Inventory rises, but sellers’ market conditions persist

City of Calgary, May 2021

With 2,989 sales, housing market activity hit a new May record.

Despite strong levels of sales, they did trend down relative to last month. Additionally, there were 4,562 new listings, causing seasonally adjusted inventory levels to increase over last month.

“The recent gains in prices have encouraged more homeowners to list their homes and take advantage of the current market situation,” said CREB® chief economist Ann-Marie Lurie.

“However, the inventory gains are still not enough to offset the demand growth and the market continues to favour the seller. Prices are rising, but they are still recovering in our market from previous highs in 2014. Only detached and semi-detached home prices in certain districts and communities have recovered to the level of previous monthly highs.” The months of supply did trend up slightly this month to just over two months, but it was not enough to halt the upward pressure on prices. The unadjusted benchmark price in May reached $455,200. This is one per cent higher than last month and nearly 11 per cent higher than prices recorded last year.

Sales have been rising across all product types, but homes priced above $600,000 represent a larger-than-usual share of all sales. The upper end of the market only reflected 16 per cent of city sales last May, compared with this year where it now reflects nearly 26 percent of all sales.

View the full report here: May 2021 Report

Demand for homes remains high with record sales in April

City of Calgary, April 2021

There were 3,209 sales in April, a new record high for the month, as Calgary’s housing market continues to bounce back from the pandemic lows recorded in 2020.

“Despite entering the third wave of COVID-19, there is more optimism of economic recovery when the economy re-opens,” said CREB® chief economist Ann-Marie Lurie.

“However, the recent surge in home sales could be a result of potential buyers wanting to enter the market before any further changes occur in prices, interest rates and lending policy. This could erode some of their purchasing power.”

Recent price gains and tight market conditions have also encouraged many sellers to list their home this month. However, demand was strong enough to absorb the additional supply, ensuring the market continues to favour the seller.

With 4,670 new listings coming onto the market in April, inventory levels trended up relative to last month and last year. With the elevated sales, the months of supply remains below two months.

Persistently tight market conditions are causing significant upward pressure on prices. For the second consecutive month, the unadjusted benchmark price rose by more than two percent compared with the previous month and more than nine per cent compared with last year’s levels.

While sales improved across most price ranges, product priced above $600,000 represented 25 percent of the sales that occurred this month. This is a significant increase from last year when they only represented 12 per cent of sales. The shift in distribution is causing both the average and median prices to record double-digit year-over-year price gains.

View the full report here: April 2021 Monthly Statistics Report

Calgary housing market sees best March sales in over a decade

City of Calgary, April 2021

The initial impact of COVID-19 on the housing market began last March. One year later, it is not a surprise that March sales in 2021 were higher than in 2020. However, at 2,903 sales, this was the highest March total since 2007.

“Low lending rates and improved savings have supported sales activity,” said CREB® chief economist Ann-Marie Lurie. “However, sales have been somewhat restricted by the lack of listings. This month there was a jump in new listings, contributing to the strong monthly sales.”

Inventory levels pushed above 5,400 units, but citywide months of supply fell below two months. This reflects the lowest months of supply for March since 2014 and these tight conditions have contributed to price gains.

In March, the benchmark price trended up over last month to $441,900, over six per cent higher than last year’s levels. The price gains have moved the market closer to recovery, but prices remain over five per cent lower than 2014 highs.

“Improving prices will likely support further gains in new listings, as sellers try to capitalize on the recent shift toward rising prices,” said Lurie. “Eventually, this will help support more balanced conditions, but it could take time before we see this shift in the market.”

View the full report here: March 2021 Statistics Report

Coldwell Banker Complete Real Estate announces the release of “The Report,” A Comprehensive Profile of the 2021 Luxury Real Estate Market in Canada, the U.S. and Mexico

“The Report” includes input from various Canadian Coldwell Banker Global Luxury Specialists from Coast to Coast, including Calgary based luxury team; THE STARNES GROUP.

Calgary, Alberta (March 8, 2021) – Today, Coldwell Banker Complete Real Estate announces the release of “The Report: 2021 Global Luxury Market Insights,” an in-depth analysis of emerging luxury markets and buyers. This report was curated by Coldwell Banker Real Estate LLC, a Realogy (NYSE: RLGY) brand, and Coldwell Banker Global Luxury®

Susanita de Diego, Owner/Broker of Calgary, Alberta, Canada based, Coldwell Banker Complete Real Estate states, “This is an important publication for those invested in the North American luxury real estate market and includes across the board comparisons for the median sold prices, days on market, and list price to sale price ratios for the top 10% priced properties of key Canadian cities including Calgary”.

