Monthly Archives: May 2011

CMHC: Calgary Prices & Sales to Increase in 2011

Posted on May 30, 2011 | 6 Comments

According to CMHC’s Housing Market Outlook – 2 QTR released today, Calgary sales are forecast to increase 4.8% in 2011.  Prices are also expected nudge upwards by a little over 1%.

Here are some of the excerpts from the report regarding Alberta:

Economic growth in Alberta is projected to outperform the national average this year and next, thanks largely to elevated oil prices. Drilling activity has been higher this year and is expected to improve over the forecast period, as a result of rising sales of provincial crown petroleum and natural gas rights. While activity in the oil sands will benefit from a low natural gas price, the natural gas industry itself will be hampered by elevated inventories and low pricing. On the trade front, higher energy exports will also help Alberta’s economy expand this year and next.

Resales: Resales across the province’s major markets have generally showed improvement in 2010. Going forward, housing markets across Alberta will benefit from employment growth and new household formation. Almost all of Alberta’s major centres are projected to experience a higher level of resales this year.

Read the entire report here

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How does this forecast compare to the one exactly a year ago?  Below is the most recent forecast:

2011 2QTR Forecast (click to enlarge)

And here is the forecast from exactly one year ago (2nd QTR 2010):

CMHC 2QTR - 2010 (click to enlarge)

Let’s take a look at the 2010 forecast and final numbers first.

MLS® Sales
2010 Forecast:  25,000
Actual:  20,996
Difference:  -16%

MLS® Average Price
2010 Forecast:  $403,000
Actual: $398,764
Difference: -1%

The price forecast quite accurate, however the sales forecast was off significantly.

Now let’s see how the forecast for 2011 has changed over the past year:

2011 MLS® Sales Forecast
2010 Report: 26,000
2011 Report:  22,000
Difference: -15%

2011 MLS® Price Forecast
2010 Report: $418,000
2011 Report:  $403,000
Difference: -3.5%

Looking at Sales, Prices, Single-detached housing starts and NHPI you can see that they start with aggressive forecasts and then revise them closer to reality as the forecast year approaches completion.  The one exception I found in the 2 reports was in 2010 they underestimated the total of multi-family starts.

Here are the other CMHC Housing Market Outlook reports available:

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Condo Market Coming Out Of Recession?

Posted on May 29, 2011 | 5 Comments

I’m sure glad new condominiums such as Cardel’s projects are apparently showing signs that the Calgary multi-family is coming out of the recession.  Which probably explains why the resale market continues to struggle – new condos are siphoning off all the buyers…

Metro-Calgary condo sales last week dropped to their lowest point since January.  Blame it on nice weather, poor weather, the long weekend, the Stanley Cup finals, or Cardel – whatever you want.

Condo Weekly Sales (click to enlarge)

Fact is, month-to-date condo sales are down almost -7% and year-to-date are down -11.5%.   (Remember, CREB forecast a 15.8% increase this year.  They have 7 months to hope for a 180)

Pending Sales (click to enlarge)

If enough of the slightly elevated pending sales don’t firm up on Monday & Tuesday, it will mean condo sales were down year-over-year for the 13th straight month. Not exactly an argument for a strengthening condo market.

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Single Family Homes

The single family segment is showing more positive signs. Pending sales hit their highest point this week and are tracking above last year’s levels.

SFH Pending (click to enlarge)

However, upon looking at last week’s sales, the increase in pendings seems more to do with a backlog of transactions not firming up rather than increased buyer momentum.

SFH Weekly Sales (click to enlarge)

Whereas in 2009 the May long weekend marked the start of a busy summer, this year seems to be following closer to 2010′s muted pace.

So far this month, sales are up 1.1% MTD (1191 sales VS 1184 in May 1-28, 2010)

Year-to-date, SFH sales are showing an impressive 0.03% increase over last year and closing in on the 19.9% increase forecast by CREB for 2011.

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Inventory and new listings are much lower than this time last year — check back on Wednesday for the month-end May report.

