A market imbalance triggered by significantly increased inventory has noticeably restrained price growth in Calgary, according to the city’s real estate professional body.
In a statement released on Monday (May 2), the Calgary Real Estate Board said that last month’s numbers continued to exhibit the trend of year-over-year decline in sales volume that started half a year ago. Meanwhile, the number of new listings went up in April, which led to benchmark prices for residential resales dropping to $441,000 (0.4 per cent lower than March, and 3.4 per cent lower than April 2015).
The cooling effect has been most visible in the sellers’ side of the market, the CREB report stated.
“From re-considering the listing of their home to lowering expectations on price, sellers are beginning to adjust to the current market reality,” CREB president Cliff Stevenson stated in the news release. “[Some] buyers in the market are still not willing to pull the trigger because they expect even bigger discounts. And so that gap between buyers’ and sellers’ expectations still persists across many product types and locations.”
The sales-to-new-listings ratios of the apartment and attached sectors dropped by 19 and 13 per cent (respectively) on a year-over-year basis last month.
“While the weak economic climate is influencing demand, the apartment and attached sectors are further impacted by increased supply in the competing new home sector and rental markets. This is one of the contributing factors to the steeper price declines recorded in the apartment sector,” the board’s chief economist Ann-Marie Lurie said.
“Since the start of the price declines, monthly unadjusted benchmark apartment prices have declined by 7.6 per cent, while semi, row and detached have declined by a respective 5.9, 4.6 and 4.1 per cent,” the CREB report concluded.