Home prices have stabilized in the prairie provinces, and are expected to improve slightly in Calgary and Edmonton, according to two reports released this week.
The Canadian Real Estate Association reported Monday that the benchmark price – which is the typical price of a home in a market – was down across Calgary, Edmonton, Saskatoon and Regina in November compared to a year ago.
Calgary’s price fell by 2.43 per cent year-over-year to $414,200, while Edmonton was down 1.65 per cent to $319,400. Saskatoon saw its benchmark price drop by 2.28 per cent to $287,600 and Regina experienced a 5.52 per cent decline to $260,000.
Nationally, the aggregate price of $638,300 in November was up 2.55 per cent.
But there is encouraging news for Calgary and Edmonton, according to the Royal LePage Market Survey Forecast. The two biggest Alberta cities should see modest home price gains in 2020 , it predicted.
In Calgary, the aggregate price of a home in 2020 is forecast to increase 1.5 per cent year-over-year to $477,000. The median price of a condominium is forecast to increase 0.75 per cent year-over-year to $267,500 and the median price of a two-storey detached home is forecast to rise 1.75 per cent year-over-year to $523,100.
“There are signs that the Calgary real estate market has touched its price floor and we are beginning a gradual return to balance,” said Corinne Lyall, broker and owner, Royal LePage Benchmark, in a statement. “There’s positive news with the Trans Mountain Expansion, increased net migration and new jobs. Calgary’s housing market will see some buoyancy but it’s not going to be immediate.
“Lenders have become more stringent, and many first-time home buyers have to improve their credit score, and wait a couple of years to save for a down payment and establish job stability. Saying that, we should still see more buyers entering the market this next year with continued low interest rates, positive migration, and less choice to rent with tighter vacancy rates.”
In Edmonton, the aggregate price of a home is forecast to increase 1.0 per cent to $383,200 at the end of 2020. The median price of a condominium and two-storey detached home are forecast to increase 1.5 per cent to $234,500 and 0.75 per cent to $438,700, respectively.
“We are seeing Edmonton move into a balanced market where buyers and sellers are negotiating. Sellers are compromising and buyers are realizing that prices are not going any lower,” said Tom Shearer, broker and owner, Royal LePage Noralta Real Estate. “In 2020, we should see a modest price bump but we are also expecting a healthy gain in sales activity.
“Despite previous uncertainty in the energy sector, the Alberta government’s focus on corporate tax cuts and making the province a more business-friendly area could potentially spur new job opportunities to come to the city.”
“In the Prairies, activity was a mixed bag. Sales were lower in Alberta (-3.9 per cent), as sales tumbled in Calgary (-8.1 per cent). The home sales data joins a list of indicators (LFS employment, CFIB small business barometer), suggesting some softness in Alberta’s economy during the month. Sales also dropped in Saskatchewan (-6.0 per cent). In contrast, activity increased in Manitoba month-on-month (+3.1 per cent), and was up a healthy 12.5 per cent year-on-year,” wrote Rishi Sondhi, Economist with TD Economics, in a commentary note.
Mario Toneguzzi is a business reporter in Calgary.
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