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2012 Regional Market Housing Statistics for Calgary

Saturday, February 16th, 2013

2012 Regional Market Housing Statistics for Calgary

Calgary is one of the most economically sound cities in Canada and, as such, it has consistently
produced steady growth in the housing Calgary real estate market. Of course, there are always going to be ups and
downs in any housing market, but, if recent trends are any indicator, Calgary shows good signs
of remaining one of the most solid real estate markets in the nation. Indeed, 2012 saw some of
the best statistics in relation to real estate that Calgary has experienced in quite some time. Many
of those in the market either trying to buy or sell a home will want to know exactly what this
means for them.

The 2012 calendar year saw an increase in housing sales of 15% compared to the previous year
for Calgary. This was certainly a cause for cautious optimism when it comes to the 2013 housing
market. This increase in sales buoyed the housing sector in Calgary and increased benchmark
prices by 5%. The market hasn’t seen these kinds of numbers since the peak in 2007. Of course,
the 2012 statistics don’t quite measure up to the 2007 levels, but it is certainly a move in the right
direction. When more houses are being purchased it means that economic growth is increasing in
the city—a fact that is good for all concerned parties.

But, the uptick in sales didn’t necessarily bode well for everyone in the housing market. Single-
family Calgary homes sold in substantially higher numbers than expected. In fact, single-family home
sales occurred more frequently than new single-family home listings. Thus, the supply quickly
started to diminish especially toward the end of the year. Demand stayed roughly the same
despite the decrease in supply, and this, of course, forced prices to rise in some areas. Indeed,
the benchmark price for single-family homes in Calgary was just short of $435,000 (up about
7% from the previous year). Even so, this shouldn’t be read as a discouraging sign for potential
buyers. There are still many communities within Calgary that are maintaining average prices
rather than experiencing increases.

Because of the decrease in the supply of single-family homes, the demand for condominiums
rose toward the end of the year. Both condominium apartments and condominium townhouses
saw sales increases of 12% and 16% respectively over the previous year. The benchmark prices
topped out at just under $250,000 for condos in Calgary in December. This was an increase of
5.4% over the previous year. Annual sales only saw a net increase of around 2% in benchmark
prices. Despite the greater sales, this number was slightly disappointing, especially for owners
trying to sell their units.

Regardless, the difference in benchmark prices and average prices for condos might be a little
bit skewed. Indeed, some of the numbers were inflated by a few multi-million dollar condos
being sold in 2012. While it might look like the average prices are due for a large drop, they
are actually expected to ease over time in 2013. This is because there will likely be fewer
multi-million dollar condo purchases in this calendar year. Overall, this is a marked difference
between many other regional markets throughout the nation. Price growth is expected to slide
substantially in other markets, giving Calgary a definitive edge for sellers.

All of these statistics beg the question of whether or not Calgary is a buyer’s or a seller’s market.
There are some indicators that seem to lean toward a buyer’s market and some that seem to lean
toward a seller’s market. In reality, Calgary offers the best of both worlds: a balanced market.
This effectively means that both buyers and sellers will be able to find something positive with

the housing market in Calgary. Interest rates are relatively low as per the mandate set by the
United States Federal Reserve, but prices seem to be on the rise, if only slightly. In effect, sellers
are getting slightly more money for their houses while buyers are having to pay slightly less on
their mortgages.

2012 also saw a shifting trend in that more people were willing to pay higher prices for housing
than in previous years. In fact, Calgary saw an increase in housing sales of $500,000 or more
compared to any of the previous three years. There were also slightly fewer sales in 2012 for
any housing priced at or below $500,000. This, of course, reflects the decreased supply of and
increased demand for single-family homes and the subsequent price increase caused by that.
But it also shows that people are more willing to pay extra now than they would have been in
previous years.

The ability to pay these prices is likely just as important as the prices themselves. If the 2012
housing market in Calgary is any indication, the overall stability and prospect of growth in the
economy is certainly promising. Perhaps the only distressing factor for some prospective buyers
is the diminishing inventory of virtually all units (including single-family homes and condos).
With migration and economic growth seeing resurgences, the demand for high-quality housing is
rising exponentially, particularly within the City of Calgary itself.

