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Posts Tagged ‘Alberta Real Estate Market’

YEG-Real Estate Market Reports-January-2018

Tuesday, January 23rd, 2018

Dear Friends,

I hope you are feeling refreshed, revived and ready to face 2018.  January is full of resolutions and promises but don’t be too hard on yourself.  Make time to pamper yourself between all the commitments.  This month there are some tricks for creating the perfect relaxation space right at home. Should you wish to get out of the house, look no further than our list of events happening around Edmonton this month.  To keep you up to date in the world of Real Estate, included are the latest market reports to make sure you didn’t miss anything during the holiday crunch.

And now for this months report:

YEG-Real Estate Market Reports-January-2018

YEG-Real Estate Market Reports-January-2018

 

Inventory: December finished with another full inventory and buyers market month here in Edmonton with 6.30 months of inventory for active buyers to choose from.

Total number of homes available to buy in the Greater Edmonton area: 5,736

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Caution: Selling in Winter can be tricky, YEG!

Friday, December 29th, 2017
YEG-Real Estate Market Reports-December 2017

YEG-Real Estate Market Reports-December 2017

Hi Folks,

The holiday season is upon us with lots of cheer and time with loved ones to brighten up the winter time. December always seems to be such a busy time for having guests over and sometimes those visits can lead to a lot of stress. We are pleased to keep you updated on the latest real estate trends and market reports as well as activities for your visiting guests. From entertaining your guests to finding your dream home, it’s my pleasure to help you. Please keep in touch.

With the onset of the winter season, we start to see the seasonal drop off of listings and sales…

Inventory: November finished with another full inventory month here in Edmonton with 6.02 months of inventory for active buyers to choose from.

Total number of homes available to buy in the Greater Edmonton area: 7,030.

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2018 RE/MAX Housing Market Outlook for Canada

Thursday, December 28th, 2017


Summary:
*48% of potential homebuyers plan to purchase in the next 5 years
*Condo demand and prices spikes in Greater Toronto and Vancouver in 2017 while single family home sales and prices dropped in both of these markets
*More lateral move buyers left large urban centers in favour of lower prices and more amenities resulting in substantial price growth particularly outside of Toronto and Vancouver
*Edmonton and Calgary saw stabilizing oil prices boost housing demand and prices

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Alberta Real Estate Market Reports – January 2017 Edition

Wednesday, January 25th, 2017

Click here for the full monthly report, including additional details on the outlook for Alberta’s housing market in 2017.

I. Alberta MLS® Trends

A total of 2,612 Alberta residential unit sales were recorded through the MLS® Systems of real estate Boards/Associations in December, rising 3.2 per cent from the same month last year. The average MLS® residential price in Alberta rose to $395,694, an increase of 1.6 per cent from December 2015.

Only the Calgary Real Estate Board saw an increase in monthly residential average prices from year-ago levels, while the remaining nine Boards/Associations saw decreases of varying degrees (see chart below for detailed information).

The value of all home sales in the province totalled $1.03 billion in December, rising 4.8 per cent from last year. New listings numbered 3,568 units for the month, a decrease of 21.7 per cent from a year earlier, while active residential listings numbered 20,244 units, up 0.9 per cent from one year ago. There were 7.8 months of inventory at the end of the month, little changed from 7.9 months in December 2015.

II. Alberta Sales Outlook for 2017

Read more of the Alberta sales outlook for 2017 in the full report.

Summary

In Alberta, movements in residential sales over the past 20 years have been driven primarily by changes in house prices and in mortgage payments (income channel). As shown in Table 1, over the 1997-2016 period, house prices have risen two times faster than residential sales in Alberta. The average price growth for that period was 6.55 per cent compared with average sales growth of three per cent (averages of monthly values). Looking at the simultaneous growth in these two, we can estimate the change in sales with regard to changes in house prices. This is done by dividing the year-over-year change in sales by the year-over-year change in prices. The result is shown in column 6 of Table 1 and represents the price-elasticity of demand.

