Calgary repeat home sale price growth best in Canada

Calgary led the nation in July in annual price growth for repeat home sales.

The Teranet–National Bank National Composite House Price Index, released Wednesday, said Calgary prices were up by 8.2 per cent year-year-year while the national composite of 11 major centres in the country rose by 4.9 per cent.

The index is estimated by tracking ob­served or registered home prices over time using data collected from public land registries. All dwellings that have been sold at least twice are considered in the calculation of the index.

On a monthly basis, prices in Calgary rose by 0.6 per cent and they were up by 1.1 per cent nationally, which was the first time in five months that the monthly change in the composite index exceeded the historical average for the month in question. Prices were up on the month in 10 of the 11 metropolitan markets surveyed.

The report said the gain exceeded the countrywide average in five markets: Victoria (3.5 per cent), Ottawa-Gatineau (2.0 per cent), Toronto (1.8 per cent) and Quebec City and Hamilton (1.6 per cent). It lagged the average in Edmonton (1.0 per cent), Halifax (0.7 per cent), Calgary, Montreal (0.5 per cent) and Vancouver (0.2 per cent). For a third consecutive month, Winnipeg prices were down from the previous month (0.1 per cent ).

“July was the eighth month in a row in which the composite index did not fall. This countrywide performance was equalled in only one market, Edmonton, though Calgary came close with a seventh straight monthly increase,” it said.

The report said the countrywide average year-over-year was greatly exceeded in Calgary, Hamilton (7.1 per cent), Toronto (6.6 per cent) and Vancouver (6.1 per cent). The 12-month increase was more moderate in Edmonton (3.7 per cent), Victoria (2.5 per cent) and Montreal (1.5 per cent). Year-over-year prices were down in Winnipeg (0.1 per cent), Quebec City and Halifax (1.2 per cent) and in Ottawa-Gatineau (0.1 per cent).

© Copyright (c) The Calgary Herald

Calgary housing starts expected to dip in 2015 after significant growth this year

Housing starts in the Calgary region are forecast to rise by 24 per cent in 2014 from last year but then dip by 7.7 per cent in 2015, according to a new report released Wednesday by Canada Mortgage and Housing Corp.

The agency’s housing outlook says starts in the Calgary census metropolitan area will increase from 12,584 in 2013 to 15,600 this year but then fall to 14,400 next year.

For Alberta, starts are forecast to increase by 7.2 per cent this year to 38,600 units but decline by 4.7 per cent next year to 36,800 units.

The agency is expecting MLS sales in the Calgary region to improve by 9.8 per cent this year to 32,900 units and by another 2.4 per cent in 2015 to 33,700 transactions. CMHC says the average MLS sale price will rise by 5.0 per cent in 2014 to $459,000 and by 2.8 per cent in 2015 to $472,000.

For Alberta, MLS sales are forecast to be 5.8 per cent higher this year to 69,900 followed by a 2.9 per cent gain next year to 71,900.

The average sale price in the province is expected to increase by 4.2 per cent this year to $396,800 and by 2.6 per cent next year to $407,000.

© Copyright (c) The Calgary Herald

Calgary condo prices forecast to rise by 6.6 per cent this year

Calgary will lead the nation in price growth this year for the resale condo market.

In a report released Wednesday by the Conference Board of Canada, and commissioned by Genworth Canada, the median resale condo price in Calgary is forecast to rise by 6.6 per cent in 2014 to $271,413. And it will see further growth of 3.5 per cent in 2015 to $280,975, which will be the second best annual growth rate in the country behind Victoria’s 4.0 per cent.

The Summer 2014 Metropolitan Condo Outlook examined condo markets in eight Canadian cities and found that population, economic and employment growth all point to a stabilizing of the Canadian market, and while pockets of higher risk still exist in Toronto and Vancouver, a broad-based downturn is unlikely.

“Calgary’s economic vitality is spurring employment and population growth, essential underpinnings of robust housing demand,” said the report. “Apartment condominium markets are responding. Resale volumes and price growth are advancing briskly, while nearly exhausted inventories of unsold new units will spur starts. The following few years look decent, as ongoing economic and income growth will maintain housing requirements.”

It said a healthy economy, along with low mortgage rates, helped lift sales of existing apartments to a post-recession high of 4,454 units in 2013, with volumes higher in the year’s second half. Annualized sales in the first quarter of this year were the highest since 2007 and transactions are forecast to end the year at just under 4,900 units with similar volumes expected in 2015 and “slight upticks thereafter putting them near boom-era levels.”

The report said a 6.6 per cent price hike this year would exceed the 20-year average hike of 6.1 per cent for the first time in six years.

