Calgary resale housing market shifting to stability

The Calgary Real Estate Board says the city’s resale housing market is shifting to stability.

MLS sales activity in September showed transactions were up from year-ago levels for the third straight month. At the same time, the level of listings continued to ease but prices also were on a downward trend.

“Price declines have likely brought some buyers back into the market,” said Ann-Marie Lurie, the real estate board’s chief economist.

“While housing demand is modestly improving, sales activity remains relatively weak. The market is moving toward more stable conditions, but this is mostly related to supply adjustments in the city.”    

She said improvements in the market continue to be driven by homes priced below $500,000.

Here are the key stats from CREB’s September report:

  • MLS sales of 1,371 were up 8.21 per cent from last year;
  • Total dollar volume of $632.6 million rose by 7.14 per cent;
  • New listings fell by 12.05 per cent to 2,714;
  • Active listings at the end of the month of 6,889 were down 13.47 per cent;
  • Months of supply, which is the amount of time it would take to sell all the listings with the current demand, dropped by 20.03 per cent to 5.02 months;
  • The sales to new listings ratio of 50.52 per cent increased by 9.46 per cent;
  • The sales to list price ratio decreased by 0.09 per cent to 96.53 per cent;
  • The average days on the market to sell a home was up by 6.6 per cent to 59 days;
  • The benchmark price, which CREB says is typical of a home on the market, fell by 2.16 per cent to $424,900;
  • The median price of $405,000 was down 1.94 per cent; and
  • The average sale price was off by 0.98 per cent to $461,429.

“Despite improving sales and reductions in inventory, the overall market remains oversupplied. This continues to weigh on prices . . . These conditions continue to favour the buyer, but not to the same degree seen at this time last year,” says CREB.

Meanwhile, Calgary continues to be one of the most affordable major centres in Canada.

According to RBC’s Housing Trends and Affordability report, the share of income a Calgary household would need to cover ownership costs was 38.9 per cent in the second quarter of this year. The Canadian average was 51.3 per cent. 

The RBC Housing Affordability Measures show the proportion of median pre-tax household income that would be required to service the cost of mortgage payments (principal and interest), property taxes, and utilities based on the average market price for single-family detached homes and condo apartments, as well as for an overall aggregate of all housing types in a given market.

The measure for other major Canadian cities was 79.5 per cent for Vancouver, 66.3 per cent for Toronto, 44.5 per cent for Montreal, 41.7 per cent for Ottawa and 33.6 per cent for Edmonton.

“Owning a home got a little more affordable in Calgary this year. Not that affordability was a major issue to begin with. RBC’s aggregate measure has been near or below its long-term average over most of the past decade. RBC’s measure fell back-to-back in the first and second quarters to 38.9 per cent. Soft demand-supply conditions amid turbulence in Alberta’s energy sector have kept property values on a slight downward track. Early signs of a market turnaround have appeared this summer and bode well for prices to stabilize later this year,” wrote Robert Hogue, RBC’s Senior Economist, author of the report.

Calgary’s overall affordability measure was down from the long-term average which was 40.6 per cent since 1985.

For the city, the single-detached affordability measure was 42.9 per cent, down from the long-term average of 43.6 per cent. And it was 23.9 per cent for the condo market which was also down from the long-term average of 26.8 per cent.