Back in January CREB released a ridiculously aggressive forecast for 2011. Thankfully, the forecast has now been revised to better reflect market reality. At least now if real estate ends up performing better than this new forecast projects, it can be said that the Calgary market ‘exceeded expectations’ which sounds a whole lot better than the alternative. (Please note: CREB’s new senior economist was not the author of the January forecast)
2011 SFH sales were revised downward to 13,100 from 14,500. This translates into a 7.7% increase over last year rather than the 19.9% increase originally forecast. The average price was reduced $10,000 to $470,000 which would still be an almost 2% increase from last year.
One of the positive revisions was that the amount of new listings coming onto the market was less than originally anticipated. For 2011, it’s forecast that there will be 24,500 new homes listed compared to 25,000.
Condo sales were greatly revised – it’s estimated there will be 5,100 sales this year which translates to a -1.7% drop from last year. Compare that to the original forecast of 6,000 sales which would’ve been a 15.8% yoy increase. The forecast average condo price was slightly downgraded to $290,000 from $295,900.
Unlike SFH, new listings are expected to be higher than originally thought: 10,800 rather than just 10,000.
You can view the new forecast summary below as well as compare to what was released back in January.
Some highlights (which are expanded upon in the report) are:
- Energy investment will be the primarystimulus to economic growth in Alberta and Calgary.
- Employment growth in full-time positions will attract a wide range of migrants from both other provinces and international sources.
- Relatively low interest rates will continue to provide monetary stimulus to the housing market.
- Improved range of single family homes on the market, combined with relatively stable pricing, will continue to boost sales.
- Condominium market is on the path to recovery as improving demand, combined with reduced supply, is reducing inventory levels.
- Resale home prices are expected to remain stable as demand growth can be accommodated through the supply of housing stock.
- Downgrades in Alberta and Calgary growth may occur if U.S. economic growth contracts
Related post: My thoughts on 2011 forecast (January)
You can read the entire report below: