Calgary housing sees steep decline

Home resales are down 30 per cent year- over- year, prices dip 1.2 per cent

Calgary’s resale housing market saw the country’s steepest yearoveryear sales decline among major cities last month, says the Canadian Real Estate Association.

While Canadian MLS sales jumped by 9.5 per cent from a year earlier, Calgary area sales sank 30 per cent, to 2,215 transactions, it reported Wednesday. Saskatoon had the next biggest annual decline at 9 per cent. Conversely, sales in Greater Vancouver soared by 53 per cent.

Across Alberta, sales declined by 20 per cent to 5,131 transactions. April does not appear any more promising, with sales down 36 per cent from a year ago, according to Calgary Real Estate Board data.

A similar story hit average selling prices which rose nationally by 9.4 per cent, to $ 439,144, but declined 1.2 per cent in Calgary to $ 457,422 and by 10 per cent in Alberta to $ 398,856.

CREA’s home price index, which tracks the benchmark price of socalled typical properties sold in a market, showed an annual increase of 4.95 per cent across 12 Canadian cities surveyed, led by Greater Toronto at 7.85 per cent and Greater Vancouver at 7.2 per cent. The benchmark price increase in Calgary was 4.1 per cent.

Gary MacLean, a realtor with RE/ MAX Real Estate Central in Calgary, said the median and average sale prices of single- family homes and condos in Calgary have remained depressed since peaking in March 2014.

“This occurred long before oil prices crashed,” he said.

Meanwhile, property listings continue to rise.

More than 5,800 Calgary properties were for sale on MLS listings this week compared to about 3,600 a year ago.

“If we did not list another home, we would have a supply for at least four or five months,” said MacLean. “The thing that is concerning is we are in our peak listing period of April and May and more and more homes will be coming to market in an already overcrowded market place.”

If sales remain depressed and listings continue to increase, prices will have to move lower, he said.

“As long as oil prices remain low and people remain afraid they might be laid off or have friends who have been laid off, they will remain cautious about buying,” he said. “Sellers must price their homes competitively. If they are the least bit overpriced, they will just sit there.”

In a separate report Wednesday, Royal LePage said prices in the city have slowed but remained positive during the first quarter of 2015.

It said the average price for detached bungalows increased 3.8 per cent to $ 498,400 compared to last year while standard two- storey homes increased 1.7 per cent to $ 480,656. Standard condominiums recorded moderate growth of 2.9 per cent to $ 286,913.

“Everyone is expecting prices to drop but they’re not,” said Ted Zaharko, broker and owner of Royal LePage Foothills, in Calgary.

He said there is still demand in the market with new listings in high demand neighbourhoods receiving multiple offers.

Zaharko said he believes the depressed oil price situation is shortterm and that the real estate market will rebound in the second half of this year.

“For the last seven months of the year, I think that will come to fruition,” he said.

Nationally, Royal LePage found the average price of detached bungalows was up 6.6 per cent to $ 405,895.

It said a steady softening of prices in most markets was seen in the middle of last year.

“In recent months, two unanticipated factors disrupted the natural housing price cycle: the steep decline in oil prices late in 2014 and the Bank of Canada’s subsequent reaction in lowering the overnight rate early in 2015,” its report said.

The thing that is concerning is we are in our peak listing period ... and more and more homes will be coming to market.