Low inventory pushes up Calgary house prices in November

 A low inventory of active listings combined with increased sales has pushed Calgary home prices once again in an upward direction to a record high in November.

Statistics from the Calgary Real Estate Board indicate MLS sales in November rose by 18.74 per cent year-over-year to 1,730 transactions with the average sale price increasing by 5.56 per cent to $458,053 and the median price climbing by 8.50 per cent to $406,875.

The average sale price is a record for the month, eclipsing the $433,931 set in November 2012. The all-time high for any month is $466,495 in June this year.

Although new listings rose by 11.70 per cent to 1,823, active listings at the end of the month of 3,156 were down 17.62 per cent from a year ago. And days on the market to sell a home fell by 22 per cent to 39.

“Throughout the fall we have seen the market stay consistently strong as it has for the rest of 2013, with quick sales turnover and a low inventory of homes actively on the market. Coming into the winter months and even into the new year it doesn’t look like the market’s going to slow down backed by Calgary’s striving economy,” said Megan McCormick, realtor with Century 21 Bamber Realty Ltd.

“Prices and sales have continued to quickly rise with a large majority of new homeowners joining the marketplace, many leaving the tight rental market sooner than anticipated. A booming economy, record high employment rates, and homeowners being displaced by the flood are also pushing this high demand of Calgary homebuyers.”

According to Mike Fotiou, associate broker with First Place Realty, November set another record for luxury home sales as 50 properties sold in the $1-million plus price range, breaking the monthly record of 48 set last year. It’s the 10th straight month of a new monthly peak.

Fotiou said there have been 689 luxury home sales this year until the end of November, up 36.4 per cent from the 505 recorded for the same period in 2012. The previous annual record was 544 set last year.

In November, CREB’s stats show single-family home sales were up 18.99 per cent to 1,197 with the median price rising by 8.33 per cent to $455,000 and the average sale price increasing by 5.76 per cent to $516,447.

The condo apartment category saw sales of 305 during the month, up 20.55 per cent from last year. The median price rose by 3.85 per cent to $270,000 but the average sale price dropped by 1.1 per cent to $307,078.

In the condo townhouse category, sales increased 15.15 per cent from last year to 228. The median price was up 7.15 per cent to $310,150 and the average sale price rose by 12.07 per cent to $353,445.

Sales in the towns outside of Calgary rose by 17.78 per cent to 318 with the median price up by 8.64 per cent to $368,250 and the average sale price up by 15.61 per cent to $392,022.

CREB tracks what it calls benchmark prices for typical properties sold in the market. The benchmark prices in November with their year-over-year change were: total MLS city, $424,600, 9.21 per cent; towns, $347,900, 5.62 per cent; single-family, $470,600; 8.53 per cent; condo apartment, $279,600, 12.74 per cent; and condo townhouse, $305,700, 8.10 per cent.

Ann-Marie Lurie, CREB’s chief economist, said the low inventory in the Calgary residential market is a result of continued strong sales.

“It’s continued to push down inventory,” she said. “The level of new listings adds to supply and it hasn’t kept pace . . . Basically demand hasn’t let up.

“Another factor is also what’s happening in the new home sector. When you do tend to see inventory start to increase significantly sometimes it’s because there’s just too much in the new home market too . . . But because we’ve had such a strong influx of people and there’s been enough demand, even what they’re doing in the new home sector isn’t enough to push up inventory levels.”

Scott Bollinger, broker with the ComFree Commonsense Network, said what’s really striking about this month’s numbers is the big drop in inventory.

“New listings are up, for sure, but not enough to close the gap,” he said.

“Fall – well, let’s be honest, winter – timing is partly what’s at play here. It’s a low-volume time for Calgary real estate and even the bullish numbers can’t coax homeowners by the thousands into selling when it’s cold and snowy, especially when they’re confident the market will be just as strong in the spring. Most homeowners don’t want to sell and move during the winter, and that’s as good a reason as any that low inventory will persist till the snow melts.”

 

© Copyright (c) The Calgary Herald

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