Calgary Home Prices Only 1% Off Peak

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.

Teranet - National Bank HPI, Y/Y percentage change for Calgary

Y/Y percentage change for Calgary

Calgary Index

Calgary Index

HPI for Canada

HPI for Canada

5 responses to “Calgary Home Prices Only 1% Off Peak

  1. Hi Mike, I’m confused, could you please explain how it’s down 1% when your own stats site says average was down 6.10% in Oct year over year and down 5.43% to date in Nov.

    Why aren’t we talking actual values and not made up numbers to make it all sound better.

  2. Nick, I write about the benchmark, average, median and, yes, index prices for readers to make informed decisions.

    People are free to track whichever price metric they wish and I report on all of them. Teranet released October’s data today and thus this post.

    Like I replied to another reader, if you think the average is the most accurate indicator of price in a market where million dollar+ sales are down over 50%, then knock yourself out.

    But I would wager that last year you were arguing the exact opposite when luxury sales were hitting record highs 😉

  3. Huh, why would I be arguing anything last year? I am just trying to understand how a company called Teranet got these numbers you are posting and was hoping you could clarify. So what you’re saying is they are meaningless?

    Teranet-National Bank collects sales data from public land registries. Nowhere did I even remotely hint at their index being meaningless.
    -Mike Fotiou

  4. Hi Mike I’m still confused then. Why isn’t the data your site shows the same data that Teranet collects? How (and why?) are these data different. This is what really confuses me about these articles about housing stats – different sources (all supposedly using the same data – there is only one housing market) are claiming different results. As an agent shouldn’t you be representing the most accurate data – I would have entrusted MLS to be the most accurate? If you’re posting someone else’s results as news – as my agent should you at least be able to explain how they got to that conclusion when it differs from the data that your website is showing?

  5. Nick, they do not all use the same data or reference the same geographic boundaries which is why each price metric sheds a little more light on the overall picture.

    Teranet-National Bank uses repeat sales methodology to calculate their index. Only homes that have sold at least twice are used, which means that new homes are excluded from the calculation. Data is collected from the public land registries.

    Statistics Canada’s New Housing Price Index (NHPI) only includes, you guessed it, new homes – but apartment condos are excluded in their builder survey.

    MLS® average, median & benchmark price data doesn’t include homes that were sold privately/by owner or sales from new home builders that weren’t listed on MLS®.

    Each of them also can have different geographic boundaries. For example, the NHPI and Teranet uses Calgary CMA which includes Airdrie, Beiseker, Chestermere, Cochrane, Crossfield, Irricana, Rocky View Country and Tsuu T’ina Nation.

    The MLS® also has different boundaries depending on what you’re researching.

    Calgary CMA: includes City of Calgary, Airdrie and the Region of Rockyview
    -City of Calgary: includes residential activity within city limits.
    Calgary Economic Region

    And of course, these can be further broken down by community and property type.

    That’s why there are so many different reports. Each is a little different piece of the overall housing market puzzle.

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