For Calgary homebuyers, the slowdown means opportunity

Uncertainty with the fallout from the drop in oil prices has resulted in sluggish sales in Calgary’s real estate market and a drop in new housing starts to kick off 2015, according to recent figures. But this also means opportunity for Calgary homebuyers.Based on year-to-year comparisons, in the first two months of the year, sales dropped by almost 39 and 34 per cent respectively, according the Calgary Real Estate Board (CREB).Total sales in Calgary in January and February were 2,097 compared to 3,289 in the same time period in 2014. Total inventory in February was 5,474 – slightly more than four month’s supply – compared to 2,641 last February.“Overall, we might have a four-month supply of inventory, but we also need to consider that a four to five month supply is typical of a stable market,” says CREB President Corinne Lyall.“Currently, 55 per cent of the sales of detached homes are priced mostly between $400,000 and $600,000, 84 per cent of apartment style condo sales are under $400,000, while 64 per cent of townhome sales are under $400,000, so there are more first-time buyers,” she says. “But they also stimulate other areas of the market, because those sales allow sellers to move to the next level.”Lyall notes the increase in listings means more choice for buyers and, coupled with low interest rates, this provides more opportunity for Calgary homebuyers in the market.“In this market, homeowners need to be aware of what is selling and their competition and price their home accordingly,” she says. “There is some pent up demand so any sign of a price shift or anything positive is going to encourage people to make a move.”Re/Max House of Real Estate Realtor and luxury home specialist Ross Pavl agrees that “we’re seeing activity with well-priced homes for specific buyers and we’re having great turnouts at open houses.“We still have less listings than we did in 2009 and 2010, so I don’t see the shift in the market as being a major meltdown,” Ross says. “When the market slows, it does affect sales of luxury and out of town properties (such as acreages), but there is also opportunity in those markets because there may be a softening in the prices.”Meanwhile, Canada Mortgage and Housing Corp. data shows housing starts in Calgary fell by 38 per cent to 791 units compared to the previous year.“When the economy is unstable, consumer confidence can be affected – especially in the housing market, which, for many people, is the largest financial commitment they will make in a lifetime,” says Wayne Copeland, president of CHBA - Calgary Region. “So, today, the negative headlines have caused some people to delay their homebuying decisions.“That said, we are coming off a record year, especially strong in the multi-family sector, so lower numbers were already anticipated – and that’s where the numbers are down. It’s no surprise,” he says, noting the continued low interest rates “bode well for our industry, especially for first-time buyers just starting out.”Related reading:The sky is not falling in Alberta: home buildersCalgary to be among leaders in home price growth in 20155 things to watch in Canadian real estate in 2015