Recovery of Calgary’s real estate market has been slow and home prices declined in the fourth quarter of 2019, says a report released Thursday by Royal LePage.
The real estate company’s House Price Survey said the aggregate home price in Calgary decreased 2.3 per cent year-over-year to $469,916 in the fourth quarter of 2019. However, in the last six months of 2019, the aggregate price of a home in Calgary increased 2.1 per cent, from $460,089 in the second quarter of 2019.
Broken out by housing type, the median price of a two-storey home decreased 1.0 per cent year-over-year to $514,139, while the median price of a bungalow decreased 4.1 per cent year-over-year to $488,521. Meanwhile, the median price of a condominium decreased 6.9 per cent year-over-year to $265,488, it said.
“Sales have improved and inventory has gone down in both detached houses and townhomes. Buyers are taking advantage of reduced prices, primarily in the single-family home segment,” said Corinne Lyall, broker and owner, Royal LePage Benchmark, in a news release. “There is still a surplus of condos available offering excellent choice for buyers looking at turnkey properties with little maintenance.”
The report said home prices in Edmonton were relatively flat in the fourth quarter. The aggregate price of a home in Edmonton decreased 0.7 per cent year-over-year to $379,426. Broken out by housing type, the median price of a standard two-storey home increased 1.2 per cent year-over-year to $435,426 and the median price of a condominium remained relatively flat, increasing 0.3 per cent to $230,969. During the same period, the median price of a bungalow decreased 5.1 per cent year-over-year to $361,943.
“Home buyers in Edmonton have adjusted to the mortgage stress test and sellers are making appropriate compromises,” said Tom Shearer, broker and owner, Royal LePage Noralta Real Estate, in a news release. “Sellers are optimistic when meeting buyers that they are ready to make a purchase.”
Nationally, the report said the aggregate price of a home increased 2.2 per cent year-over-year to $648,544 in the fourth quarter of 2019. Similar to the third quarter, potential buyers are continuing to come back to the real estate market. In the first half of 2019, buyers had remained largely at the sidelines waiting to gauge the potential impact of the federal mortgage stress test, it said.
“We have successfully navigated the first significant national housing market correction since the Great Recession a decade ago,” said Phil Soper, president and CEO, Royal LePage. “While the drop in the number of properties bought and sold during the 2018-19 downturn was large, the value of homes in Canada held up remarkably well, with only minor, single-digit declines in the areas of Ontario and B.C. that had experienced the most aggressive price inflation in recent years, and of course those regions still suffering from a downturn in the oil and gas sector.
“The federal government has signalled that changes could come to the mortgage stress test mechanism in 2020. The stress test pushed people out of real estate markets across Canada temporarily. For the most part, buyers have adjusted, yet it still represents a significant hurdle as families pursue the dream of owning their own home.”
The Royal LePage National House Price Composite is compiled from proprietary property data in 64 of the nation’s largest real estate markets. When broken out by housing type, the median price of a two-storey home rose 2.3 per cent year-over-year to $761,817, while the median price of a bungalow increased modestly by 0.7 per cent to $537,622.
Across Canada, condominiums remained the fastest appreciating housing type, with the median price rising 3.3 per cent year-over-year to $487,525.
Mario Toneguzzi is a business reporter in Calgary.
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