Calgary to escape price correction


TD Economics has forecasted that the national average resale price will drop 10.2% over 2012 and 2013. But it looks like Calgary will escape this downward trend largely because it's already gone through much of its correction.

TD Economics predicts the city's average price will rise to $405,800 in 2012, up from $403,700 in 2011. And by 2013, TD economics projects the average price will reach $410,500.

That's 1.7% increase in the average home value at the same time house prices in Vancouver are expected to drop 14.8% from its peak.

Calgary stands to gain even in the coming housing downturn because of its sound economic fundamentals. TD Economics expects crude oil to remain between $95 and $100 a barrel, a price at which energy companies can continue to make large profits and hire plenty more workers.

So now is the right time to invest while house values remain relatively low, said Sano Stante, president of the Calgary Real Estate Board.

"With interest rates still low and prices having been adjusted, affordability is high so it matches what you would pay monthly for a rental in Calgary," he told CRE Online.

But this trend also means investors must make their investments long term, since most residents will continue to choose home ownership over renting as long as interest rates stay low.

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