Included in the report are noteworthy trends shaped by an extraordinary year full of uncertainty and change, as well as top performing luxury markets of 2020 and those to watch in 2021.
This year, “The Report” combined sales data analysis with a record number of in-depth interviews from Coldwell Banker® Global Luxury® Property Specialists providing on-the-ground perspectives from diverse real estate markets. An entire section was dedicated to Mexico and Canada featuring Ottawa, Toronto, Vancouver, Halifax, and Calgary being noted as Canadian markets to watch in 2021.

Rachelle Starnes, President and CEO of luxury real estate specialists, THE STARNES GROUP, a part of the boutique Calgary brokerage Coldwell Banker Complete Real Estate, states “The pent-up demand for luxury homes over $1M is quickly emerging with sales in January and February of 2021 hitting 198 units sold (single family detached homes, CREB MLS® Reported Sales) in Calgary, Rocky View County and Foothills County. This sets a record for the last five years. The sales for the first two months of 2021 are up 128% over 2020 and 133% from 2019, for the same period.”

Starnes says “We should see an increase in prices with this excessive demand which has been fueled by the lowest uber luxury home prices we have seen in years. Resale prices are far below the cost to build and funds previously used for travel are now being invested in ‘staying at home.’ Because some mortgage interest rates have increased this week from 1.44% to 1.74%, prudent buyers will be pushing to get their interest rate locked in and purchase within the next 30 days.”

New definitions of luxury — like the intangibles of family, health, space and security — spurred new affluent living trends in 2020 as buyers realigned priorities by seeking out properties with access to the outdoors, privacy, and more space. Demand for mega mansions, estates and other luxury compounds surged, with 55% of Luxury Property Specialists surveyed that more square footage was the number one amenity that flipped in demand from 2019 to 2020. A new affluent demographic, known as Trailblazers, drove shifting buying trends as they migrated away from cities in favor of small, hidden gem towns, the suburbs, and second home destinations.

As wealthy homebuyers embraced new lifestyles, new trends prevailed. The top preferences expected to have staying power over the next 5 years include: the home office (27.5%), demand for a second home (22.5%), and the desire for single-family detached homes (22.5%).

In 2020, there was a dramatic change in many luxury markets that had been buyer’s or balanced markets in 2019. Escalating demand now pushed these markets into seller market territory, which is only anticipated to continue into 2021. To determine the Top 10 “Power Markets” of 2020, the Coldwell Banker® brand collaborated with The Institute for Luxury Home Marketing to analyze the markets with at least an average of 50 sales per month and the highest sales ratio percentages.

“The Report” also identified four key categories of emerging markets across the luxury home sector offering a range of lifestyle amenities, cultural experiences, and educational opportunities. The unexpected rise of these locations underscores the unforeseen dynamics at play during 2020 as the pandemic impacted many buyers’ decisions.

“Looking ahead, many positive economic indicators and demographic trends are becoming evident in 2021. Record levels of international migration, particularly to Vancouver and Toronto, are expected to impact the sales of luxury homes. Pent up demand and historically low inventory will continue to drive fierce competition for listings, with luxury properties in high demand.”

– Andy Puthon, President, Coldwell Banker Canada

“International buyers used to account for more than 30% of luxury home sales in our market but travel restrictions ended the influx in 2020. Properties in many luxury areas in and around Calgary which sold in 2012 for C$4M are now being offered for less than $2.5M and properties once offered at C$20M are being auctioned by luxury auction houses with sale prices less than C$6M. Because of the lowest luxury prices we have seen in recent history there are incredible opportunities in Alberta for luxury buyers. We predict even greater demand once the borders reopen and international buyers flood back into Alberta for its clean air and reputation as a destination of choice for luxury buyers”.

– Susanita de Diego & Rachelle Starnes with Coldwell Banker Complete Real Estate

Sellers’ market in February leads to rising prices

City of Calgary, March 2021

With gains in every price range, residential sales activity in February totaled 1,836. This reflects the best February since 2014.

“Despite continued COVID-19 restrictions, housing activity continues to improve. Much of the strong sales activity is expected to be driven by exceptionally low mortgage rates,” said CREB® chief economist Ann-Marie Lurie.

“Confidence is also likely improving as vaccine rollouts are underway. Additionally, some of the worst fears concerning the energy sector are easing with recent gains in energy prices.”

New listings also improved in February, but the gap between new listings and sales narrowed. This is causing the sales-to-new-listings ratio to rise to 65 percent, keeping the months of supply well below three months.

