Too soon to see impact flood will have on resale statistics
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Sales activity in June exceeded growth expectations.
City of Calgary monthly residential sales totaled 2,317, a six per cent increase over June 2012 figures, and nearly five per cent higher than levels recorded in the first half of 2012. However, the impact of recent flooding is expected to trickle into the housing statistics over coming months.
“While sales and prices continue to show improvement, the city and residents of communities impacted by the recent flooding will face significant remediation challenges over the coming months,” said Ann-Marie Lurie, CREB® chief economist. “Until the extent of the damage is known, it is difficult to accurately assess the full impact this will have on the city’s housing market.”
The level of new listings totaled 3,003 units in the city, a nine per cent drop over the previous year. The rise in sales, combined with the drop in listings, is keeping overall market balance in favour of the seller.
Active listings totalled 4,584 units in June, of which more than 660 units are listed in flood-affected areas. Active listings are nearly 20 per cent less than last year.
“In the coming months, flood victims, particularly those who were planning on selling their homes, will have some big decisions to make,” said Becky Walters, CREB® President. “Will they take a discounted price? Or will they stay and fully remediate the property? Either way, in the short term, housing supply will likely be relatively tight.”
Condominium sales growth outpaced gains in the single family sector, as less availability of single-family homes priced at less than $500,000 have improved the demand for the relatively affordable condominium market.
After the first six months of the year, condominium apartment sales totalled 2,034 units a 9.5 per cent increase over 2012. Meanwhile, year-to-date condominium townhouse sales amounted to 1,672 units, up from 1,374 sales recorded in the first half of 2012.
“The tighter market conditions are placing upward pressure on pricing in all city sectors,” said Lurie. “While the areas affected by the flood may face some short-term impacts on pricing, any adjustments occurring are unlikely to outweigh the impacts on the overall city wide price growth.”
The benchmark price for condominium apartments and townhouses were a respective $264,000 and $295,000 for the month of June 2013. Condominium prices have increased by more than six per cent on a year-over-year basis, but remain below unadjusted peak levels.
Single-family sales activity totaled 1,638 units in June, a two per cent increase over 2012. However, after the first two quarters, single-family sales totaled 8,573 units, a one per cent increase over last year.
The single-family market moved into seller’s territory ahead of the condominium market, supporting stronger price growth. As of June the single-family benchmark price reached $459,700, a 6.7 per cent increase over the previous year.
“Prior to the events of the flood, our market was demonstrating tight supply levels, particularly for lower price product,” said Lurie.
Meanwhile economic indicators supported the growing demand in the city. Both the economic fallout and housing impact are yet to be seen. However, long-term economic prospects remain favourable for Calgary.