When it comes to purchasing the house of their dreams, those living in Calgary are willing to go just a little further to ensure they get what they want.
According to a report released by BMO, 38 per cent of Calgarians were willing to outbid the competition to get the home they wanted. The number marks an increase of six points, or 21 per cent, from a year ago. Calgary ranked third of the cities included in the report, with those living in Toronto and Vancouver the most likely to make multiple offers at 44 per cent and 41 per cent respectively.
“Calgary’s market continues to see the strongest fundamentals; Vancouver has rebounded from a soft patch; while Toronto’s market remains relatively balanced overall, though the condo market is more amply supplied,” said Robert Kavcic, Senior Economist, BMO Capital Markets. “Overall, sales are expected to hold relatively steady in the year ahead, with price growth in the low single-digit range, below the rate of income growth.”
Contributing to the desire to compete are the conditions found in the Calgary market right now. Following double digit gains last month, sales growth in the city of Calgary totaled 1,854 units, or an 8.68 per cent increase over the same period in 2013. Slower sales growth resulted in a reduction of listings in the single family sector.
“Demand growth in the single-family sector has been restricted by the availability of product,” said CREB® Chief Economist Ann-Marie Lurie. “New listings in this sector fell for the second consecutive month, causing further tightening in an already undersupplied market.”
Despite a 5.7 per cent rise in single-family sales through the first two months of the year, new listings in the sector have dropped by 6.6 per cent. The unadjusted benchmark price for a single-family home in Calgary totalled $482,800 in February, a 1.28 per cent increase over the previous month and a 9.1 per cent increase over the previous year.
Provincially, the BMO report said Albertans as a whole were actually the least willing to outbid others on a home, at just 30 per cent. Prospective buyers in the Prairies and British Columbia are the most willing to compete on the price of a home at 38 per cent respectively.
“Many times we may have multiple offers and still sell under list price,” said CREB® President Bill Kirk. “The best scenario is that you will have three independent opinions of what the property is worth, so you truly hear the voice of the market.”