Demand for detached housing continues to rise
The detached housing market continues to lead the way in Calgary’s slow but steady recovery from a two-year recession. It is the fourth consecutive month of price increases in this segment of the market.
For the first time since June 2015, prices for detached homes did not decline on a year-over-year basis. Unadjusted detached benchmark prices reached $509,000 in May – one per cent higher than last month and levels recorded last year.
Detached sales improved across all price ranges and represented 65 per cent of all Calgary sales in May, the highest level since 2012. The largest detached sales growth occurred in the $600,000 – $999,999 range.
“The economic climate is supporting detached housing market recovery,” said CREB® chief economist Ann-Marie Lurie.
“Improved demand and easing supply has created more balanced conditions and ultimately some modest price gains. While it will still take some time for prices to recover, the transition in the detached segment is an important first step to stabilization across all segments of the housing market.”
Like the detached market, the attached product has moved towards more balanced conditions. This has supported some recent directional shifts in pricing. However, monthly price declines had fallen by 4.7 per cent over peak levels and year-to-date benchmark prices remain two per cent below last year’s levels.
“We can really see a slow but sure recovery in the housing market,” said CREB® president David P. Brown. “Demand for detached product is driving a new sense of optimism for consumers as we move further into spring.”
The number of new listings rose to 3,866 units in May, which is 17 per cent higher than last year’s total for the month. Despite this rise, year-to-date new listings have declined by one per cent over last year.
We can really see a slow but sure recovery in the housing market. Demand for detached product is driving a new sense of optimism for consumers as we move further into spring.
“With the change in market dynamics, people no longer feel like they may need to settle for a second choice in a property,” said Brown. “There are lots of housing choices in every segment of the market and that made for a good situation in an already active spring market.”
Inventories are continuing to rise on the apartment condominium side. As of May, there was an inventory in Calgary of 1,780 in May. This is 11 per cent higher than last year’s levels and accounts for nearly 30 per cent of city-wide inventory. Apartment benchmark prices totaled $271,200 in May.
The housing market outside Calgary mirrors the continued recovery in the city.
Airdrie was active during the month of May, totalling 146 units sold. This brings total residential sales to 569 units since January, which is four per cent above sales levels for the same period in 2016.
With residential sales totalling 262 units at the end of May, Cochrane has seen an 11.5 per cent increase over the same period during 2016. So far this year, sales growth has outpaced the growth in new listings, contributing to the easing of inventories and months of supply compared to last year.
Rising sales combined with listings easing has placed downward pressure on inventories in Okotoks. Residential sales in Okotoks totaled 245 units from January to the end of May, six per cent higher than the same period last year.