Calgary VS Toronto VS Vancouver

Since we don’t have any NHL standings to compare, I thought we could take a look at the October housing statistics the boards have released for Calgary, Vancouver, and Toronto.

Below is the summary from Scotia Economics Daily Points (November 6, 2012)

Vancouver sales were 16.7% lower in October 2012 compared to October of last year, and 28.5% below the 10 year average for the month of October. They rose 27.4% in m/m terms, but this figure is not seasonally adjusted by the Vancouver RealEstate Board and September is usually a slower month for home sales with the kids back to school. I think the more important information here is therefore that October sales were exceptionally weak compared to past Octobers.

Toronto’s resales were down 7.1% in October over October 2011 and the Toronto Real Estate Board pointed out that after adjusted for two extra business days compared to last October, sales were really down by 15.6% y/y. That’s a hint that the seasonal adjustment factor for October will have to take account of the extra business days by subtracting from the unadjusted figure. Within the City of Toronto, sales are 10% lower than a year ago. In the rest of the Greater Toronto Area, sales are 5% lower, and the whole GTA is down 7%. New listings in the GTA are up 6.1% so weaker sales are combining with more listings. By type of housing for the whole GTA, sales of condos are down the most (-16% y/y) and note that resales are not taking it anywhere nearly as hard as new condo sales, with 3-7% y/y drops being recorded in detached, semidetached, and townhomes.

Calgary’s resale market remains strong. October sales were 23% higher than in October 2011. The local real estate board posits that Calgary is in a goldilocks state, outperforming virtually every other region of the country while it says conditions are not over-heating again. New listings fell 8.6% y/y, and prices are up 8% y/y for a single family home. Calgary’s year to date sales figures are tracking at their highest since 2007 before the wheels fell off.

Undoubtedly, Calgary is performing better than Toronto and Vancouver…much like its hockey team counterpart.  😛

It shouldn’t come as a surprise then that according to the Emerging Trends in Real Estate® 2013  survey report released today by PwC and the Urban Land Institute (ULI) that Calgary ranked first, knocking Toronto out of top spot.

Here is the summary of the top 4 cities:

Calgary (1). Growth characterizes Calgary’s future; it displaces Toronto as the top ranked city for 2013. This has made it challenging to acquire high quality real estate in Calgary, absorption of prime properties has reached record levels, and rents are being pushed due to limited supply. This trend will continue in 2013, especially in office and industrial employment space. Construction will increase in the housing and non-residential arenas, but nowhere near pre-crisis levels.

Edmonton (2). Real estate investors predict a good 2013 for Edmonton investment prospects. Edmonton is an example of a secondary market in search of high-quality real estate investments in strong economic locations. With Edmonton’s growth, comes more development and non-residential construction dominates the picture. Participants also rank Edmonton as the number one home building area.

Toronto (3). The number one market to watch in 2012, Toronto delivered mixed results and responses for 2013. Survey results show Toronto taking steps back in all three categories this year. Investment prospect values fell and the city’s rank went from first to third among nine Canadian markets. Interestingly, the investment prospect value for 2013 is exactly equal to the Emerging Trends historical average for Toronto. Even though Emerging Trends values are survey driven, this may be a sign that the Toronto market as a whole is in a state of equilibrium.

Vancouver (4). Vancouver’s economy has sharpened up and will look to continue that trend into 2013, but Emerging Trends survey results show declines in all three categories. The investment prospect value for Vancouver declined 0.47 points, and the rank dropped from second to fourth. An interviewee notes, “Overbuilt Vancouver is flat. Lots of supply.” Development prospects showed similar movement—down in value and rank, falling from first last year to fifth in 2013. Vancouver’s government red tape continues to make it more difficult to develop real estate every year. Homebuilding prospects also do not look as strong year-over-year—down from first to sixth.

You can read more about the survey here

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