Conditions are far tighter in the detached sector of the market, especially for product priced below $600,000, where strong sellers’ market conditions are present with less than two months of supply.

The market has faced relatively low inventory levels compared to sales for the past several months and prices continue to trend up. In February, the residential benchmark price rose over the previous month and currently sits four per cent above last years’ levels.

Detached product has the lowest months of supply and is also exhibiting the most significant gains in prices. On the opposite end of the spectrum, the apartment condominium segment still has a relatively high level of inventory compared to sales, which is impacting price recovery for this property type.

View the full report here: February 2021 Report

On January 17, 2021 we received 7 offers on one of our listings that had been active for less than 48 hours!

As you can imagine, the seller was ecstatic. But you might be curious as to WHY we received so many offers?

The answer is because ALL OF THE ESSENTIAL components were there:

1. The property was properly prepared.

When we first viewed the property, it was still occupied and to understate the condition – it did not show well. The owners asked us if they needed to repair holes in the walls, paint and remove all of furniture and personal items from the home before they listed. We let them know that if the repairs were not made that the list price should not be more than $250,000. This was because the three most recent sales for similar sized homes which needed work sold for $225,000, $227,000 and $242,000. The sellers decided to undertake the work – which was significant.

2. Market conditions were reviewed on the listing day.

Some time had passed between our first viewing and the list date. In the meantime, the sellers removed all of the items from the home, repaired the holes in the walls, painted and cleaned. Market conditions had also changed. Although there were no new sales the listing inventory had come down and there was very little competition in the price range and area for a detached home. Because the subject property had a garage and the recent sales did not the owners decided to list the house for $265,000.00.

3. The home was well marketed.

Before activating the MLS® listing we had the property professionally photographed and measured, we determined who the target market would be and we created the listing copy to reflect the target market. We knew there would be lots of activity and boy was there! We had twelve showings in the first two days!

4. All interested parties were kept informed of the competition.

We eventually received seven – that’s right – seven offers! We kept each interested party informed of the number of offers including the REALTORS® who were requesting showings, thereby creating excitement and further demand. All those submitting offers were advised to submit their best offers because of the number of offers received.

5. The offer review, offer acceptance and counter-offer processes were conducted in line with industry protocols and the sellers’ legal rights.

We reviewed each offer with the sellers using a table to allow the sellers to easily sort the offers by superiority. The terms we reviewed were: Purchase price, deposit amount, closing day, conditions and the condition removal date. If an offer contained a financing condition, we reviewed the percentage of purchase price which would be financed as well as any other terms affecting the sellers’ position. In a perfect world there would be a clear winner with the highest price and zero conditions but that is not always the case. Three of the offers were for substantially less than list price. The sellers chose to accept the highest offer which contained one condition and made a counter-offer of price to a second buyer and to counter the offer in back-up position only. This second offer also had one condition. Because both owners were in assisted-living we emailed the two parties the intentions of the owners and informed them that signatures would be obtained the next day. In the meantime, the buyer from the second offer decided to increase their offer and remove their condition which made this offer the most attractive to the sellers. The buyer from the first offer was invited to change their offer but they did not.

What was the final outcome? A sale price of $290,000.00 and peace of mind for the sellers in knowing that the home was sold firm with no conditions.

Questions? If you would like to chat about multiple offer processes or about current market conditions, we would be happy to hear from you!

You can Contact Coldwell Banker Complete Real Estate online, call us at 403-686-1455 or book an online appointment.

Welcome to the first edition of TRANSITIONS Magazine!

Our online magazine will be published 4 times per year, with each edition featuring special interest topics we hope you will enjoy.

For our Winter 2021 publication, we have lots of articles for you!

You can click the image below to scroll though the PDF version, or click on some of the highlights we have linked below.

Featured Articles:

Decorating a Tween’s Bedroom

Find and Create Your Perfect Home Office Space

January sales signal strong start to 2021 – January 2021 Real Estate Statistics Report

Video – Meet Susanita de Diego

Watch for our Spring/Summer editions to be released in the next few months!

If you or someone you know has any real estate questions, we’d love to help!

Contact us here: https://www.cbcompleterealestate.com/contact

OR

Phone: 403-686-1455

Email: info@cbcalgary.ca

Thanks for reading!

January sales signal strong start to 2021

City of Calgary, February 2021

Amidst economic challenges, housing market ends 2020 on a high note

City of Calgary, January 2021

With December sales of 1,199, this is the highest December total since 2007.

Sales activity remains strong in November

City of Calgary, December 2020

View the full report here:November 2020 Statistics Report