… even though there is a higher inventory and drop in sales….
Despite the highest inventory levels in many years, coupled with a drop in sales, prices in MLS housing markets in the Calgary area are holding their own.
“A lack of recovery in oil has many concerned about their employment status and these concerns have been impacting consumer confidence in the first quarter,” said Ann-Marie Lurie, chief economist for the Calgary Real Estate Board (CREB). “However, on aggregate, surrounding area prices have posted some quarterly growth as some of these areas have not recorded the same level of pull-back in sales relative to inventory levels.”
Unadjusted benchmark prices for residential properties in the surrounding areas were close to 1% above average levels recorded in the previous quarter and 8.4% above levels recorded in the first quarter of 2014.
“City of Calgary prices have started to retract, but it is important to note that total residential benchmark prices in Calgary recovered from 2007 highs in 2013,” said Lurie. “In surrounding areas, prices only surpassed previous highs last year.”
Sales in surrounding areas were 911 homes in the first quarter of 2015, a 22.7% decline compared to the same time last year. New listings increased by 11.6% and inventories averaged 1,715 for the quarter, pushing the quarterly average months of inventory to 5.65.
“With improved first quarter supply in both the city of Calgary and the surrounding areas, consumers will definitely have more housing options,” said CREB president Corinne Lyall. “Each of the surrounding areas has its own unique dynamic, so it’s really important to consider the community and specific segment of the market that you are buying or selling in when making any real estate decisions.”
In Airdrie, sales reached 302 homes in the first quarter of 2015, a 10% decline compared to the same time last year. Over the first three months of the year, benchmark prices in Airdrie increased in the first quarter, with detached-home prices averaging $397,867, a 0.24% increase over the previous quarter and a year-over-year increase of 8.4%.
It’s a similar story in Cochrane, where quarterly detached-home prices averaged $445,033 in the first quarter, up 2.6% over the previous quarter and a year-over-year increase of 12.5%. First quarter sales in Cochrane were 116 homes, a 35% decline over the same time last year.
“Cochrane’s resale sector often has a different dynamic than some of the other surrounding areas as there is a larger share of new home sales representing total sales activity,” said Lurie. “After the first quarter, new home sales activity represented nearly 20% of total sales in Cochrane, compared to 10% in Airdrie and 5% in Okotoks.”
In the latter, the detached-home benchmark price averaged $453,567 in the first quarter of this year, up 1.23% from the fourth quarter of 2014 and 7% higher than the first quarter of 2014. Sales in Okotoks in the first quarter of 2015 reached 117 units, a 21.5% decline compared to last year. Relative to Airdrie and Cochrane, detached properties make up the largest share of sales in Okotoks.
BY MYKE THOMAS, CALGARY SUN