In Alberta, on average this price-elasticity has been positive and hovered around 6.8 over the past 20 years. What that means is, for every one per cent increase in house prices, sales increased by roughly seven per cent. This might look counter-intuitive because classical demand analysis expects a negative relation between a product price and demand for the product. But, as an investment good, higher home prices mean higher returns on housing investment. Rising house prices may prompt more home sales thus leading to a positive co-movement between sales and prices. Indeed, houses are not only consumption goods, but also assets. Homebuyers buy houses both as consumers and investors. Case and Shiller (1998) for instance, based on a survey, reports that 44 to 64 per cent of homebuyers considered the purchase of a house as an investment.  In Chart 1, the correlation between sales growth (green line) and price growth (red line) is almost perfect: the two mirror each other, displaying a positive co-movement.

Outlook for 2017

We expect residential sales in Alberta to decline by roughly 2.38 per cent in 2017: to 50,927 transactions in 2017 from 52,169 transactions in 2016. This is based on two factors: the price depreciation expected for 2017, and the price-elasticity of sales over the last 20 years. Currently, we expect to see a 0.35 per cent price decline in 2017 (read more about this in the full report). Given the strong response of sales following changes in prices, we added to the picture the weight of a price-elasticity of 6.8 (1997-2016 average).  If we were to consider most recent price-elasticities of sales, like those seen over the last five years (value for the 2012-2016 period in table 1), we could easily be looking at a 6.8 per cent reduction in residential sales in 2017 (table 1). What that means is that only 48,621 existing homes would change hands in Alberta in 2017, compared with 52,169 in 2016.

III. Economic Drivers of Alberta House Prices
IV. The Price-Rent Ratio, Over-Under Valuation and Price Outlook for 2017

Read more in the full report

V. Board/Association Statistics

VI. Alberta Charts

Residential Sales – Current levels are comparable to the years 2010-2012, but remain down from the historical highs in 2013 and 2014.

Residential Average Price – The current residential price for Alberta remains in line with those since 2013, while increasing slightly in December 2016 from one year ago.

Month-over-Month Average Price – Month-to-month average prices have remained fairly consistent in 2016, with the exception of January, typically the lowest volume month with the lowest sale price.

Residential Dollar Volume – Similar to sales numbers, the total dollar volume of sales in Alberta is comparable to the 2010-2012 timeframe, well below the historical highs in 2013 and 2014.

Months of Inventory – Months of inventory were relatively unchanged in December when compared to the same month one year ago. The annual trend follows historical value, with months of inventory rising in the traditionally slower fall and winter months, before decreasing again in the busier spring and summer timeframe.

Note: The data in the charts is national data and may not perfectly reflect the data reported by a Board/Association. The data includes all activity recorded for a board’s area, e.g. Calgary includes all sales recorded by CREB®, not just the Calgary metropolitan area. For more specific information, please contact your local board/association. Click here for a guideline of Board/Association boundaries

The Alberta Real Estate Association (AREA) compiles provincial MLS® sales data for dissemination to REALTORS® and other interested groups. The data that is provided represents statistics provided to AREA by way of the Canadian Real Estate Association (CREA). For more detailed statistical information for Boards/Associations or for individual areas, contact your local real estate Board/Association or your local REALTOR®.

The Alberta Real Estate Association (AREA) represents more than 10,000 REALTORS® and 10 real estate Boards/Associations province-wide. AREA’s vision is to provide world-class leadership that positively shapes the Alberta real estate profession, enhances member professionalism, and reinforces the critical value REALTORS® deliver to both buyers and sellers.

For more information, please contact AREA Communications at communications@areahub.ca or by phone at 1.800.661.0231.

Alberta Real Estate Association
Suite 300, 4954 Richard Road SW
Calgary, AB T3E 6L1
communications@areahub.ca
www.areahub.ca

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Will the Foreign Investor Tax Help You Buy Property?

