Monthly Archives: May 2012

House Price Index (HPI): April 2012

(Note: Beginning with this report, Teranet will be releasing the index one month earlier. It will now appear within one month of the end of the period covered. Thus this release dated May reports index results for April rather than for March)

Calgary home prices continued to increase throughout the spring months according to the Teranet–National Bank National Composite House Price Index™ released today.

Between March and April, the index for Calgary rose 1.4%. Calgary’s month-over-month gains were bested only by Halifax (1.6%) and Edmonton (1.5%).

Year-over-year, prices in Calgary were up 1.9%. Markets were described as “on the tight side” in Toronto, Hamilton, Winnipeg & more recently Halifax, Calgary and Edmonton.

HPI: April 2012

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

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

May 1-28, 2012 Calgary Real Estate Update

The long-awaited resurgence of the Calgary-housing market appears to have
been launched in recent months,” writes RBC in their latest Housing Trends and Affordability report released today.  “Homebuyers in the Calgary area are motivated by a booming provincial economy, strong job creation, and attractive housing affordability…We expect the market resurgence to continue for the remainder of this year.

While the report covers Q1 activity with a mention of April sales, this resurgence has obviously carried into the current month.

Through four weeks of May, Calgary home sales are up 26.52% over last year with 1503.

Calgary SFH Sales

Prices in April were up a paltry 0.77% year-over-year, but it looks like it’s getting some traction this month.  The average price is currently up 3.12% to $503,694  and on track to set a record for the month of May –  falling just short of the all-time record set in summer of 2007.  The median is up 3.57% y/y to $435,000.

Single Family Home Prices

The upper-end market continues to perform strongly with 67 single family homes selling for a million dollars or more, far above previous levels seen in May.

Million Dollar+ Sales


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For more information and statistics including condominium average and median prices, please visit:

FindCalgary

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Questions? Ready to buy or sell real estate? I can be contacted at mike@findcalgary.com or 403-554-2284

Mortgages in Arrears Declining In Canada

(Note: The arrears figures for 2011 and some of 2010 have now been revised with the latest report released today)

In Canada, the arrears rate was 0.37% in March with 16,043 residential mortgages in arrears by 3 or more months.  That’s down from the 17,974 recorded in March 2011 that made up 0.43% of the total number of mortgages.

At 0.37%, it’s at the lowest percentage since January 2009.

Canada – Mortgages in Arrears

In Alberta, there were 3,609 mortgages in arrears in March representing 0.69% of the total residential mortgages.   Compare that to 4,150 (0.82%) from March 2011.  At 0.69%, it brings us back to October 2009’s level.

Between February and March, Alberta and BC were the only 2 provinces to record a month-over-month increase in the percentage of arrears to total mortgages.

Alberta Mortgages in Arrears

The CBA includes data from BMO, CIBC, HSBC Bank Canada, National Bank of Canada, RBC Royal Bank, Scotiabank, and TD Canada Trust. Canadian Western Bank, Manulife Bank (as of April 2004) and Laurentian Bank (as of October 2010)

You can view the source data for all of the provinces here

Analyst Insight On Calgary Real Estate

Ben Rabidoux, an analyst and strategist with M Hanson Advisors and author of the TheEconomicAnalyst.com, recently took a look at real estate in Canada`s largest cities.

Below is his take on Calgary`s market:

Calgary underwent a market correction staring in 2007. Resale prices have nearly returned to their previous highs but the fundamentals remain stretched. I often liken Calgary real estate to a high price-to-earnings growth stock where future earnings potential is being reflected in current prices.

In Calgary, it’s clear that prices reflect the popular belief that the province will continue to experience strong economic growth. If this happens, it’s possible that prices will continue to move sideways – or slowly rise – while fundamentals catch up. But if the expected economic growth fails to materialize, there would be quite a bit of dead air between prices and underlying fundamentals.

In terms of supply and demand, the city looks pretty strong with sales rebounding off their lows but still well below the highs of the boom years. Inventory levels also remain healthy suggesting that over the short term, there is strong support for resale prices in the city. In April, resale prices rose a paltry 0.8 per cent on a year-over-year basis but this pace could quicken slightly in the coming months.

For the full article in the Globe & Mail which he provides insight on other cities including Vancouver, Toronto, Ottawa, and Montreal, please click here

Greek Contagion

The events unfolding in a small nation halfway around the globe will have far reaching effects that will impact the financial & economic markets.  While Canada’s direct trade exposure to Europe is only 10%,  TD examined what a potential Greek exit from the euro would mean on our economy.

On Canada’s housing market specifically, TD writes:

While corporate balance sheets remain strong, household  debt has become excessive and the housing market is in our view 10-15% overvalued, leaving households more vulnerable to a negative economic event.

A global financial crisis could be a major catalyst for a sharp housing market correction and household deleveraging – albeit to a lesser extent than was evident in the U.S. during the past recession.

Moreover, Canadian governments would have less room to stimulate compared to the first crisis in 2008-2009. While Canada’s economy would probably still fare better than most in the eurozone under this scenario, it would likely underperform that of the United States.

In a worse case scenario, the Canadian economy would likely endure a severe recession, with the decline being substantially worse than that experienced during the recent recession as both exports and domestic spending contract heavily.

TD has written several reports on what a possible Greek exit from the euro would have. Click below to read each report: