Calgary home sales were expected to be slow this year — but not this slow.
“We didn’t expect this much of a decline in sales activity,” said Ann-Marie Lurie, chief economist with the Calgary Real Estate Board, taking stock of the first nine months of 2018.
Fewer than 13,000 homes changed hands during that time, down 14 per cent from the same period in 2017, which was itself a slow year.
From a sales point of view, 2018 has been the slowest Calgary has seen in more than a decade. There was some thought, earlier this year, that the summer season might boost the pace of transactions, but that failed to materialize.
Sales have been below long-term averages for the past few years now.
Lurie said it’s increasingly apparent that “the market has changed” and the near future probably won’t look like the recent past.
“So that expectation of a quick rebound in the real estate market? It’s really just not the case,” she said.
“We just don’t expect to see that happen.”
In other words, the heady days of 2014 aren’t coming back anytime soon.
You can see how much things have changed in the graph above.
By September 2014, the number of home sales that year had already cracked 20,000. They would reach nearly 26,000 by the end of the year.
And prices followed.
If you bought a middle-of-the-road home in January 2014, you were $27,000 richer, on paper, by December.
Today, however, many homeowners are finding themselves in the opposite situation. Median prices are down $10,000 so far in 2018, compared with a year prior.
And there are indications the downward trend could continue.
Prices ‘still falling in Calgary’
The latest market outlook from Moody’s Analytics sees more price declines in the near future.
“Alberta’s housing market will be mixed, with prices flat in Edmonton but still falling in Calgary,” the report reads.
For detached houses — traditionally seen as the strongest segment of Calgary’s market — the report forecasts a 2.9-per-cent decline in median prices over the next year and a 3.6-per-cent decline the year after that.
Of course, these forecasts are just that — forecasts. Conditions can, and often do, change. And no one has a crystal ball.
But Emma May, co-founder of Charles Real Estate in Calgary, wouldn’t be surprised if prices continue to fall in the coming months.
“It’s still a very strong buyers’ market,” she said.
“There’s lots of inventory and prices are starting to move downwards but they haven’t really, quite yet.”
That inventory reached nearly 8,000 homes in September, according to CREB data, up 15 per cent from the year before.
At the current pace of sales, it would take more than six months to sell all those homes.
The current conditions give prospective buyers the luxury of being choosy, and May said many are exercising that advantage.
Some of her clients who want to sell are even reluctant to list their homes, said said, for fear of being subjected to a “whole flood of people” coming to kick tires without being willing to put in offers anywhere near the price they’re hoping to ask.
“They don’t want to go through the hassle of it,” she said.
“So there’s lots of sort of off-market stuff happening. I’ve been showing some buyer clients properties that haven’t been listed … because people are like, ‘I don’t feel like it’s a great time to put my house up, but I would be interested in selling.'”
Other would-be sellers who can’t get the price they want are opting to rent their homes in the meantime, and wait for a rebound in sale prices.
But May doesn’t expect that to come anytime soon.
“I think people need to wrap their minds around it,” she said.
“These prices aren’t going to be going up anytime soon and, if you want to sell, this is the new normal, for now.”
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Sherwood Park is a large hamlet in Alberta, Canada within Strathcona County that is recognized as an urban service area. It is located adjacent to the City of Edmonton’s eastern boundary, generally south of Highway 16 (Yellowhead Trail), west of Highway 21 and north of Highway 630 (Wye Road). Other portions of Sherwood Park extend beyond Yellowhead Trail and Wye Road, while Anthony Henday Drive (Highway 216) separates Refinery Row to the west from the balance of the hamlet to the east.
Sherwood Park was established in 1955 on farmland of the Smeltzer family, east of Edmonton. With a population of 70,618 in 2016, Sherwood Park has enough people to be Alberta’s seventh largest city, but technically retains the status of a hamlet. The Government of Alberta recognizes the Sherwood Park Urban Service Area as equivalent to a city.
Sherwood Park, originally named Campbelltown, was founded by John Hook Campbell and John Mitchell in 1953 when the Municipal District of Strathcona No. 83 approved their proposed development of a bedroom community east of Edmonton. The first homes within the community were marketed to the public in 1955. Canada Post intervened on the name of Campbelltown due to the existence of several other communities in Canada within the same name, so the community’s name was changed to Sherwood Park in 1956.
The Sherwood Park Urban Service Area is located in the Edmonton Capital Region along the western edge of central Strathcona County adjacent to the City of Edmonton. The majority of the community is bound by Highway 16 (Yellowhead Highway) to the north, Highway 21 to the east, Highway 630 (Wye Road) to the south, and Anthony Henday Drive (Highway 216) to the west. The Refinery Row portion of Sherwood Park is located across Anthony Henday Drive to the west, between Sherwood Park Freeway and Highway 16. Numerous developments fronting the south side of Wye Road, including Wye Gardens, Wye Crossing, Salisbury Village and the Estates of Sherwood Park, are also within the community. Lands north of Highway 16 and south of Township Road 534/Oldman Creek between Range Road 232 (Sherwood Drive) to the west and Highway 21 to the east are also within the Sherwood Park urban service area.