In large part, however, you’re going to see more supply of every type of housing unit in the
surrounding towns. If the housing market in 2012 has taught us anything, it’s that Calgary itself
is being saturated with new people, but not a lot of places for them to live. Thus, you may start
seeing certain residents branch out to periphery towns. This is as much about availability as it is
price. Most of the homes purchased in surrounding towns in the metro area were in the $200,000
to $300,000 range. For many individuals, this price decrease might be seen as beneficial, even if
it means losing proximity to the Downtown area of Calgary.

All in all, 2012 brought with it a lot of optimism in light of the global economic downturn in
recent years. The increases in housing sales, price growth, and other indicators have certainly
helped ease the minds of many residents of Calgary. Indeed, 2012 marked the end of 4 years of
market futility and weak growth. Calgary finally started to recover from the slump of years past
and it showed up big in the numbers. A lot of the sales growth can be attributed, to some degree,
to the expanding energy sector. The increase in crude oil production and sales has translated to
a much more fluid housing market overall. Of course, any discussion of the energy sector must
also note that the production and sale of natural gas has seen a decline in recent years. Even so, it
hasn’t been enough to hurt the surging oil business in Alberta.

Armed with this information, you can certainly see that buying or selling a home in Calgary
might be the right decision for you in 2013. Although the market favors neither buyers nor
sellers, it does offer a balance that can be beneficial for both parties. For buyers, the market
appears to be capable of slipping one way or the other. That is, demand can remain the same and
supply could continue to diminish. That’s why buying now might make sense for you to avoid
any increases in price. By contrast, it might be the right time for sellers as the demand might
decrease, which would level off the prices. In any event, it’s important to talk with your realtor to
get the best idea of how the 2012 statistics inform any 2013 forecasts.

Outlook for the 2013 Calgary Housing Market

Saturday, February 16th, 2013

As with any new year, 2013 brings with it a wide array of new opportunities. Although we

are almost a full month into the calendar year, the remaining 11 months are a blank slate full
of possibility and uncertainty. Many individuals count the New Year as a way to reinvigorate
themselves. For many residents of Calgary, that might include the prospect of buying a new
home. Indeed, each New Year is full of surprises and new ventures, and it might be time to give
home ownership a try. It certainly won’t be an easy process, but, at the end of the day, owning
your own home is something you can take pride in for years to come.

But, the onset of the New Year is naturally going to bring about a few housing market forecasts
that can help you determine whether or not you really want to buy a house. One of the major
issues facing Calgary, the nation, and the world in general is the global economic downturn that
has produced various risks for any long-term investors. Buying a house, of course, is a very
long-term investment, and there’s going to be some natural trepidation no matter where you’re
looking to relocate. Just a quick glance at the global unemployment levels, lack of growth, and
the recent bursting of the U.S. housing bubble is enough to make anyone wary of investing in
real estate.

Indeed, Canada is often beholden to certain policies enacted by our neighbors to the south.
Perhaps the most obvious requirement set by the U.S. Federal Reserve is the relatively low
interest rate policy in effect until 2015. This certainly helps spur the growth of the housing
market as more consumers are willing to buy when the rates are low. Even so, the specter of a
housing collapse not unlike the one experienced recently in the United States is enough to make
money potential first-time buyers second guess their decision.

In fact, the Canadian housing market for 2013 was said to be at risk as a result of numerous
factors. Several studies have indicated that the housing market is due for a “correction” that
might bring about similar conditions to those found in the United States in recent years. The
highest risk was found in the two top markets of Toronto and Vancouver, but the effects could
filter out to other locales as well. Regardless, the studies fell short of claiming that the housing
correction would result in any kind of crash. This is largely because the risk of Canada’s debt is
far less dire than that of the United States.

