Here is a round-up of the most noteworthy events surrounding Calgary real estate in July, 2016.
Calgary Home Price Remain Steady...For Now
Seems like there’s a good reason why home prices in Calgary have remained fairly robust, despite the major economic downturn.
A memo obtained by CBC from the Internal Finance Department of the federal government states real estate values in Calgary has been minimally impacted because an estimated 56,000 itinerant works from the oil and gas sector have up and left the province. Those workers, who have been laid off, paid taxes in other provinces, and were not part of the buy and sell real estate process in Calgary and Alberta – they rented homes for the most part.
"Their departure is resulting in a lower number of unemployed in Alberta than would otherwise be the case, minimizing any downward pressure on the housing market (they are likely not Alberta homeowners — although the rental market may be affected)," states the document.
So for Calgary’s real estate market overall, while fewer homes are selling, the average sale price for 2016 so far is $479,464, which is a small drop of 0.5% from the average price in 2014.
The one caveat, however, is the hammer could still fall as real estate prices could still be impacted negatively as the downturn approaches a third year and into uncharted territory for Calgary and the rest of the province.
Bank of Canada Interest Rates Hold at 0.5%
The Bank of Canada continues to hold the prime interest rate at 0.5% as the economy remains in a slight downward turn.
However bank officials predict it will pickup in the second half of this year as exports are expected to soar, but the bank also warned about unsustainably high home prices in Vancouver and Toronto. For homeowners looking to renew their mortgages or buy a new home, the 0.5% rate means a great interest rate on 3-6 year fixed and variable mortgage loans with most national banks.
And economists don’t foresee a hike in the prime interest rate until the second quarter of 2019.
Luxury Homes Sales Up in Calgary
Despite the gloom and doom surrounding Calgary’s oil and gas economy, luxury home sales are on the rise.
A recently released report from Sotheby’s shows a 9% increase in the number of homes sold for more than $1 million, through the first six months of this year.
So far in 2016, total of 318 properties sold for more than $1 million, compared to 221 over the second half of last year. Of those sales, 289 homes changed hands in the $1-2 million range, while in the $2-million to $4-million range, 29 properties were sold. According to Sotheby’s, none were sold for more than $4 million.
Additionally, luxury homes in Calgary are selling faster. Through the second half of 2015, they needed an average of 68 days to sell. So far this year, it’s taken 52 days.
Ryan MacDonald, B.Sc. Real Estate Professional
Million Dollar Club Member
Top 1% Real Estate Professional in Calgary
O: 403.278.2900; F: 403.592.8008