Hope Springs Anew in Calgary

Hope Springs Anew in Calgary

After a long hard winter, portions of Canada’s economy are finally starting to see some upticks. Statistics Canada’s March 2016 Labour Force Survey revealed increased hiring and decreased unemployment for the nation as a whole. Alberta saw an increase in employment in the month of March. February’s unemployment rate in Alberta was 7.9%; this number declined to 7.1% in March. While still well above last year’s rate of 5.6%, it is a relief to see the numbers headed in the right direction. The city of Calgary still remains hard hit by the recent trials in the oil market with an unemployment rate of 8.4%.

However, the recent rebound in crude oil prices offers everyone a glimmer of springtime hope.

Has Housing Already Seen the Bottom?

Calgary area real estate sales have begun a small turnaround. The week of April 1-7 marks the first time in 2016 that Calgary area real estate sales exceeded 2015 levels. Part of the reason for the increase may be that March average home prices are down 1% compared to last year. Additionally, sellers are offering incentives to buyers who are waiting to see if the market has hit bottom. Despite the slight upturn, there are plenty of homes still on the market at reduced prices and many more homeowners who are waiting out the slump before listing. Canadian buyers looking at investment or vacation properties might not want to wait too long and the low Canadian dollar offers foreigners a prime buying opportunity.

Development Projects Add to Inventory

Calgary’s office and apartment rental markets are open for business—very open. Calgary’s office rental space has a 17% vacancy rate and rents are down 30%. Apartment vacancy rates in the Calgary area also remain high. Calgary’s residential rental inventory was relatively small in 2104 but development has increased inventory at a time when demand is down. Several completed condo units now on the market have added to the mix of choices for Calgary renters. A two-bedroom condo in Calgary currently rents for an average of $1,330. The Eau Claire Market and Northland Mall mixed-use redevelopments will add quality residential units as well as retail, hospitality, and office space.

Seller Resources – HOUSING STATISTICS : Calgary Total

Monthly Mar-15 Mar-16 % change Apr-15† Apr-16† % change
Total Sales 1,777 1,589 -10.58% 636 623 -2.04%
New Listings 3,129 3,228 3.16% 1,270 1,275 0.39%
Active Listings 5,704 6,102 6.98% 5,919 6,264 5.83%
Median Price 420,000 422,000 0.48% 428,950 427,500 -0.34%
Average Price 473,671 468,794 -1.03% 470,597 476,022 1.15%
Pending Sales 227 132 -41.85% 210 151 -28.10%
Days on Market 39 43 10.26% 39 45 15.38%
Benchmark Price 458,900 442,800 -3.51%
Annual/YTD 2014 2015 % change 2015 YTD 2016 YTD % change
Total Sales 25,543 18,837 -26.25% 4,497 4,107 -8.67%
New Listings 36,168 33,874 -6.34% 10,603 10,154 -4.23%
Median Price 425,600 424,000 -0.38% 420,000 420,000 0.00%
Average Price 482,072 469,399 -2.63% 467,037 469,089 0.44%
Pending Sales N/A 67 N/A 210 151 -28.10%
Days on Market 33 41 24.24% 38 45 18.42%
Benchmark Price 452,367 458,225 1.30%
Daily/Weekly Apr 12 Apr 11 Apr 10 Apr 6-12 /15 Apr 6-12 /16 % change
Total Sales 70 66 18 425 388 -8.71%
New Listings 110 93 46 749 793 5.87%
Active Listings 6,264 6,242 6,264 5,919 6,264 5.83%
Median Price 445,000 415,500 381,000 417,500 437,750 4.85%
Average Price 510,741 481,357 451,167 467,054 488,494 4.59%
Pending Sales 151 158 160 210 151 -28.10%
Days on Market 46 46 31 41 46 12.20%

Data from CREB CREB®

Millennials are Moving In

Recent reports indicate that Calgary is a destination city for those seeking affordable housing and room to grow.  Millennials, in particular, are leaving high-priced cities like Vancouver for Calgary. The province of Alberta now boasts the youngest median age (36 years) of citizens in the country. Meanwhile, Vancouver is ranked as one of the top three least affordable housing markets in the world. The vacancy rate for rentals in Vancouver is just .8 percent, making finding an apartment at any price difficult. Vancouver apartment rental costs rival those seen in Toronto. Calgary is an attractive landing place for the young and ambitious looking to settle down as it has one of the highest per capita densities of entrepreneurs in Canada. With ample office space and modern urban village developments, Calgary offers millennials opportunities to develop their careers and have a comfortable home.

Let’s hope this spring thaw in weather and markets continues.