July 1-7, 2013 Calgary Real Estate Update

At this early stage it appears that the impact of the flooding has been negligible on the overall Calgary market.

There were only 10 fewer sales in the first week of July compared to last year, despite the following:

  1. Recall that it was on July 9th of last year that the most recent round of mortgage tightening took effect.   Buyers didn’t have much time from when the changes were first announced on June 19th to take action, but it likely accelerated sales briefly before the July 9th implementation period.  July 1-7, 2012 sales were up 24.7% from the same period in 2011.
  2. Active listings (inventory) is down a whopping -19.63% from this time last year.  That’s 1,110 fewer listings for buyers to choose from.
  3. Prices are up year-over-year, eroding affordability.  At the end of June, the overall Benchmark price was up +6.79%, median up +3.32% and the average up 5.63%.
  4. Stampede week started a day earlier this year.   Ok, that one is a bit of a stretch, but then again we’re only talking about a difference of 10 sales 😛

By the way, average home prices are up over 13% y/y this month.  This spread will decrease in the coming weeks as more sales are posted,  but because of the strength of the luxury market  average prices will still be boosted.

This is a record of sorts:  it’s the first time ever 3 homes have sold for $4,000,000 or over in the same month.

Eighteen homes have sold for a million plus the first week of July.

Calgary home sales: July 1-7

Calgary home sales: July 1-7

July 1-7 year-over-year comparison (click to enlarge)

July 1-7 year-over-year comparison (click to enlarge)


3 responses to “July 1-7, 2013 Calgary Real Estate Update

  1. What’s the difference between the Benchmark price and the median price? I had thought the median price, because of its reliability, is considered to be the benchmark price 😦

  2. Hello Anonymous,

    I’m quite partial to both the median and benchmark price. It’s the average price that I don’t really pay much attention to because of how easily it’s skewed by luxury sales.

    The median price is attained by lining up all the sales from smallest to largest (or vice versa) and locating the “middle” sale. For example, let say we had five sales:

    1) $100,000
    2) $200,000
    3) $300,000
    4) $400,000
    5) $1,000,000

    The median price would be $300,000. If there were an even number of sales, the median price would be the average of the 2 “middle” sales.

    The average price is calculated by adding up all the sale prices and dividing by the number of sales. In the above example the average would be $400,000.

    Here’s CREB’s definition of the benchmark figure:

    What is a benchmark home?
    A benchmark home is a model of a “typical” home in a given area. It is composed of a set of attributes typical of homes in the area where it is located, and remains constant over time. However, since “typical” homes are different from one area to the next, the descriptions of benchmark homes differ between areas as well.

    Benchmark property descriptions are based on median values for quantitative property attributes (e.g., above-ground living area in square feet), and by the most commonly occurring value (i.e., modal value) for each qualitative attribute (e.g., basement is not finished).

    Benchmark home prices are estimated based solely on these “typical” homes. By comparison, actual MLS® HPI values refer to homes whose attributes differ, so they are based on a broader set of properties in each housing category.

    For example, the above-ground living area for a benchmark property in a given area may be 800 square feet, whereas the MLS® HPI would include homes in the same category whose above-ground living area varies.

    So, while the benchmark prices are useful for comparing price levels and price growth for benchmark homes, the MLS® HPI is a better source of information on general price trends in each housing category.

    Benchmark prices in each of the housing categories tracked by the MLS® HPI are available for the overall market. This enables benchmark home prices and price changes to be compared across areas, and with the overall market.

    If you aren’t comfortable using the benchmark figure because it can’t really be duplicated, that’s fine. The median is still an effective market indicator, just not as precise.

  3. Real Estate In Vaughan

    Eighteen homes have sold for a million plus the first week of July. Just Wow! It should be a good going.

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