Just a couple of short months ago there was a lot of discussion about the rule changes put in place for mortgages and how they would create a housing correction nationally. This has occurred in Toronto and Vancouver as both cities witness sales activity declining but Calgary is bucking this trend with increases in both prices and sales.
Calgary has seen growth in migration, overall confidence and full-time employment. Consumers have approached the housing market with caution since the recession but are now more confident to go ahead with a home purchase due to reasonable interest rates, below peak home prices and bullish economic forecasts for the local economy.
Inventory levels for single-family homes were down 20% from 2011 supply levels with 3,646 units on the market in June. Some consumers may have decided to delay listing their homes and upgrading while they reevaluate their budget due to this tighter supply and the changing mortgage rules. If, however, these levels of supply stay low, consumers will begin to turn towards the market for new homes.
There are fewer listings in the single-family market down 7.5% compared to July 2011. Listings for condominium apartments are down 3.1%. Some relief was provided to the demand and supply balance due to the seasonal slowing of sales in July over June 2012.
Increased sales along with this lower inventory have led to price gains that were higher than anticipated. The benchmark price for a single-family home was $432,400 in July, which represents a 7.8% increase over July of last year. This increase, however, has only risen 5% based on a year-to-date basis.
Employment opportunities in Calgary are offering a sense of security in the job market, which gives residents and migrants the confidence needed to take advantage of the stable market for housing in the city.
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