Housing recovery remains a work-in-progress
Market sees modest inventory gains, but overall prices inch up
Sales exhibited stable growth through the first half of the year in the Calgary housing market, but the number of transactions slowed slightly in July compared to last year.
City-wide sales totaled 1,637 units, six per cent below July 2016 levels. Year-to-date sales activity totaled 11,957 units, nine per cent above last year.
“Sales growth exceeded expectations so far this year. Clients were re-entering the market after delaying decisions until there were some signs of economic improvement,” said CREB® president David P. Brown.
“However, this recovery will require patience. There continues to be many new and resale ownership options available. This reduces the sense of the urgency for many consumers.”
Easing sales were met with higher new listings, causing further gains in inventory levels. City-wide months of supply rose to four months, as inventory levels reached 6,675 units this month. This is 17 per cent higher than last year, but still below July highs recorded in 2008.
“Modest improvements in the labour market and net migration were necessary to support the turnaround in the housing market,” said CREB® chief economist Ann-Marie Lurie.
“However, current inventory levels and changes in the lending market continue to weigh on housing demand. Easing demand growth combined with elevated levels of supply will slow the pace of price recovery in our market.”
Driven by detached and attached housing sales, city-wide prices in July improved over the previous month and the previous year. However, it is nearly four per cent below previous monthly highs. Year-to-date benchmark averages remain 0.44 per cent below last year’s levels.
Despite the current month activity, the detached sector continues to demonstrate conditions that are more balanced compared to last year.
Apartment condominium product continues to face oversupply in the resale and new home sector, causing further price declines. In July, the apartment benchmark price was $266,200. This is a three per cent decline over last year and nearly 12 per cent below peak prices.
For a full analysis of the Calgary housing market in 2017, please refer to CREB®’s 2017 mid-year update to be released in mid-August.