Wednesday, November 23rd, 2016

If you’ve been watching the headlines, you’ll know that there is a lot of frustration with regards to two large Real Estate Markets in Canada.  One is Vancouver and the other is Toronto.  Recently the BC Government introduced a 15% Foreign Investor tax on property purchasers in B.C.  Christy Clark can be heard saying ‘that is the impact we wanted to have.’  To cool their Red Hot real estate market and that’s just what they did. According to data released by the B.C. government, billions of dollars in Metro Vancouver real estate deals dried up and almost overnight.

In fact, on the last day before the changes came into effect, 55% of all purchases were done so by foreign investors.  Probably some good, but most likely moreso just more buyers to add frustration into an already highly overinflated market area, where the regular Canadian cannot afford to buy a home. Instead, these homes sit vacant and derelict, causing rental and property prices to rise. It’s great what B.C. did, but did you know that China took action against B.C. and their politics first?  That’s right, China said they were going to come to Canada and sue to get their money back.  It is unprecedented and has been put forth to show an example to their own citizens.

The Chinese plaintiffs are asking B.C. judges to enforce monetary judgments awarded in Chinese courts. These Chinese rulings typically involve people found in China to have defrauded Chinese banks or business partners and then fled to Canada with the money and invested in real estate here. Billions of dollars of bank faud proceeds are alleged to be invested in BC, while Lawyers in Vancouver say they are seeing a substantial increase in B.C. court cases filed by Chinese companies seeking to seize real estate assets from Chinese immigrants in B.C.

Perhaps B.C. didn’t want all the attention they were getting, as they decided to help China and Canadians out by adding another tax to your total when buying in B.C.  The Greater Vancouver Real Estate Board revealed the number of homes being sold had dropped significantly and prices had stalled since it came into effect.  See below:

In the end, China coming in to sue for recovery of money will show some foreign investors that if they would like to own property in Canada, they should do it with their own money.  A wee ocean isn’t that much to cross to get back a few million.  The changes to mortgage loan values, as well as the vacancy tax starting in January for Vancouver, all help Canadians such as you and I buy and keep our properties.  Canadians who had to work for their millions and mansions. Right on China, Right on B.C.

Now that’s the Cats’ Meow in Real Estate.

Canada Housing Market Confidence

Tuesday, September 16th, 2014

Canadian Housing Market Confidence

RBC recently finished their long running Annual Home Ownership Poll in Canada. Poll and year number 21, to be exact. The news and outlook of entry buyers is encouraging – especially after witnessing how recent financial legistlations have left buyers positioned in our fastest growing economy of Edmonton. Here are some of the interesting points to note:

Young Canadians, aged 25 – 34, feel that housing remains a very good investment. Nearly nine in ten (86 per cent) of them believe that owning a house or condo is a very good investment, up from less than eight in ten (78 per cent) in 2013.

This confidence in the housing market is reflected in Canadians’ buying intentions. Nearly every region in Canada has shown an increase in their likelihood to purchase over the last year. The top factors considered by those who intend to buy this year include the stability of their job situation and manageable debt levels. Confidence in these areas indicates that Canadians are more mindful of their finances than in 2013, which directly impacts the ability to afford home ownership.

In particular, interest in purchasing from the 25-34 age group has increased significantly from one in four (25 per cent) in 2013 to nearly half (41 per cent) of respondents in 2014.

Also notable in the same poll results, is Canadians’ willingness to go it alone when it comes to home buying. Granted, the majority of Canadians (62 per cent) still intend to buy a home with their spouse or partner, but now more than one in four (28 per cent) Canadians intend to buy a home by themselves.

Alberta Highlights: Alberta saw an increase in likelihood of purchasing this year, up from 22 per cent in 2013 to 28 per cent in 2014. Perceived home price increases may also be key for Albertans, as more than half (52 per cent) believe that home prices will continue to rise next year.

British Columbia Highlights – In B.C., the percentage of those who are likely to buy a home has increased slightly, from one-in-five (20 per cent) in 2013 to more than one-in-five (22 per cent) in 2014. With four-in-ten (41 per cent) believing that housing prices will continue to rise next year, it signals that British Columbians want to get in while they feel they can and reinforces the positive investment sentiment.