House prices can help tell you what’s happening in a local economy.
A good indication of that came out on Monday when the Canadian Real Estate Association released its monthly MLS data for August.
The report showed that in Calgary the benchmark price, which reflects the typical property in a market, was $426,800 for the month. That was down 2.24 per cent from a year ago.
Calgary’s benchmark price was off by 5.26 per cent from three years ago but was 4.36 per cent higher than five years ago.
The same trend has been taking place naturally in Edmonton as the benchmark price was $330,500 in August. That was down 2.07 per cent year over year. It was also off by 4.4 per cent from three years ago but up 1.39 per cent from five years ago.
At the national level, the benchmark price, taking the aggregate of 18 Canadian markets, rose to $625,400 in August, up 2.54 per cent on an annual basis. Thanks to robust markets in Toronto and Vancouver especially, that national benchmark price has increased by 29.41 per cent from three years ago and by 45.13 per cent from five years ago.
In August, there were 41,151 MLS sales across the country, representing a 3.8 per cent year-over-year decline.
“The new stress-test on mortgage applicants implemented earlier this year continues to weigh on national home sales,” said Barb Sukkau, CREA’s president. “The degree to which the stress-test continues to sideline home buyers varies depending on location, housing type and price range.”
The association released its updated MLS forecast for 2018 and 2019 on Monday.
It said Canadian sales would fall by 9.8 per cent year over year this year to 462,900 units but rebound with 2.1 per cent growth in 2019 to 472,700. Alberta is predicted to experience sales declines in both years – falling 6.5 per cent in 2018 to 53,500 and dropping a further 1.1 per cent in 2019 to 52,900.
The average MLS sale price for Canada is forecast to fall by 2.8 per cent this year to $494,900 but grow by 2.7 per cent next year to $508,500.
In Alberta, CREA is forecasting the average MLS sale price to decrease by 1.4 per cent this year to $392,800 and remain flat for 2019 at $392,700.
Mario Toneguzzi is a veteran Calgary-based journalist who worked for 35 years for the Calgary Herald, including 12 years as a senior business writer.
The views, opinions and positions expressed by columnists and contributors are the author’s alone. They do not inherently or expressly reflect the views, opinions and/or positions of our publication.
