Calgary kicked off 2022 on a strong note. But, the city’s rising popularity hinges on a few factors
A recovering energy industry, rebounding downtown commercial market and a competitive tax environment — all at a more affordable price point — have been working in tandem to drive a resurgence in Calgary real estate, according to industry watchers.
Alberta’s largest city kicked off 2022 on a strong note, setting a record for first quarter home sales.
Unit sales were up 58 per cent over last year, with 9,413 homes changing hands, according the Calgary Real Estate Board’s quarterly housing update report, released last week. That beat out a previous record of 8,286 set in the first quarter of 2007, before the Financial Crisis. The city’s benchmark price also hit $496,767, a jump of 15 per cent year over year.
While the gains still trailed those in the Greater Toronto Area (18 per cent), the Greater Vancouver Area (20 per cent) and Montreal (17 per cent), Calgary’s rebound comes after years of home price losses following the Financial Crisis and again during the oil downturn in 2015.
The city’s rising popularity hinges on a few factors, one of the largest being inter-provincial buyers from Ontario and British Columbia who have shifted toward the Alberta market as a cheaper remote-work or investment option.
“We see Ontarians who can work from home and still want a fairly large city and like being close to the mountains (who say), ‘I’m going to move to Calgary but still keep my old job, and prices are half, because why not?’” Dan Eisner, founder and chief executive officer of Calgary-based True North Mortgage, told the Financial Post.
“Then of course, we also see that oil prices recovered substantially and as much as we Calgarians want to expand our industries, oil is still a really, really big mover here,” Eisner added.
Oil is still a really, really big mover here
Dan Eisner
CREB noted a jump in new listings was one of the factors driving sales volumes, with listings rising 32 per cent to 12,616 units over last year. But even with more homes coming to market, conditions remain tight by most measures.
“Conditions have not been this tight since 2006, which was also the last time that we saw price gains push above 15 per cent,” the report read.
Michael Waters, chief executive officer of housing developer Minto Group, told Financial Post he had been seeing a spike in demand as inventories remain low.
“The inventories (in Calgary) are very low,” Water said. “It’s definitely in a seller’s market when you look at sales-to-listing ratios and things of that nature. So, Calgary — depending on how you look at it — has benefited or been part of the same kind of Canada-wide phenomenon in terms of dwindling inventories of homes to purchase.”
Waters added there was some debate on whether Calgary home sales would strengthen along with the rest of the country.
“In fact it did, we did see housing market really strengthen there,” Waters said. “So, vendors of homes were seeing relatively less competing supply and if you were buying, you had to look a lot harder to find something and prices moved as well.”
Jared Chamberlain, owner of the Calgary-based Chamberlain Group, said this shift caught many in the industry off-guard.
“Mid-January 2022, we felt the change happen quickly. We saw ten to 15 out-of-town inquiries a day at that point to our team,” Jared told the Post in an e-mail, adding many were moving across the country seeking more affordable options. “It did catch us off-guard. We did see other buyers in 2021 do the same, but the floodgates opened once the clock turned over to 2022.”
While energy is a strong driver in Calgary home prices, Eisner noted that there was less exuberance in the oil market this time around compared to the boom of 2006, suggesting the downturn will not be as stark now. The city was also able to diversify its economy and create more of a buffer from shocks to the market.
“When I look downtown, there’s a lot of IT firms that are opening up in Calgary,” Eisner said. “And so, Calgary has made some advances on diversifying its economy a little bit and that will support some prices even if oil takes a tumble.”
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TORONTO – The Toronto Regional Real Estate Board says home sales in October surged as buyers continued moving off the sidelines amid lower interest rates.
The board said 6,658 homes changed hands last month in the Greater Toronto Area, up 44.4 per cent compared with 4,611 in the same month last year. Sales were up 14 per cent from September on a seasonally adjusted basis.
The average selling price was up 1.1 per cent compared with a year earlier at $1,135,215. The composite benchmark price, meant to represent the typical home, was down 3.3 per cent year-over-year.
