Calgary luxury home resale market sets all-time record May establishes peak level for MLS sales

An all-time record has been set this month for the most sales ever for $1-million plus MLS properties in Calgary.

According to Mike Fotiou, associate broker with First Place Realty, as of late Friday afternoon there have been 88 sales in the luxury market so far this month, eclipsing the previous record of 83 set in May 2013.

There have been 85 single-family homes and three condos sold at the luxury level this month.

The most expensive sale was at $4.85 million in the Bel-Aire neighbourhood.

The neighbourhoods of Altadore/River Park and Aspen Woods are leading the way with nine luxury sales each for the month.

The Calgary residential real estate market set an annual record last year for most sales ever at that price point and it is on pace this year to break that mark.

In 2013, there were 732 MLS luxury transactions, eclipsing the previous record of 544 in 2012.


Growing rate of first-time homebuyers 55% of homes bought in 2013

Low interest rates and good economic conditions have first-time homebuyers entering the Canadian housing market in “substantial’ numbers, according to a report released Thursday by the Canadian Association of Accredited Mortgage Professionals.

Its latest consumer survey report, Looking for a “New Normal” in the Residential Mortgage Market, found that “homeowners appear to be happy with the decision to buy their home.”

“They say they feel confident they can weather a downturn in the housing market and they consider mortgage debt to be good debt. Their attitudes are the same whether they live in Toronto, Calgary or Vancouver where prices continue to rise, or in areas where home prices are stabilizing,” said the report.

The report found that 55 per cent of homes purchased in 2013 were bought by first-time buyers. It also found that 66 per cent agree in some degree that mortgages are a form of “good debt.”

More than 80 per cent of homeowners in Canada have 25 per cent or more equity in their homes, it said.

“First-time homebuyers in Calgary have been getting involved in the housing market. With relatively low mortgage rates, many of these buyers have had the opportunity to purchase their first home. Low rental vacancies and rising rents have also contributed to demand from first-time homebuyers,” said Richard Cho, senior market analyst in Calgary for the Canada Mortgage and Housing Corp.

Ann-Marie Lurie, chief economist with the Calgary Real Estate Board, said there is no way of saying with certainty how many purchasers are first-time homebuyers in the local market.

“Typically we assume that many first-time homebuyers are purchasing product at the entry prices in the market. However, there can be other groups purchasing in this price point that are not first-time homebuyers (such as) people downsizing),” she said.

“If we look at Calgary in 2013, 22 per cent of the sales were priced below $300,000, and another 27 per cent of the sales activity occurred in the $300,000 to $399,999 price range. While we do not know the exact number of first-time homebuyers that entered the market last year, tight rental markets, low lending rates, relatively favourable affordability and a positive economic outlook is encouraging consumers to consider ownership.”

The mortgage professionals’ report said the average mortgage interest rate is 3.24 per cent, a drop from the average of 3.5 per cent found in the fall 2013 survey.

“From the consumer perspective we have a picture of a very confident, healthy mortgage market,” said Jim Murphy, president and chief executive of the organization. “Key to the current stability in the mortgage market is the fact that Canadians continue to pay down their mortgage debt faster than they are required and they continue to take out five-year, fixed rate mortgages. Canadians who renew their mortgages are seeing their interest costs reduced, which is boosting their personal financial circumstances, and this will continue to be a positive force during the coming year.”

Will Dunning, the organization’s chief economist, said the housing market across Canada is slowing and has been on a downward swing since the mortgage policy change in 2012.

“While the national market may look healthy, activity in the Greater Toronto Area (including Hamilton), the Greater Vancouver Regional District and the Calgary area is skewing the numbers high,” he said. “In the rest of Canada sales activity has weakened and house prices are flat, and even falling in some communities. Housing has played a key role in driving economic growth and job creation in Canada. But looking ahead, decreased starts and slower price growth will throw off the balance between the housing market and the overall economy.”