If someone had told you back in January that Calgary home prices would only be -1% off the peak ten months in, you may have dismissed it as wishful thinking.
Yet, here we are. The Calgary market has been more resilient than many have expected.
According to the Teranet-National Bank House Price Index, Calgary prices in October were down -1% from a year ago when we were at peak. Between September and October, prices pulled back -0.8%.
Calgary real estate conditions were spectacular in 2014, and that momentum has helped propel the market through a turbulent economy this year. But that residual strength has waned. Sales remain depressed and inventory is growing. Prices will slowly bleed.
However, this isn’t like 2008/2009 when the global financial crisis shut off the lending taps and brought the market to a halt. No, not everyone has been affected by the energy sector downturn equally. That’s why you’ll see homes in the higher price brackets impacted more than those in the lower price range.
For example, between 10/11/2015 and 11/11/2015, there were 84 homes sold between $600,000-700,000 with 408 currently homes still for sale. That’s an inventory absorption rate of 4.9 months, deep into a buyer’s market.
During the same dates, 325 homes sold in the $400k-$500k price range with an inventory of 652 remaining. That’s only a 2 month supply.
Clearly, sellers with homes priced between $600-$700k will need to be more aggressively priced in order to compete than those listed for under $500k.
Whether buying or selling, it’s important to drill-down to the specific property type, price range and community to find out how the market is truly performing in your desired area.