Calgary and Edmonton see average home price drop
July 13, 2016
On July 13, data was released from the Royal LePage House Price Survey, which gathers information on two-storey homes, bungalows and condos in 53 real estate markets across Canada.
The brokerage anticipates the average price of a home in Canada will be 12.4 per cent higher than average prices at the end of 2015.
“Our forecasting models, which pointed to a slowing housing market as the year progressed, included a modest increase in the cost of borrowing,” said Phil Soper, president and chief executive officer of Royal LePage.
Economic and social “disruptions” have introduced new risks, causing the Bank of Canada to leave interest rates as is for now, Soper said in a press release on July 13.
Canada’s real estate market showed high appreciation in the second quarter of 2016, with the highest year-over-year increase in the last five years.
The average price of a home in Canada increased by 9.2 per cent year-over-year to $520, 223 by the second quarter of 2016.
So what does that mean for Alberta's housing market?
Calgary
The second quarter of 2016 saw the aggregate price of a home in Calgary fall slightly by 1.8 per cent year-over-year to $454,790, according to Royal LePage.
“Agriculture and tourism industry strength has helped keep the Calgary economy buffered to some degree from the current challenges in the energy sector,” said Corinne Lyall,owner and broker at Royal LePage in a press release.
Royal LePage predicts Calgary prices will increase by one per cent for the second half of 2016, compared to the same time last year.
“While sales are down, prices have remained mostly stable. We have seen recent price increases due to activity in the single-family market under the $500,000 price point,” said Lyall.
Looking at the average prices per housing type, the median price of a condo fell by 1.4 per cent to reach $298,309 compared to the same time in 2015. Median prices for bungalows and two-storey homes fell 2.6 per cent and 1.6 per cent respectively, year-over-year.
Edmonton
Like Calgary, Edmonton also experienced a slight decline in aggregate housing prices during the second quarter of 2016. Prices fell by 1.2 per cent year-over-year to $377,337.
Prices of both bungalows and two-storey homes fell by four per cent and 0.4 per cent, while the median price of a condo increased by 2.2 per cent to $243,383.
“Edmonton has weathered the energy sector’s dip and the city’s stable economy has contributed to a balanced housing market,” said Tom Shearer, broker and owner of Royal LePage.
The creation of almost 30,000 new jobs in Edmonton in the healthcare and government services sectors has caused many young families to move to the city, according to Shearer.
Predictions for the second half of 2016 are an aggregate price drop of one per cent, compared to prices at the end of 2015.
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About Olivia Bowden
Olivia Bowden is a freelance writer and is currently an Editorial Intern at YP Next Home. She attends Carleton University and is completing a Master of Journalism degree. Olivia enjoys learning and writing about the Canadian real estate market.