Be sure to follow the daily statistics on my webpage at:

FindCalgary.com

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MoneySense Ranks Canada’s Top Markets

Posted on May 26, 2011 | Leave a comment

MoneySense’s newest issue “Guide to Buying and Selling Your Home” ranks Canada’s top 35 markets.

Here’s how they were ranked according to MoneySense:

To start, we collect detailed statistics and assign letter grades to 35 cities across Canada tracked by Canada Mortgage and Housing Corporation (CMHC). Our aim is to find those cities with limited downside risk — where real estate is still cheap, while income levels and job prospects are high and rising higher. That means all of our top cities combine affordability and strong local economies.

To arrive at the top cities, we identify markets with homes that are priced reasonably (our “value” score), but still increasing in price (our “momentum” score). We also look for strong local economies (our “economy” score). We assign a letter grade for each category and then combine all three to get an overall grade. (Note that the categories are not evenly weighted. So a city that earns an A, a B and a C for value, momentum and economy will not necessarily get a B overall.)

Only a select group of cities—those that managed to achieve at least a B+ in the overall grade (and didn’t score lower than a B- in any one of the three subcategories) — ended up on our list of finalists. That’s a tall order to fill, and only nine cities made the grade.

Unfortunately, Calgary wasn’t one of those 9 cities but overall scored a B-minus. Here’s the breakdown:

Value: C+
Momentum: C-
Economy: A

To read the MoneySense article, click here

To view the Table of Contents of the issue, click here (PDF)

To order the issue, click here

Source: MoneySense (click to enlarge)

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House Price Index (HPI): March 2011

Posted on May 25, 2011 | 1 Comment

Canadian home prices in March were up 0.6% from the previous month, according to the Teranet-National Bank National Composite House Price Index™. It was the fourth consecutive monthly rise, after three consecutive monthly declines. In March, prices rose in five of the six metropolitan markets surveyed.

Calgary was the only market surveyed that showed a decrease. Calgary prices were down 0.1% from the previous month and down 3.3% from a year earlier, for a sixth consecutive month of 12-month deflation.

(click to enlarge)


(click to enlarge)

The Teranet–National Bank House Price Index™ is estimated by tracking observed or registered home prices over time using data collected from public land registries. All dwellings that have been sold at least twice are considered in the calculation of the index. This is known as the repeat sales method; a complete description of the method is given at www.housepriceindex.ca

All indices have a base value of 100 in June 2005. For example, an index value of 130 means that home prices have increased 30% since June 2005.

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May 1 – 21, 2011 Calgary Real Estate Market Update

Posted on May 22, 2011 | 9 Comments

I hope everyone is enjoying their long weekend! Here’s the market update for May 1-21, 2011:

May single family home (SFH) sales are poised to surpass last year’s levels by the end of the month.  Month-to-date, 941 homes have sold compared to 945 during the first three weeks last year.  Pending sales have been higher than 2010′s levels by an average of 60 homes this past week and you can see the results of this in the weekly sales chart.

Sales (click to enlarge)

SFH Pending (click to enlarge)

SFH Weekly Sales (click to enlarge)

Despite the low sales, because of the reduced inventory the current absorption rate is at 3.6 months which is still classified as “balanced” conditions with generally neither Sellers nor Buyers having the upper hand in negotiations.

Metr0-Calgary Condos

A total of 360 units changed hands between May 1-21, a slight decline from the 385 sales recorded last May during the same time period.

Condo Pending Sales (click to enlarge)

For the ninth straight week, condo sales have averaged between 115-125 sales:

Condo Weekly Sales (click to enlarge)

Metro-Calgary condo inventory absorption rate is currently at 4.25 which means that market conditions slightly favors buyers over sellers at this point in time.

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Your Input Wanted

This week a few Calgary Realtors (myself included) will be meeting with our new senior economist at CREB. To be discussed is what type of housing information and statistics we would like to see in order to help support us in our business.

While Bob & I provide many statistics not commonly found anywhere else, is there any other information you personally would find helpful to make a better assessment of our housing market?

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