Demand for homes remains high with record sales in April
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 per cent 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 per cent 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.
HOUSING MARKET FACTS
Detached homes hit a new record high for the month with 2,046 sales in April.
Gains in new listings helped support stronger sales, but they did little to ease the persistent sellers’ market conditions. The months of supply remained well below two months in this segment, which is contributing to a steady climb in prices.
As of April, the benchmark price rose to $529,100. This is nearly 11 per cent higher than last year and more than $30,000 higher than levels recorded at the start of 2021. The recent gains were enough to push the benchmark price to a new high, reflecting full price recovery from 2014 levels.
Strong price gains occurred across most districts in the city thanks to persistently tight conditions. However, the pace of price adjustments did vary depending on location. The City Centre district has seen the slowest rebound and prices remain nearly seven per cent below previous highs.
Following several months of strong sales, year-to-date sales reached record highs in April with 888 sales.
This is the only property type to reach record highs based on year-to-date figures. Gains occurred across every district and price range. Like the other sectors, gains in new listings were not enough to move the market out of sellers’ conditions, as the months of supply remained below two months.
The tight market conditions supported price growth across all districts, with the strongest year-over-year gains occurring in the North, North West, and South East districts. In April, year-over-year price gains in these districts were above 12 per cent, which was enough to support new monthly record-high prices.
After the first four months of the year, row sales totalled 1,217 units. This the best start to the year since 2007, and well above long-term averages.
New listings in this sector have also been on the rise, causing inventories to trend up. Supply has risen above levels recorded last April, but strong sales compared to inventory levels have caused the months of supply to remain just above two months. This is significantly lower than the longer-term average, which is closer to four months.
While these conditions have only persisted over the past three months, prices have been slower to climb. As of April, row benchmark prices climbed to $293,400. Prices have been trending up across all districts of the city, but they remain well below previous highs.
Further improvements in April resulted in 1,280 year-to-date sales in this sector, which is the strongest sales seen over the past six years.
New listings also remained high compared to typical levels and inventories continued to rise. There was more inventory in the market, but the improvement in sales did cause further reductions in the months of supply.
In April, the months of supply was just over four months. This is fairly consistent with longer-term trends and reflects the most balanced conditions seen for some time. With less oversupply in the market, prices have been trending up and in April the benchmark price was $251,900. This is more than three per cent higher than last year.
Price improvements did vary by location and it will take some time for prices to recover to previous highs.
For example, there was a two per cent year-over-year increase in the City Centre, where most of the condo sales occur, but prices remain nearly 17 per cent lower than previous highs.
REGIONAL MARKET FACTS
Sales activity remained strong in April, as purchasers took advantage of the gains in new listings this month. The recent rise in new listings has caused inventories to increase relative to the past several months, but it did little to ease the sellers’ market conditions that have existed since last year.
Persistent sellers’ market conditions placed upward pressure on prices, which as of April sit nearly 10 per cent higher than last year.
Prices started improving last year, but over the past several months the months of supply have been just over one month, contributing to the faster pace of price growth this month.
As of April, the benchmark price was $365,100. This is only slightly lower than record highs, due to lower price figures from the apartment and row sectors. Both the detached and semi-detached sectors have seen prices fully recover to previous highs.
April sales rose again compared with last month’s record highs.
New listings also remained elevated, but it was not enough to meet the demand, as the 178 sales outpaced the 161 new listings. Inventory fell to 172 units, which is the lowest April level recorded since 2007.
The months of supply dropped below one month in April, which is causing steep price gains. The unadjusted benchmark price in April hit a new record high at $439,300. This is nearly four per cent higher than last month and eight per cent higher than last year’s levels.
Improvements in new listings this month were nearly matched by sales activity, keeping inventory low.
In April there were 108 units in inventory, which is over 50 per cent lower than typical levels for this month. The low inventory levels and strong sales caused the months of supply to fall to one month.
Like other areas, Okotoks is experiencing strong price growth. In April, the unadjusted benchmark price reached a new record high at $463,000. This is nearly three per cent higher than last month and over 11 per cent higher than prices recorded last year.
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