It will take time to balance the oversupplied Calgary market

by Steve Randall03 Dec 2019

Oversupply in the Calgary housing market is slowly improving but it will take time to achieve balance.

Calgary Real Estate Board says that year-to-date sales are just above 2018 levels and sales in November gained in two of the three main property types.

There was an easing of new listings relative to sales but elevated inventory is pressuring prices; the citywide unadjusted benchmark was $419,100, down slightly month-over-month and down 2% year-over-year.

“Achieving more stable conditions will take time. Sales activity has been settling in at lower levels and is likely being influenced by the economic conditions and uncertainty weighing on our market,” said CREB® chief economist Ann-Marie Lurie.

Stats by property type

November sales gained for two out of the three main property types.

For the detached sector, sales were up year-over-year with the $400,000-$500,000 price range dominating.

But sales activity was low by historical standards and detached sales are 20% below long-term trends on a year-to-date basis, despite some gains, especially in the North West and South districts.

There has been an easing of inventory, but it remains elevated and that is pressuring prices with the unadjusted benchmark price at $481,500 in November, slightly lower than last month’s levels and 2% below last year’s prices.

For the apartment sector, sales pulled back in November and holding year-to-date sales in line with year-ago levels and 21% below long-term averages.

There were declining sales for the City Centre, North West and South East districts, but on a year-to-date basis, sales activity improved in the North, West and South East districts.

New listings continued to rise but year-to-date new listings and inventories remain lower than last year’s levels, although still at more than 7 months of supply, two months more than a year ago.

Persistent oversupply led to the year-to-date benchmark price declining by more than 2%.

The attached sector continued to outperform the wider market with year-to-date sales more than 6% higher than last year’s levels and just below long-term averages.

Inventories have eased with fewer new listings and, while still oversupplied, there has been improvement compared to a year ago.

November semi-detached prices eased by 2% compared to last year with the largest year-over-year declines occurred in the City Centre district.

Meanwhile, row prices eased by nearly 4% year-over-year with annual declines ranging from more than 7% in the North East district to nearly 2% in the North West and East districts.

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