year view we can see that as high as inventory climbed this year, it didn’t reach the highs of 2008.  Sales are lower than this time in 2008 so we might end up seeing inventory set new month-end highs a little later in the year.

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Posted in Calgary Real Estate Discussion

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