Calgary Real Estate Predictions for 2008 – Who got it right? (Sneak Peek)

Seeing that we haven’t crossed over into December yet, this article might be a little premature.   However, I thought it would interesting to take a peek at predictions from this time last year.

Below are predictions on what would happen to Calgary average prices in 2008 (Source 1, Source 2):

RE/MAX:  0% growth
CMHC:  + 7.7%
REIN: + 12%
Royal Lepage: + 4% 

Back in December 2007, FindCalgary.com had the poll:  What will happen to Calgary home prices?  Here were the results of those that responded to the poll:

14% Price will stabilize
21% Rise Slowly
6% Skyrocket
34% Drop slowly
23% Plummet

What really has happened so far in 2008?

Average Prices

Year-to-date  (Jan 1 to Nov 26, 2008) the average SFH in metro-Calgary has cost $461,890.  In 2007, the average price during the same time period was $473,418.

Year-to-date, the average condo has cost $303,142.  In 2007, the average price during the same time period was $316,845.

Sales Volume

There have been 12,937 Single Family Home sales year to date.  Last year during the same period there were 17,396 sales.

Same story for condos – this year there have been 5,424 sales.  In 2007 during the same time period there were 7,754 sales. 

Inventory

There are currently 5378 SFH’s for sale, and 2544 condos.  That’s up from the 4984 and 2196 that was recorded from November 2007’s month-end.

Vacant/New Inventory is up too.   Today there are 1608 SFH’s and 955 condos compared to the 1237 SFH, 669 Condos in December 2007 (when I first started recording that stat)

I have anecdotal evidence to suggest that the inventory will be spiking in early Spring.  Many homeowners that have requested CMA’s from me, or had been trying to sell, have said they are going to “wait until the Spring until the market improves” to sell or relist.

Inventory Absorption Rate

Using the inventory and sales volume MTD, we are currently at a 9 month absorption rate for Single Family homes and over 10 months for condos.   That means if no more homes were listed and sales continued at the same pace, it would take 9 & 10 months respectively to clear the inventory.

If you know of any other earlier predictions, please post the news links in your comments.  Thanks!

4 responses to “Calgary Real Estate Predictions for 2008 – Who got it right? (Sneak Peek)

  1. lol @ 12%!!!! what were they thinking? seriously.

  2. Carioca Canuck

    Sing Louie from CMHC predicted an average SFH price of $550K in 2007 for Calgary……yes indeed….WTF were they thinking.

    You could have waited until Nov 30 too Mike…….the decline at that date was $26,329…..over two and times what you suggested as of Nov 26th.

    Mike says: “The figure I used was the Year-to-date average, not the month-to-date. In any case, yes, CMHC forecasts were off by a wide margin.

    A drop of 5.5%……..notice how none of the RE companies had the cojones to venture into negative territory.

    It is always a good time to buy. heh.

  3. Carioca Canuck

    Even more telling is the median drop of $22,000………

  4. CMHC Forecast Reports on Alberta House Prices for 2008

    2007, 3rd Qtr:” This, coupled with weaker demand, will ease some of the price pressure in 2008, resulting in a gain of less than 10 per cent”.

    2007, 4th Qtr:“Under these conditions, price growth will be limited to 7% in 2008.”

    2008, 1st Qtr: “In such an environment, resale price growth will slow to only four per cent in 2008″

    2008, 2nd Qtr: “In this environment, a 3.6 per cent gain in average price this year (2008) is forecast.”

    2008, 3rd Qtr: “After the unsustainable gains of the last two years, the average resale price will advance by only one per cent this year.”

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