As Calgary is starting to see a tightening trend in the real estate market, some buyers are turning their attentions to surrounding areas for a place to call home.
While activity varied by area, overall property sales in the communities of Cochrane, Airdrie and Okotoks totaled 865 units in the first quarter of the year, similar to numbers seen from the same time in 2012.
“Relatively strong demand has reduced the amount of time properties are on the market,” said Becky Walters, CREB® president. “However, overall inventory levels remain healthy, contributing to balanced conditions for buyers and sellers.”
Okotoks reported 18 per cent growth in sales activity compared to the first quarter of 2012. While sales activity for Cochrane slowed in March, strong activity in the first two months of the year resulted in sales growth exceeding six per cent.
“The improvement in sales activity in Okotoks is due to inventory levels being slightly elevated, unlike some of the other surrounding areas,” said Ann-Marie Lurie, CREB®’s chief economist. “This provides consumers with choice even though there has been a 15 per cent decline in new listings.
“If dwindling supplies for singlefamily homes persist within Calgary city limits, it should support growth in outer lying communities,” Lurie continued. “However, as resale listings fall, consumers may turn to new homes, and such a move could limit sales growth for resale products.”
With jobs in both Chestermere and Calgary, making the decision to build a home of their own in Airdrie was an easy one for Jodi Rogers and Dave Beckford.
“We like Airdrie because it’s small and quiet, but it still has everything that you need,” said Rogers. “And we chose to build there because it’s so much more affordable than building in Calgary, I mean, you can get the same size of house with everything that you need but we got it for under $300,000 and you can’t find that in Calgary.”
Budget was also a deciding factor in Rogers and Beckford deciding to build a new home as opposed to buying a home in the resale market.
“When we took a quick peek at (resale homes) that were in our budget, the houses were quite a bit older so we were probably going to have to renovate quite a bit and then it would take (more) out of our budget whereas again, because we could build so affordably, we could get exactly what we wanted.”
Compared to the first quarter of 2012, Airdrie experienced a 12 per cent decrease in total sales. New listings were also down from 471 in the first quarter of 2012 to 411 in the first quarter of 2013, however the sales to listing ratio of the two first quarters remained the same at 0.64 per cent. Similar to the market seen in Calgary, Airdrie’s tighter market conditions could result in the average price of homes in the area increasing.
In March, the benchmark price for a typical singlefamily home in Cochrane ($401,800) remained the most expensive of the three communities, but it’s still six per cent below peak pricing in the market. Benchmark pricing for the same single-family style home in Okotoks is $374,000 followed by Airdrie at $348,300.
Benchmark pricing represents the price of a typical property within a market taking into account things such as number of rooms, whether or not a basement is finished and the size of a lot.
Other communities surrounding Calgary are seeing sales pick up now that spring has sprung. In Chestermere there were 24 sales in March compared to 12 in February while Langdon went from two February sales to 14 in March and Strathmore sales more than doubled from 14 to 30.