Calgary’s market becoming juuust right


The Calgary housing market reminds me of Goldilocks and the Three Bears.  That’s the fable where Goldie breaks into the home of three bears — Papa, Mama and Baby — and discovers three bowls of porridge, one too hot, one too cold and one just right for her taste.

It pretty much sums up the market in Calgary right now — not red hot, but warmer than the cool summer, becoming, well, just right.  The home builders I’ve spoken with recently indicate, for the most part, sales range from not bad to pretty good, but they could be better.

Full disclosure: Builders will always tell you things could be better, just as you will say your wages could be better.  If any sales were pulled forward to beat the March 18 implementation of new mortgages rules, we might get a sense of that with year-over-year comparisons over the next eight weeks, traditionally the busiest of the year for builders in the Calgary area.

Overall activity is still lagging a bit behind last year at this time. However, year-to-date starts at the end of February are about 9% lower than last year, being pulled down by a 27% decline in single-family starts.

Additionally, the value of residential building permits issued by the city to the end of February is down 18% from the same time last year.  The cold winter probably prevented some new housing starts — these should show up in the March stats and as the uptick in sales in February trickles through city hall and turns into building permits, the value of those should also increase.

On the resale side, halfway through March, sales of single-family homes were on pace to match, if not exceed by a bit, sales for March 2010.  It’s a different story in the resale condo market, which appears to be hard-pressed to match sales recorded in March 2010.  Part of the resale condo slowdown could be attributed to the recent sales success at the Carlisle Group’s new Indigo Sky project in Saddle Ridge, where 235 condos were sold in a single day on Feb. 26.  There could also be a lack-of-demand hangover from the success of the University City condo project in Brentwood, which sold more than 400 new condos over a four-day period last fall.

Both projects, which have yet to break ground, were selling units well below the average resale condo price.

The current pace was expected.

In January, the Canada Mortgage Housing Corp. and Calgary Real Estate Board predicted a slow-ish market though the first half of the year, picking up in the second half, as the momentum that has been building in Alberta’s economy in the last year hits the ground running in the form of new jobs and increased net migration.

And a new report from RBC Economics says the jobs have arrived and the people should be next.


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