“Calgary’s resale housing market has experienced a whirlwind start to the year. And while oil price recovery has been slower than originally expected, there are positive signs of change on the horizon,” writes CREB® announcing a mid-year forecast update which will be released at the end of this month.
Back in January, the CREB® forecast was optimistic considering what the December data was signaling. A sales decline of only -4% and an increase in home prices in 2015? It seemed wishful, especially since no one had any idea of where oil prices were headed and for how long.
So where are we six months later? Year-to-date sales are down -25% compared to the same period last year. That forecast missed the mark and will unlikely make any ground in the second half of the year. But prices have been holding up remarkably well with the YTD benchmark price still up 3.3% at the end of June.
In fact, the market outlook for Calgary has changed significantly enough from the beginning of the year when TD stated that the Calgary market was likely to correct, that they released a revision this past Friday.
TD Economics is now expecting a -24.7% drop in sales this year before posting a slight uptick of 1.7% in 2016. Originally, sales were forecast to fall -47.2% this year and a further -1.9% next year.
Average prices are projected to fall by only -1.7% this year instead of the -4.4% predicted in February. And rather than prices dropping a further -3.4% next year, prices will see a 0.4% bump instead. If that’s how it transpires, then we’d be extremely fortunate to come through this downturn relatively unscathed.
July figures continue to point to a stabilizing market. Sales are plodding along the 10-year average pace and are keeping new listings from adding any significant volume to overall inventory. Prices are essentially flat with the median price up 2.37% MTD and the average down -0.71%.
After “the whirlwind start to the year”, this change of pace is welcome.