Sales activity improves for second consecutive month
City of Calgary, June 2019
Sales growth in May was met with a decline in new listings. This combination eased the pressure on inventory levels, which finished the month at 7,467 units, a decline of 12 percent compared to last year.
Improving sales relative to inventory levels caused the months of supply to ease to just under four months. While still oversupplied, this is an improvement from the five months of supply recorded last May. Citywide sales in May totaled 1,921 units, 11 percent higher than last year’s levels. However, sales remain 10 percent below longer-term trends. This sales growth was primarily driven by homes prices under $500,000.
Citywide benchmark prices totaled $424,600 in May. Prices have shown some signs of improvement month-over-month, but remain four percent lower than 2018 levels.
“While sales activity remains low based on historical activity for May, the easing prices have brought some people back to market, while also preventing some others from listing their homes,” said CREB® chief economist Ann-Marie Lurie. “This has started to push the market towards more balanced conditions. If this trend continues, it could limit some of the downward pressure on prices.”
Housing Market Facts
Detached
- Detached sales in May totaled 1,182 units. This is a 12 percent increase over last year, but still 13 percent below long-term averages. The improvement in sales was driven primarily by gains in homes priced under $500,000.
- Sales activity increased across most districts in May. However, year-to-date sales have only increased in the East, South and North East districts of the city. Citywide sales remain one percent lower than last year’s levels.
- New listings in May pulled back significantly from previous year’s levels. Combined with an improvement in sales, this resulted in inventories declining from 4,504 units last May to 3,921 units this month. This is the first time since. May 2017 that year-over-year inventories declined.
- Easing inventory and improving sales caused months of supply to ease to 3.3 months. This is still elevated compared to historical levels but represents an improvement compared to levels from the past year.
- Prices have remained relatively stable over the past few months, with some modest monthly improvements. However, the oversupply scenario has left prices four percent lower than last year and seven percent lower than 2014 highs.
Apartment
- May benchmark prices totaled $248,200, 0.6 percent lower than last month and nearly three percent lower than last year’s levels. This is resulting in a total price adjustment of over 17 percent since 2014.
- The improvement in monthly sales was not enough to offset previous declines. Year-to-date apartment sales sit at 1,030 units. This is seven percent lower than last year and 28 percent lower than longer-term averages. Easing sales were met with fewer new listings, reducing the market inventory. This pushed months of supply to just over five months.
- If the reduction in oversupply continues, it will eventually help limit price declines. However, this market remains oversupplied and prices continue to edge down.
Attached
- Attached sales activity continue to improve in May. Year-to-date sales improved by two percent, making this the only sector to record a year-to-date improvement. Improvements occurred throughout most districts of the city, apart from the City Centre, North West, and West districts.
- New listings have also pulled back relative to sales. This is causing inventories to ease compared to last year and months of supply to trend down.
- Benchmark prices remain five percent lower than last year’s levels but have seen some modest gains on a month-to-month basis. Despite some signs of improvement, prices remain 10 percent lower than 2014 highs.
For anyone who is interested in buying or selling during this interesting market period, we would love to help!
