New multi-family sales on the rise in Calgary
Strong demand from entry-level buyers an encouraging trend, analyst says
Sales of apartment-style condos and townhomes through Calgary’s new-home market are on the upswing this year.
There were 866 sales of multifamily units of all kinds in Calgary between March 1 and the end of May, says market research and advisory firm Urban Analytics. This was up 59 per cent from the previous quarter and 21 per cent from the same period in 2016.
For Urban Analytics, March 1 through the end of May is the second quarter of its tracking period.
“Strong demand from pricesensitive, entry-level buyers generated higher sales activity in the second quarter, particularly in the outer sub-markets in both the north and the south,” says Kimberly Poffenroth, senior market analyst for Urban Analytics.
“This trend is encouraging as it shows buyers are returning to the new-home market,” she adds. “These buyers wouldn’t purchase if they didn’t feel secure with the economy and their employment situation.”
Urban Analytics is now recording activity in 130 new apartment-style condo and townhome developments in the Calgary metropolitan area, including Airdrie and Cochrane.
Counting these smaller centres, the Calgary metropolitan area reached 944 sales of new multifamily units last quarter, with 53 in Airdrie and 25 in Cochrane. This was the first time Urban Analytics tracked activity in Cochrane, but for Airdrie, it was an increase from 38 transactions in the previous quarter.
But when looking into what fuelled the overall increase in sales of new multi-family units in the Calgary area last quarter, numbers from Urban Analytics point to areas it defines as the outer north and outer south.
The firm says sales in Calgary’s outer north increased 136 per cent to 305 deals from 129 in the previous quarter. The outer south grew 65 per cent to 336 sales from 204.
“Based on the product type we saw a high number of sales in, we do think it was a lot of the price-sensitive, entry-level buyers that were generating sales in the outer north and outer south,” Poffenroth says.
Calgary’s inner-city recorded improvement from the previous quarter, as well. An area Urban Analytics defines as inner-city southwest rallied to 49 sales from 28, quarter over quarter, while inner-city northwest increased to 84 from 67, and inner-city northeast inched up to 31 from 28. Inner-city southeast held steady with six sales in each of the last two quarters.
On movement in the inner-city northwest, the Urban Analytics report describes it being “primarily the result of strong absorptions at the Noble and Ivy projects in the emerging University District neighbourhood.”
Noble by Truman Homes and Ivy by Brookfield Residential are both in pre-construction sales for the opening phase of residential development at University District by West Campus Development Trust.
In looking at the performance of specific multi-family segments in the Calgary area, when it came to sales growth from the previous quarter, wood-frame condo developments took the lead.
There were 484 units sold in wood-frame developments be- tween March 1 and the end of May, up from 254 in the previous quarter, and 347 during the same period of 2016.
Townhomes also stepped up, with 365 sales last quarter, compared with 195 in the previous quarter and 258 deals year over year.
Urban Analytics says sales at wood-frame developments in the most recent quarter were paced by activity at Copperfield Park III, Legacy Park, Auburn Rise, Seton Park Place, Calligraphy at Westman Village, and Walden Place.
On the townhome end of the market, Elements of Nolan Hill, Chalet No6, Arrive at Evanston, and Cityscape, led the way, says Urban Analytics.
Concrete-built multi-family developments was the only segment not to have more sales on the books than in the previous quarter. It had 95 sales last quarter, flat with the previous three months, and down from 110 a year earlier.
While standing inventory of multi- family development in Calgary has been steadily on the rise, this came to an end over the last three months of data. Between March 1 and the end of May, inventory dipped to 939 units from 1,007 a quarter earlier.