Will Calgary Once Again Be Canada’s Real Estate Hot Spot?

While Toronto and Vancouver have been the focus of the Canadian housing market, Robert Kavcic, an economist with BMO writes that Calgary is quietly becoming a market to watch. In a brief research note released today on April’s housing figures, he wrote:

[Calgary] Sales jumped 30% y/y in April and are back above the 10-year average for the first time in about 3 years.

Prices have yet to gain much momentum (up 0.7% y/y), but supply conditions are tightening rapidly across Alberta.

The months’ supply was down to 4.6 from a post-recession high of more than 8, and sales have far outpaced new listings in recent months.

If oil prices remain high enough to continue supporting strong economic growth and migration flows, Calgary could again become Canada’s real estate hot spot in short order.

You can read the release here

TD Economics didn’t have any specific remarks regarding Calgary, but reiterated their stance that “Canadian housing is 10-15% overvalued, with the excess most evident in Toronto and Vancouver.”   They also aren’t surprised with the increasing sales:

With mortgage rates still at rock bottom through the early part of this year and job creation heating up through March and April, it’s not that surprising to see continued growth in Canadian home sales.

Absent of an external negative economic shock, Canadian housing demand should remain supported by a continued low interest rate environment through 2012 – albeit longer term mortgage rates did start to creep up (but still remain historically low) in April of this year.

You can read the entire release here

With Calgary seeing monthly resales gains of 6.1% and the “third consecutive outsized increase,” RBC says it’s a “clear indication that this market is finally taking flight.”

You can read the entire release here

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