Calgary, AB – Driven by gains across most of the larger centres in the province, except for Edmonton, year-over-year residential sales activity improved by over five per cent in January.
There were a lot of concerns weighing on consumers at the beginning of last year, impacting the resale housing market. The economic situation has not changed significantly over the past year, but some of the concerns have eased and modest improvements in the fundamentals supporting the housing market have occurred.
“Despite modest gains, it is important to note that conditions have shifted in the past five years and since the energy sector adjustment, we are left with a housing market that has slower levels of demand, higher amounts of inventory, and prices that remain lower than 2014 highs,” says Ann-Marie Lurie, AREA Chief Economist.
January average prices did improve compared to last year, but much of the gains are expected to be due to distributional shifts. Most regions reported improving sales in the higher end of the market, pulling up average prices. However, the large markets of Calgary and Edmonton reported easing in benchmark prices, which is consistent with expectations given the current levels of oversupply in their respective markets.
Calgary RegionHousing market conditions continue to follow similar trends to last year. January sales activity improved by nearly 12 per cent, while new listings fell by nearly eight per cent. This contributed to a decline in inventory levels and caused the months of supply to fall to just over six months, a significant improvement from last year’s levels of nearly eight months.
While conditions are improving, the housing market continues to favour the buyer, causing further price declines. However, as conditions start to adjust to a new normal, the pace of price decline is starting to ease.Edmonton RegionJanuary sales eased slightly compared to last year’s level. Thanks to a significant decline in new listings, inventory levels eased, and the market saw the months of supply ease to under nine months, improvement from last January levels which were nearly 10 months.
While the market remains oversupplied, both the average and median prices improved over the previous year, while the benchmark price eased. The improvements in average and median prices were likely driven by a shift in the distribution this month compared to last year as there was a jump in the number of higher priced home sales.
Central AlbertaJanuary sales improved compared to the weak levels recorded last year. Despite the gain, levels remain well below longer term averages. Improving sales were met with declines in new listings and ultimately inventory levels. This helped reduce the amount of oversupply in the market.
Meanwhile prices did improve over the previous year. However, the improvements were likely related to a distribution shift where there was a notable rise in higher priced home sales.
Fort McMurrayWhile challenges in the energy sector persist, 2020 expectations are far more optimistic than what residents were facing at the start of last year. This is somewhat reflected through the improvement in January sales. While levels remain well below historical trends, the improvements helped reduce inventory levels and brought down the months of supply.
January prices improved compared to the previous year. Sales activity was much stronger this year from homes priced between $400,000 – $650,000, compared to last year.
Grande PrairieJanuary sales activity remained relatively stable compared to last year. However, a rise in new listings was enough to cause inventory gains and push up the months of supply to levels comparable to 2016.
Median prices remained just slightly higher than last year’s levels while average prices recorded a strong gain likely caused by some higher priced home sales. The price fluctuations can be significant on a monthly basis, but the general trend has pointed toward price stability.
LethbridgeJanuary sales activity rose to 137 units, making it the strongest January sales over the past decade. While new listings and inventory also rose in January compared to last year, the growth in sales offset the supply gains, causing the months of supply to ease bringing it closer to balanced conditions.
Improvements in the sales relative to supply have supported relatively stable prices over the past several months. However, prices in January remain just slightly lower than last year’s levels, in part due to improved sales activity in the lower end of the market.
Medicine HatRising supply due to gains in new listings continued in January. However, higher sales activity helped offset the impact causing the months of supply to ease slightly over last year’s levels and remain just above longer-term trends.
While monthly prices have been relatively volatile, overall trends continue to point to general stability. However, activity does vary by price range as most of the gains in sales this month occurred for homes priced between $300,000 – $400,000.
Alberta WestEconomic conditions in the region vary significantly. As the housing statistics are compiled for the entire region, figures may not accurately reflect conditions in the local market.
Slower sales in January were met with gains in new listings causing a rise in inventory and a jump in the months of supply. Meanwhile, median prices remained just below last year’s levels while average prices rose mostly due to increases occurring in the lowest price range which reflects over 35 per cent of the sales activity in the region.
LloydminsterSales activity in the region were similar to last year’s levels, but with no change in the number of new listings coming onto the market, inventory levels rose pushing up the months of supply. Persistent buyer’s market conditions continue to weigh on prices which have generally been trending down. While the average price did increase this month compared to last January, this is due to some higher priced sales that occurred this year.
South Central AlbertaBoth sales activity and inventory levels remained comparable to activity recorded last January. However, a larger number of sales occurred in some of the higher price ranges causing prices to improve compared to last year.
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