The month of December turned out to be a pretty decent month for total sales in the City of Calgary, which were 933, a 6.14% increase over December 2015, however it was still 10% below the typical December over the past 10 years, which means the Calgary market still has lots of room to improve. In order to gain real insight into what is happening in the Calgary real estate market one must drill down into each of the various market segments to understand how the economy has impacted each segment.
Looking at the detached homes segment, total sales in December were 571, 7% higher then the previous December, however total sales in 2016 were down slightly 2.6% vs 2015 (11,214 vs 11,519). However even though sales are down slgithly from last year, this market continues to be very balanced due to low inventories which stand at 1,719, 20% below last years inventory. Months supply of homes is 3.01 and sales to new listings stands at 110%, which means we had more sales in the month of December then new listings. Many buyers continue to think home prices should be falling considering the economic uncertainties that are facing the Oil and Gas sector, however the balanced market is acting in a different manner. The only way we will get a price reduction in 2017 is if we see a large increase in the number of new listings, either because people are leaving the city or province, or individuals begin to declare bankruptcy, which forces them to sell their homes. A spike in either of those two stats could lead to increased competition between sellers that would in turn lead to price reductions. However, until that happens prices will continue to remain steady and could even see a bit of an increase in certain price brackets due to the low inventory levels.
The apartment segment is not fairing nearly as well, as sales in December fell 4% year over year, 146 sales in 2016 vs 152 sales in 2015, this was a consistent trend through out the year as total sales in 2016 were 2,728 vs 3,228 in 2015 a 15.5% decrease year over year, and 27% below the 10 year average. Thus the condo market has been slow, days on market has increased to 71, along with the months supply of inventory increasing to 7.59 while prices have been falling throughout the year as sellers compete over the limited number of buyers in the market. Benchmark price for condos has fallen 6% from 2015 to 2016. All things considered, we will probably continue to see prices creep downward in 2017.
The attached home segment performance falls somewhere in between the other two segments. It finished the year strong with total sales in December increasing 11.34% year over year (194 vs 216), however total sales fell 5.5% in 2016 vs 2015 (3,867 in 2016 vs 4,092 in 2015). Inventories have continued to fall and are currently at 938 which is 13.7% less then December 2015, while months supply of inventory has fallen to 4.34. Depending on how many new listings come on the market in the first three months of the year, this market could look at balancing out in 2017.
So if you are looking for a deal, there are deals to be had in the apartment and attached home segment. While there are less deals to be had in the detached home segment, you can find the odd property that is competitively priced, but beware there are other buyers scouring around for those same deals.
Happy house hunting in 2017!
The Calgary Homefinders