The city’s resale housing market will benefit from consumer confidence in the later part of 2012 pushing MLS sales and average prices higher for the year, says a forecast released Wednesday by the Calgary Real Estate Board.
At its annual forecast breakfast, CREB predicted single-family home sales would jump 12.2 per cent in 2012 to 14,800 transactions while the average sale price would increase by 2.1 per cent to $476,000.
It also forecasts year-over-year sales growth of 5.9 per cent for condominiums to 5,700 units with the average price increasing by 1.7 per cent to $292,000.
And in the towns outside Calgary market, CREB foresees a 3.6 per cent hike in sales to 3,900 transactions and a 0.2 per cent rise in the average sale price to $355,000.
“As the market moves into balanced territory, there will be more opportunities for both buyers and sellers in this market,” said incoming CREB president Bob Jablonski.
“2012 will provide consumers with stable price growth in a low interest rate environment, encouraging both the first-time buyers and the move-up buyers to be more active in the marketplace.”
“While the uncertainty in the global markets is not boosting consumer confidence, strong economic fundamentals point to improvements occurring throughout 2012,” said CREB’s 2012 economic outlook and regional housing market forecast. “The economic uncertainty will continue to weigh on consumer confidence in the first portion of 2012 — limiting activity; however, as the benefits of employment growth and migration settle in, confidence in the local economy will trickle into the resale housing market, moving activity to levels more consistent with long-term trends.
“With no anticipated changes to the interest rate, mortgage rates will remain at historical lows and will continue to support housing demand. This, combined with anticipated wage growth and no significant upward pressure on housing prices, will support affordability levels in Calgary’s housing market throughout 2012.”
The report said the expected increase in sales activity in the single-family market reflects strong employment and migration gains in the city.
Those gains will also boost demand in the condo market as will lower supply in the single-family market.
“Furthermore, reduced condominium construction levels over the past two years will help alleviate some of the supply pressures,” said CREB.
Last year at this time, CREB forecast annual sales for single-family homes to hit 14,500 units and increase by 19.9 per cent in 2011 from the previous year. Condos were forecast for 6,000 sales, up 15.8 per cent. The forecast for the single-family average sale price was $480,000, up 4.1 per cent, and $295,900 for condos, up 1.8 per cent.
But what actually transpired in 2011 was a completely different picture.
There were 13,186 single-family home sales, increasing by 9.06 per cent, and the average sale price was $466,402, up 1.14 per cent. Condo sales were 5,382, up 3.98 per cent, and the average price was $287,172, down 0.94 per cent.
Here’s what some others have forecast for the market in 2012: Royal LePage predicts the average price will rise 3.6 per cent and sales will be up by 10.6 per cent; RE/MAX forecasts sales up by five per cent and the average price to increase by three per cent; TD Economics sees sales up by 0.1 per cent and the average price to increase by 0.5 per cent; and Canada Mortgage and Housing Corporation is calling for a sales increase of 2.3 per cent and a price increase of 2.2 per cent.
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