New data from the Canadian Real Estate Association shows the ongoing impact of the oil price collapse on the Calgary and Edmonton housing markets.
In December, the benchmark price of a home in the Calgary region was $417,400 which was down 1.11 per cent from December 2018. But the price was off 4.46 per cent from three years ago and decreased by 9.56 per cent from five years ago.
The benchmark price is considered to be what’s typical for homes in a specific market.
Edmonton’s pattern was similar. In December, the price was $317,700, down 2.09 per cent year-over-year. The price declined by 5.16 per cent from three years ago and by 9.08 per cent from five years ago.
Alberta’s economy was hit hard following the oil price collapse. That sent the province into recession years in 2015 and 2016 as thousands of jobs were lost. The economy, which has slowly been recovering from that shock, remains challenged although numerous economic forecasts suggest it will be a leader in Canada in the next two years.
In contrast, the benchmark home price across Canada for 19 markets surveyed was $643,700 in December. That’s an increase of 3.28 per cent from the previous year and reflects primarily elevated prices in major markets such as Vancouver and Toronto. The national aggregate price is up 14.02 per cent from three years ago and a whopping 39.37 per cent from five years ago.
CREA said home sales recorded over Canadian MLS systems edged down 0.9 per cent in December, ending a streak of monthly gains that began last March. Activity is currently about 18 per cent above the six-year low reached in February 2019 but ends the year about seven per cent below the heights recorded in 2016 and 2017, it said.
Activity was up 22.7 per cent compared to a quiet month of December in 2018.
“The momentum for home price gains picked up as last year came to a close,” said Gregory Klump, CREA’s Chief Economist, in a statement. “If the recent past is prelude, then price trends in British Columbia, the GTA, Ottawa and Montreal look set to lift the national result this year, despite the continuation of a weak pricing environment among housing markets across the Prairie region.”
Mario Toneguzzi is a business reporter in Calgary.
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