Slower economic activity influenced demand across the region in the first quarter of 2015. However, despite rising inventory levels, housing prices in Calgary’s surrounding areas remained relatively stable, said CREB®’s latest Surrounding Area Quarterly report.
“A lack of recovery in oil has many concerned about their employment status and these concerns have been impacting consumer confidence in the first quarter,” said CREB® chief economist Ann-Marie Lurie. “However, on aggregate, surrounding area prices have posted some quarterly growth as some of these areas have not recorded the same level of pull-back in sales relative to inventory levels.”
Unadjusted benchmark prices for residential properties in the surrounding areas were nearly one per cent above average levels recorded in the previous quarter and 8.4 per cent above levels recorded in the first quarter of 2014. City of Calgary prices have started to retract, but it is important to note that total residential benchmark prices in Calgary recovered from 2007 highs in 2013. In surrounding areas, prices only surpassed previous highs last year.
Residential sales in surrounding areas totaled 911 units in the first quarter of 2015, a 22.7 percent decline compared to the same time last year. Meanwhile, new listings increased by 11.6 per cent and inventories averaged 1,715 for the quarter, pushing the quarterly average months of inventory to 5.65.
“With improved first quarter supply in both the city of Calgary and the surrounding areas, consumers will definitely have more housing options,” said CREB® president Corinne Lyall. “Each of the surrounding areas has their own unique dynamic, so it’s really important to consider the community and specific segment of the market that you are buying or selling in when making any real estate decisions.”
Sales in Airdrie totaled 302 units in the first quarter of 2015, a 10.1 per cent decline relative to the same time last year. Over the same period, benchmark prices in Airdrie continued to increase in the first quarter. In fact, quarterly detached prices averaged $397,867 in the first quarter, which amounts to a 0.24 per cent increase over the previous quarter and a year-over-year increase of 8.4 per cent.
Cochrane had a similar experience where quarterly detached prices averaged $445,033 in the first quarter, a 2.6 per cent increase over the previous quarter and a year-over-year increase of 12.5 per cent. Meanwhile, first quarter sales totaled 116 units at the end of March, a 35 per cent decline over the same time last year.
“Cochrane’s resale sector often has a different dynamic than some of the other surrounding areas as there is a larger share of new home sales representing total sales activity,” said Lurie. “After the first quarter, new home sales activity represented nearly 20 per cent of total sales in Cochrane, compared to 10 per cent in Airdrie and five per cent in Okotoks.”
In Okotoks, detached benchmark prices averaged $453,567 in the first quarter of this year, a 1.23 per cent increase relative to the fourth quarter of 2014 and 6.98 per cent higher than the first quarter of 2014. During this period, Okotoks sales activity totaled 117 units, a 21.5 per cent decline compared to last year. Relative to Airdrie and Cochrane, detached properties make up the largest share of sales in Okotoks.