Monthly Market Report - February 2018

A Bumpy Road to Recovery Calgary housing market prices hold, but sales fall Feb. 2018 

City of Calgary, March 1, 2018 – Residential home sales declined in February, but a decline in new listings helped keep prices steady this month. Sales totaled 1,094 units in February, 18 per cent below last year’s activity. Easing sales occurred across all property types this month, which outpaced the sales growth that occurred in January. After the first two months of the year, sales activity remains well below longerterm averages. “Housing market conditions are still adjusting to rising lending rates and changes in lending requirements. This process is expected to be bumpy, with demand adjustments leading the changes,” said CREB® chief economist Ann-Marie Lurie. “However, it is important to remember that it is early in the process and the impact on prices will ultimately be dependent on the supply response.” A decline in new listings was not enough to prevent further gains in inventory levels, but it offset some of the impact of slower sales activity. In the detached sector, activity in the $600,000 - $999,999 range recorded the largest gains in supply relative to sales. “This is a market where the fundamentals of a sound pricing strategy need to be understood by sellers. At the same time, savvy buyers typically have a clear understanding of how much of a mortgage they can get,” said CREB® president Tom Westcott. “With all the recent changes, potential purchasers should be obtaining pre-approvals so they understand exactly what they can afford prior to making an offer on a home. It also provides them flexibility in this market.” Citywide benchmark prices totaled $434,300 in February, which is just above levels recorded last month, but comparable to last years levels. While year-over-year price growth remained relatively stable in both the detached and attached markets, apartment prices remained three per cent below last year’s levels. 

• Year-to-date sales activity remained below long-term norms for all districts within the city, but year-over-year price adjustments ranged from over six per cent declines to four per cent gains, depending on district and property type. 
• After the first two months of the year, detached sales totaled 1,240 units. This is 12 per cent below last year and 22 per cent below long-term averages. When considering supply levels in the market, conditions have remained relatively unchanged, as months of supply continues to sit just below four months. Detached benchmark prices this year have averaged $501,100, similar to levels recorded last year. 
• The apartment condominium market continues to remain oversupplied, with months of supply averaging nearly eight months so far this year, which is higher than the average of seven months recorded over the same time last year. Elevated supply levels are preventing any price recovery, as the benchmark price has averaged $256,300 this year, three per cent below last year. 
• Semi-detached and row product continue to demonstrate different levels of oversupply, impacting price recovery. Semi-detached prices have averaged $417,300 so far this year, over one per cent higher than levels recorded last year. Meanwhile, row prices continue to ease and are averaging $296,050 over the same time frame.

Mike Baylis 
RE/MAX House of Real Estate