“While we are still early in the Bank of Canada’s rate cutting cycle, it definitely does appear that an increasing number of buyers moved off the sidelines and back into the marketplace in October,” said TRREB president Jennifer Pearce in a news release.
“The positive affordability picture brought about by lower borrowing costs and relatively flat home prices prompted this improvement in market activity.”
The Bank of Canada has slashed its key interest rate four times since June, including a half-percentage point cut on Oct. 23. The rate now stands at 3.75 per cent, down from the high of five per cent that deterred many would-be buyers from the housing market.
New listings last month totalled 15,328, up 4.3 per cent from a year earlier.
In the City of Toronto, there were 2,509 sales last month, a 37.6 per cent jump from October 2023. Throughout the rest of the GTA, home sales rose 48.9 per cent to 4,149.
The sales uptick is encouraging, said Cameron Forbes, general manager and broker for Re/Max Realtron Realty Inc., who added the figures for October were stronger than he anticipated.
“I thought they’d be up for sure, but not necessarily that much,” said Forbes.
“Obviously, the 50 basis points was certainly a great move in the right direction. I just thought it would take more to get things going.”
He said it shows confidence in the market is returning faster than expected, especially among existing homeowners looking for a new property.
“The average consumer who’s employed and may have been able to get some increases in their wages over the last little bit to make up some ground with inflation, I think they’re confident, so they’re looking in the market.
“The conditions are nice because you’ve got a little more time, you’ve got more choice, you’ve got fewer other buyers to compete against.”
All property types saw more sales in October compared with a year ago throughout the GTA.
Townhouses led the surge with 56.8 per cent more sales, followed by detached homes at 46.6 per cent and semi-detached homes at 44 per cent. There were 33.4 per cent more condos that changed hands year-over-year.
“Market conditions did tighten in October, but there is still a lot of inventory and therefore choice for homebuyers,” said TRREB chief market analyst Jason Mercer.
“This choice will keep home price growth moderate over the next few months. However, as inventory is absorbed and home construction continues to lag population growth, selling price growth will accelerate, likely as we move through the spring of 2025.”
This report by The Canadian Press was first published Nov. 6, 2024.
The Canadian Press. All rights reserved.
HALIFAX – A village of tiny homes is set to open next month in a Halifax suburb, the latest project by the provincial government to address homelessness.
Located in Lower Sackville, N.S., the tiny home community will house up to 34 people when the first 26 units open Nov. 4.
Another 35 people are scheduled to move in when construction on another 29 units should be complete in December, under a partnership between the province, the Halifax Regional Municipality, United Way Halifax, The Shaw Group and Dexter Construction.
The province invested $9.4 million to build the village and will contribute $935,000 annually for operating costs.
Residents have been chosen from a list of people experiencing homelessness maintained by the Affordable Housing Association of Nova Scotia.
They will pay rent that is tied to their income for a unit that is fully furnished with a private bathroom, shower and a kitchen equipped with a cooktop, small fridge and microwave.
The Atlantic Community Shelters Society will also provide support to residents, ranging from counselling and mental health supports to employment and educational services.
This report by The Canadian Press was first published Oct. 24, 2024.
The Canadian Press. All rights reserved.
Housing affordability is a key issue in the provincial election campaign in British Columbia, particularly in major centres.
Here are some statistics about housing in B.C. from the Canada Mortgage and Housing Corporation’s 2024 Rental Market Report, issued in January, and the B.C. Real Estate Association’s August 2024 report.
Average residential home price in B.C.: $938,500
Average price in greater Vancouver (2024 year to date): $1,304,438
Average price in greater Victoria (2024 year to date): $979,103
Average price in the Okanagan (2024 year to date): $748,015
Average two-bedroom purpose-built rental in Vancouver: $2,181
Average two-bedroom purpose-built rental in Victoria: $1,839
Average two-bedroom purpose-built rental in Canada: $1,359
Rental vacancy rate in Vancouver: 0.9 per cent
How much more do new renters in Vancouver pay compared with renters who have occupied their home for at least a year: 27 per cent
This report by The Canadian Press was first published Oct. 17, 2024.
The Canadian Press. All rights reserved.
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