“Calgary’s excellent housing affordability is the product of both healthy average household incomes – the highest among our report’s eight cities – and relatively modest apartment condominium prices – these were lower only in Quebec City and Edmonton last year,” it said.

“This put Calgary in a virtual tie with Edmonton for the lowest carrying costs as a proportioin of average household income among this report’s eight cities – 10.7 per cent and 10.6 per cent respectively.”

The conference board said the new construction outlook is also robust as the absorption of new units tripled between the cyclical low in 2011 and 2013.

“Last year’s take-up of 2,929 units was a five-year high and could well have been larger if not for the floods,” said the board. “The strong demand for new apartment condominiums cut the inventory of newly completed and unoccupied apartments to 208 units on average during 2013, and year-end volumes were much lower. This was well below stocks that approached 800 units in 2010.”

The report said a jump in absorptions to over 4,800 units at an annual rate during the first quarter of this year has virtually depleted unsold stocks and set the stage for take-up of nearly 3,400 units this year.

“Builders will act quickly to meet this demand, boosting apartment condominium starts to a six-year high of nearly 3,500 units, after flooding contributed to a 19 per cent pull back to 2,736 units in 2013,” said the board.

© Copyright (c) The Calgary Herald

Alberta homebuyers concerned about protecting personal information

Alberta homebuyers are the most concerned today in the country about safeguarding their personal information, according to a survey by Equifax Canada.

The survey found that 86.4 per cent of Albertans said they are more worried today about protecting their personal information than they were a year ago. The national average was 79.4 per cent.

“Consumers and lenders are certainly becoming more wary of the potential threats related to fraud and identity theft,” said Tim Ashby, vice-president of personal solutions for Equifax Canada, in a news release. “In the homebuying process, a lot of personal data is on the table when dealing with mortgage brokers, real estate agents, and lawyers among others.”

The survey found that 81 per cent of consumers overall believe that lenders should be doing more to protect them from fraud and identity theft.

It also found that one in 10 Canadians agreed it is okay to inflate their annual income when applying for a mortgage and nine per cent agreed that they had not been entirely truthful on a credit or loan application.

“Make no mistake, lying on your loan application is a type of mortgage fraud,” said Ashby. “Whether you’re a lender or a consumer, data protection and the integrity of the data should be priorities at all times. For the consumer, it’s not just a matter of protecting your information, it’s critical to know what’s on your credit file – especially when looking to buy a new home.”

© Copyright (c) The Calgary Herald

Calgary closing in on Vancouver and Toronto for title of wealthiest city

Vancouver, Toronto and Calgary remain the wealthiest cities in the country but the gap between them in average household net worth is narrowing, according to data released Monday by Environics Analytics, a marketing services and data analytics company.

WealthScapes 2014, a database on the assets, liabilities and wealth of Canadians to December 2013, found that the average household net worth in Vancouver was $710,095 followed by Toronto at $693,652 and Calgary at $680,377.

“But the difference in affluence is getting smaller as the net worth in Vancouver, Toronto and Calgary grew by 6.5 per cent, 8.8 per cent, and 10.8 per cent, respectively, compared to 2012,” it said. “While increases in liquid asset and debt were similar among the three cities, the key differentiator was real estate values — up a modest 2.8 per cent in Vancouver, a strong 6.6 per cent in Toronto and roaring 9.1 per cent in Calgary.

“Vancouver continues to reign as Canada’s wealthiest city because of its pricey real estate — averaging $579,250 per household compared to $535,002 in Toronto and $485,364 in Calgary. Canada’s most populous city, Toronto, benefitted from a 6.1 per cent rise in savings — nearly triple the national average — and a 3.7 percent decline in consumer debt — which is a significant drop given that nationwide consumer debt remained essentially unchanged. And in addition to its healthy real estate performance, Calgary benefitted from a 2.9 per cent decline in consumer debt; those two indicators ranked among the best for large cities.”

The database found that net worth for Canadians in general was up 7.7 percent over the previous year to $442,130, consumer debt was flat and real estate performed more predictably compared to recent years — increasing a solid six per cent over 2012. In a release, it said the data revealed that not only are the rich (the top fifth of the populace) getting richer — their net worth increased 8.1 per cent over the previous year — but the poor (the bottom fifth) are feeling more flush too, with their net worth rising 8.7 per cent.

The three wealthiest provinces at the end of 2012 retained their top status at the end of 2013 – British Columbia with a net worth of $591,047); Alberta at $531,067 and Ontario at $523,969).

“Third-ranked Alberta had a good year — its net worth grew by 10.0 per cent — and it leap-frogged Ontario in the standings, becoming the second wealthiest province in Canada,” said Environics Analytics.