May sales activity continued to ease, with the largest declines occurring in the detached sector. Additional gains in new listings continued to increase inventory levels.
Citywide sales activity in May totalled 1,726 units, 19 per cent below last year’s levels and 24 per cent below longer-term averages. Sales activity in the detached sector declined to levels not seen in over a decade.
“The impact of rising lending rates and stricter qualification levels is causing demand to ease across all product types,” said CREB® chief economist Ann-Marie Lurie.
“Economic conditions have improved compared to several years ago, but the pace of economic recovery has not been enough to outweigh the changes in lending conditions.”
“THE IMPACT OF RISING LENDING RATES AND STRICTER QUALIFICATION LEVELS IS CAUSING DEMAND TO EASE ACROSS ALL PRODUCT TYPES.” – ANN-MARIE LURIE, CREB® CHIEF ECONOMIST
Market supply has not adjusted to the sales activity, pushing months of supply to 4.9 months. Elevated supply relative to demand prevented any further price recovery in the market, and citywide residential prices totalled $436,900 in May. This is similar to last month and 0.6 per cent below levels recorded last year.
Detached sales and inventories have risen across all price ranges, but the amount of excess supply has been most notable for homes priced above $500,000. Months of supply for the higher price ranges remain well below record highs.
“The changes in the lending market are preventing some people from moving up in the market. Uncertainty has also caused others to wait on making changes to their housing situation,” said CREB® president Tom Westcott.
“However, there are pockets of the market that have not seen the same supply increase. It makes it so important to understand the dynamics of your community.”
HOUSING MARKET FACTS
- Year-to-date detached sales in Calgary totalled 4,047 units. This is 21 per cent below last year’s levels and 26 per cent below long-term levels. Further gains in new listings across most districts pushed up inventory levels.
- Detached benchmark prices totaled $504,500 in May. This is similar to last month and 0.4 per cent below last year. Year-to-date benchmark prices are comparable to last year, but remain nearly four per cent below 2014 highs.
- Detached price changes have varied depending on the district. Compared to last year, year-to-date benchmark prices have risen in the City Centre and West areas, while remaining relatively stable in the North West, South and South East areas of the city.
- Apartment condominium sales totaled 1,104 units this year, a decline of nearly 12 per cent over last year. The number of new listings has eased slightly over last year and is preventing more significant gains in inventory levels. Overall, months of supply remain elevated in this sector, causing further declines in prices. Citywide unadjusted benchmark prices totalled $256,200 in May. This is slightly lower than last month, nearly four per cent below last year’s levels and 15 per cent below previous highs.
- Attached sales eased and new listings rose, causing further inventory gains and months of supply to push above five months. Overall, attached prices in May remained relatively stable. This was due to gains occurring in the townhome sector being offset by declines in the semi-detached market.
- Year-to-date semi-detached benchmark prices averaged $418,480, 0.5 per cent below last year. Price adjustments did vary by district, with easing occurring in the North West, West and South East areas. This offset the gains recorded in other districts of the city.
- Year-to-date row benchmark prices improved over last year’s levels due mostly to gains in the City Centre and West districts of the city. Row prices continue to remain over nine per cent lower than the unadjusted highs recorded in 2014.
REGIONAL MARKET FACTS
- Declining year-over-year sales continued in Airdrie. Sales during the month of May totalled 129 units. Year-to-date sales for 2018 have totalled 487 units. This is 14 per cent below sales levels for the equivalent period in 2017 and lower than the same period in each of the previous six years.
- Year-to-date new listings totalled 515 units for 2018 and have achieved a historical peak. This is eight per cent above last year and 16 per cent above long-term trends. Average inventories year-to-date have also increased by 26 percent compared to last year and are exhibiting a similar growth trend.
- Year-to-date benchmark prices for detached properties in Airdrie have been trending down for the past two years. Even with increasing levels of inventory combined with declining sales, the year-to-date benchmark price of $373,140 represents a modest decline compared to the same period in the previous year.
- Year-to-date residential sales totalled 251 units at the end of May. This is 4.2 per cent below the same period in 2017, but comparable to long-term averages.
- Supply increased five per cent and inventory increased 13 per cent in year-to-date listings. Year-to-date numbers have been significantly higher than long-term trends and have reached historical peaks.
- Like Airdrie, benchmark prices for detached properties in Cochrane have demonstrated a declining trend year-over-year for the past six months. Persistently high levels of supply in the market haven’t had an appreciable impact on the benchmark home prices, with detached properties valued at $422,520.
- Residential sales in Okotoks totalled 203 units from January to the end of May. This is 17 per cent lower than the same time last year and below sales levels from similar periods in previous years. Sales in May totalled 48 units.
- Inventories have been on the rise since January, with year-to-date average inventory increasing by 28 per cent. Adding to the supply on the market, new listings increased by 16 per cent and are consistently near long-term averages and close to historical peaks.
- Year-to-date benchmark prices for detached properties have stayed consistent, seeing a one per cent increase to $434,760 despite low sales and higher supply.
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