Calgary has fallen on tough times in recent years, but the future looks bright.
According to a report by Urban Analytics, the city’s real estate market should be markedly stronger during the latter half of 2018 than it was during the former.
“Buyers adjusted to the impacts of the stress test, and we also see in the Calgary market, in particular, that there has been a bit of pent up demand based on the amount of new projects launched in the inner city,” said Kimberly Poffenroth, a senior market analyst with Urban Analytics.
“We’re seeing more inner city project launches. The inner city was pretty slow in 2017, in terms of project launches, but another reason we anticipate higher sales is we do see increased investor activity.”
Calgary fared better in the second quarter of this year than it did during the first, with a 28% sales increase. However, there was a 13% year-over-year decrease for the quarter.
“We attribute that decrease to the new mortgage interest rates and the stress test, which have made it a little more difficult, especially for first-time buyers, to qualify for a mortgage,” said Poffenroth. “That being said, we have seen an increase in sales in the outer submarkets where there are more price-sensitive product types. We’ve seen a lot more first-time homebuyers in those submarkets. It does relate back to the fact that they are able to qualify at a more price-sensitive point.”
Urban Analytics also noted that downsizers were more active than first-time buyers during Q2, but they’re still having trouble selling their homes. They are nevertheless flocking to multi-family dwellings, in part, because mortgages for those homes are easier to secure.
Judy Shilmar, a broker with Mortgage Architects in Calgary, does not disbelieve the Urban Analytics report but says the market doesn’t feel like it’s rebounded.
“Our unit numbers are off. We’re not doing the same number of transactions,” she said. “People are wondering when the economy will rebound, and some are very negative on the fact that we’ll get some of the appreciation back that we lost one or two years ago.”
Delinquency expected to rise
BoC hike this month a dead certainty - observer