Oct
3
Article From Calgary Sun (Quotations by The Calgary Real Estate Blog)
After a year of listening to experts saying the Metro Calgary real estate market was returning to normal, we may finally have reached it.
MLS sales statistics for September were released this week by the Calgary Real Estate Board, and in the single-family market, sales last month were up about 9% from September last year. Granted, it’s not a very big increase, but any increase is good news.
Also notable is the end of month inventory of single-family homes - last month it stood at 5,387 units, down — again ever so slightly — from 5,562 homes in September 2007.
New listings coming to the market last month were 2,631, down 15% from last September. Also taking a slight dip was the year-to-date average sales price, which reached $464,445 to the end of September, a 2.4% decrease.
In these cases, decreases are good news.
I wouldn’t count on the market completely turning around just yet… we will need more than one month’s data to show that in fact the market is turning. The market will take time to turn around and one month’s data doesn’t prove that we are on solid track.
The fact average prices are down, if only marginally, is a sign sellers have realized listed prices were too high and they are now pricing their homes with the market in mind, not greed, although another influencing factor is sales of lower priced homes are higher this year than last and sales of homes priced at $1 million are down, year-over-year, which brings down the average.
However, fewer listings and lower month-end inventory levels, should they continue, will have the effect of stabilizing average prices and may even cause the average to increase, year-over-year, in the coming months.
In towns and cities included in the Calgary CMA, but outside of city limits, the story is a little different, with month-end inventory up year-over-year, to 2,607 homes from 1,965, although new listings added in September were down — 850 compared to 877. This is really is no surprise because these markets are usually several months behind the trends set in Calgary and the fact sales were up in these areas indicates they may be close to reaching more normal levels.
The area of concern is condominiums in Metro Calgary.
At the end of September, there were 2,607 units listed, up from 2,235 last September, though new listings added in September declined 10%.
The number of condos listed for sale takes the overall Calgary real estate market out of ‘normal’ and back to ‘returning to normal’ and the problem has the potential to grow, as more condos will be added in the next six to seven months as some of the larger high-rise apartment buildings in the inner city are completed. As the new owners take possession, and if condo sales don’t increase significantly in that time, the questions is, will they list them for sale if they were bought on speculation, or put them into the rental market?
If they list them, the rate of decline of the average condo sales price will increase. If they put them into the rental pool, the decline rate will not be as severe and may even flatten out. Let’s hope for a lot of For Rent signs.
I completely agree that the condo market will be over heated and ‘full’ over the coming months. There will most likely be many individuals who lined up and bought on speculation and will be needing to get rid of their ‘great idea purchase’. Never line up for condos…. NEVER…. and to make it worse… DO BUY ON SPECULATION… you will get busted one time or another…
If your looking for solid investments, look at long term hold with a great real estate team around you to bring you to your goal…
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