Outside of the two major markets in Canada, there are certainly locations that will be relatively
insulated from any problems on the housing market. Resource-rich provinces like Alberta
and Saskatchewan will be able to buoy themselves based on high economic growth. This will
naturally lend itself to higher instances of home ownership because the market is much more
stable there than in other locations. Alberta tends to lead the nation when it comes to GDP
growth, and that’s largely a result of their energy sector. They are Canada’s leading exporter of
crude oil, and they certainly help maintain an even standard of economic stability.

The City of Calgary itself has also seen growth in recent years. In 2011, it topped 5% GDP
growth in production sectors like agriculture, mining, and oil and gas extraction. Heading into
2012, the growth evened out a bit, but Calgary’s overall economic prospects were still bright.
Indeed, the projections for 2013 indicate that Calgary’s GDP will grow by 3.3% over the next
year. Employment figures are also looking toward an increase for the upcoming calendar year.
This is a large reason why Calgary residents saw an additional 19,000 migrants added to their

ranks in 2012. Job prospects are much higher in Calgary than they are in many other locales
around the nation.

Of course, all of these economic growth factors and the subsequent influx of migrants have led
to a natural increase in demand for housing. Much of this demand manifests itself in the form of
rental properties. The increased migrant population has overwhelmingly opted for rentals as a
way to ensure a quick and easy living situation. This demand has caused the apartment vacancy
rate to dip down from 3.3% to 1.3%. In 2013, the migration patterns and demand for rentals are
projected to keep the vacancy rates at or below 1.5%. Naturally, the rental rates are going to also
see an increase as the supply of rental spaces diminishes and the demand only gets larger.

Most experts suggest that the rising costs of rental properties will spur a new demand for
those looking to buy a home in Calgary. Indeed, the amount of housing starts has increased
substantially since 2009, but has largely shifted to the construction of multi-family residences.
That means, you’re likely going to see a lot more new condominiums than you are single-family
homes. Even so, trends show that the gap between the construction of multi-family complexes
and the construction of single-family homes is starting to close.

The act of buying and selling single-family homes has seen a great deal of fluctuation in recent
years. 2012 saw an increase in sales for single-family homes despite having fewer listings
overall. This, of course, brought about an uptick in price, making it an ideal time for sellers.
The average price for a single-family home in Calgary was just under $425,000. If projections
remain steady, the availability of houses and their prices will not see significant fluctuations for
2013. The average price for a single-family home in 2013 should only be around $437,000. This
ensures that sellers will still get adequate prices, and buyers will not have to endure any major
increases in price.

Demand for condominiums also saw an increase in 2012, which naturally increased the price
for buying one of these spaces. More people started looking toward condos as their key to
the world of home ownership after the supply of single-family homes started to dwindle in
the second half of 2012. For 2013, the supply of condominiums is only expected to increase
as both single-family homes and rental spaces provide limited options. Several new units are
set to be completed in 2013, which is a reality that makes condominiums seem more enticing.
With average prices ranging from $240,000 to $280,000, it’s easy to see why many people are
flocking to these multi-family units in Calgary.

At the end of the day, there are many different factors that contribute to the overall feasibility
of buying a home this year. Economic factors are certainly major components of ensuring a
successful housing market. But, it’s important to not let any one factor determine exactly what
your course of action is going to be. If you want to buy a single-family home in 2013, all the
trends suggest that you might be looking at a difficult process. Even so, there’s always a chance
that you might end up being one of the lucky buyers in 2013 who finds the right house at the
right price. You should never let trends dissuade you from trying to get what you want, and,
when it comes to real estate, a realtor can certainly help you make the right choice in any kind of
economic climate.

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The trademarks MLS®, Multiple Listing Service® and the associated logos are owned by The Canadian Real Estate Association (CREA) and identify the quality of services provided by real estate professionals who are members of CREA. Used under license.

The trademarks REALTOR®, REALTORS® and the REALTOR® logo are controlled by The Canadian Real Estate Association (CREA) and identify real estate professionals who are members of CREA. Used under license. REALTOR® logo are controlled by The Canadian Real Estate Association (CREA) and identify real estate professionals who are members of CREA. Used under license.