Calgary home sales soar 59 per cent from May

Calgary shares in a national upturn in sales but its home prices are down from last year and remain among lowest among Canada’s big cities

By
Western Investor
July 15, 2020





Calgary house for $500,000
— Three-bedroom Calgary house listed for $500,000. Realtor.ca

Housing sales in Calgary surged 55 per cent in June compared to a month earlier, part of a national recovery that has seen housing sales defy predictions of a prolonged COVID-19 slowdown.

Across Canada, June sales were up 63 per cent from a month earlier and 150 per cent above where they were in June, according to the Canadian Real Estate Association (CREA).

The sales spike is in sharp contrast to a recent forecast from Canada Mortgage and Housing Corp. (CMHC) for a steady decline in housing sales and prices this year.

CMHC had predicted that average housing prices would fall by 9 per cent to 18 per cent this year. As of June, however, the average price for a home sold through the multiple listing service of real estate boards was up 5.4 per cent from a year earlier and 0.5 per cent higher than in May.

“The market has recovered much faster than many would have thought, but what happens later this year remains a big question mark. That said, daily tracking suggests that July, at least, will be even stronger,” said Shaun Cathcart, CREA's senior economist.

Calgary’s sales increase in June was indicative to action in major markets across Western Canada. Sales were up month-over-month by 60.3 per cent in Greater Vancouver, 59 per cent in Edmonton and 22.5 per cent in Winnipeg, CREA noted.

The Calgary Real Estate Board (CREB) injected a note of caution while it celebrated the upturn.

“Recent price declines, easing mortgage rates and early easing of social restrictions are likely contributing to the better-than-expected sales this month,” said CREB chief economist Ann-Marie Lurie. “However, the market remains far from normal. Challenges, such as double-digit unemployment rates, will continue to weigh on the market for months to come.”

She added that Calgary sales remain about 2 per cent lower than in June of 2019.

June sales activity was high enough to cause the months of supply to dip below four months for the first time since May 2019, according to CREB data.

 “If this trend continues, it should help to ease the downward pressure on prices,” Lurie said.

The benchmark composite price of a Calgary home is now $405,200, down 2.8 per cent from a year ago and well below the national benchmark price of $538,831 as of June.

 


Frank O'Brien is the editor of Western Canada's biggest commercial real estate newspaper, Western Investor, as well as a contributing editor at West Coast Condominium, real estate contributor to Business in Vancouver and a regular media commentator on real estate investment.
Copyright © Western Investor

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