CREB®Now sat down with CREB® chief economist Ann-Marie Lurie to discuss takeaways and surprises from the 2019 housing market in Calgary and area.
CREB®Now: Did 2019 play out the way you expected?
Lurie: Yes and no. Sales were a bit better than expected, partly because prices came in slightly lower than anticipated. Attached product sales activity was far stronger than expected, while the detached and apartment sectors were similar to last year. We had predicted that economic conditions wouldn’t change much, and that was the case, but the mortgage rate increase that many were foreseeing did not materialize. We also saw improvement in the market being driven by greater demand in the lower-priced sector (under $500,000).
CREB®Now: How did this year’s numbers compare to 2018?
Lurie: We generally saw sales slightly higher than 2018, yet still well below long-term averages. Though new listings are starting to come off, we are still in an oversupplied market right now, which is why prices declined last year.
CREB®Now: How did the market compare across different parts of the city?
Lurie: This really depends on the property type. The South and North West saw some improvements in detached sales, while the City Centre, West, East, North East and North saw declines. Detached prices declined across all areas, sitting at about four per cent below the previous year.
“The overarching theme playing out is the divergence in trends, where the lower-priced end of the market is seeing improvements and the higher end continues to struggle.”
CREB®Now: Which segments of the housing market saw the biggest changes in 2019
Lurie: The attached sector had sales growth of over six per cent compared to the previous year, and prices declined by four per cent. The apartment-style condo market has been oversupplied for some time, resulting in steady price declines. Compared to previous decreases, however, the rate of decline eased this year to just under three per cent.
CREB®Now: How did migration numbers play out?
Lurie: Migration this year was a bit lower than expected. Though we still had population growth of 1.5 per cent, the shift in migration is coming from international sources. This tends to have a different impact on the housing market, as newcomers often don’t end up in ownership right away, which has led to improvements in the rental market and lower vacancy rates.
CREB®Now: What did the big picture for surrounding communities look like in 2019?
Lurie: Airdrie saw sales improve and inventories decline. While lower inventories slowed the price decline, prices still dropped by three per cent. Okotoks sales improved this year, but 2018 was one of its weakest sales years in a decade, and prices declined by 3.8 per cent. Sales activity in Cochrane was similar to the previous year and prices saw a drop of 3.5 per cent.
CREB®Now: What were the key takeaways from this year?
Lurie: The overarching theme playing out is the divergence in trends, where the lower-priced end of the market is seeing improvements and the higher end continues to struggle. Citywide, we are seeing stability in sales, but the oversupply in the market continues to cause prices to fall.
CREB®Now: What can people expect in 2020?
Lurie: Though we can foresee more stable conditions in 2020, no earth-shattering changes are expected.