Calgary Sept 09 Stats

The median price of a single family Calgary metro home in September 2009 was $399,900, showing no significant change from August 2009, when the median price was $400,000, and up 1 per cent from September 2008, when the median price was $395,000. The median price of a condominium in September 2009 was $265,000, up 2 per cent from August 2009, when the median was $260,000, and showing no change from September 2008, when the median price was $265,000. All Calgary metro MLS® statistics include properties listed and sold only within Calgary’s city limits. The median price is the price that is midway between the least expensive and most expensive home sold in an area during a given period of time. During that time, half the buyers bought homes that cost more than the median price and half bought homes for less than the median price. “In the third quarter Calgary shifted to a more balanced housing market. But conditions are still very favourable for home buyers,” says Scott. “Mortgage rates remain low, affordability continues and federal government incentives such as the $5,000 tax credit may motivate first-time homebuyers to make a purchase before the end of the year.”

“This recession has been a tricky one. Consumers were expecting the worse yet the housing rebound came faster than expected. I think it is safe to say the worst is behind us, but it will take some time for consumers to really shake off their economic jitters,” adds Scott. Data supplied by The Calgary real estate board for Sept 09 statistics package

Economists are running out of superlatives to describe the rebound in Canada’s housing market, in which sales are up 60 percent from earlier this year.
“The speed and magnitude of the rebound in sales activity” is “remarkable,” says the Canadian Real Estate Association (CREA). Association president Dale Ripplinger says, “The difference in the resale housing market now, compared to the beginning of the year, is night and day.”
“The Lazarus-like rise in sales has halted the slide in prices – say, whatever did happen to the meltdown in Canadian housing anyway?” asks Douglas Porter, deputy chief economist at BMO Capital Markets.
“The turnaround in Canadian housing this year might be the single most surprising turnabout we’ve seen in any economic indicator I can think of. The extent of it is nothing short of amazing,” Porter says.
Like Porter, most economists were caught by surprise, and most of them have had to revise their real estate forecasts for this year. CREA predicted in May that MLS sales in Canada would drop by 14.7 per cent this year compared to 2008. Now, it says sales will decline by just 0.4 per cent. The association says prices will rise by 1.5 per cent this year.
Canada Mortgage and Housing Corp. (CMHC) also has a revised forecast, and is calling for a small drop in sales activity and sales.
In the Toronto market, economist Will Dunning says, “For the past three months, resale activity has been much stronger than I had been expecting, and the sales rate has been raised very substantially.” He boosted his forecast from 62,100 to 83,000.
In Vancouver, “resale activity has staged one of the most spectacular comebacks in Canadian real estate history,” says RBC senior economist Robert Hogue in the Housing Trends and Affordability report. “From their lowest levels in about 19 years at the end of 2008, sales of existing homes more than tripled by July to levels just shy of peaks reached before the downturn.”
So what happened? Why is housing leading Canada’s economic recovery?
“Low interest rates are boosting sales by returning homebuyers to the market who moved to the sidelines last year,” says Gregory Klump, CREA’s chief economist. “Buyers are also shifting purchase decisions forward as they take advantage of attractive interest rates now before financing costs increase.”
RBC reports that housing affordability improved in Canada for the fifth consecutive quarter during the second quarter this year, driven down by low interest rates and dropping prices.
With prices and activity down early this year, many vendors decided to take their homes off the market until the situation improved. That created a shortage of listings, and thanks to the law of supply and demand, stopped the slide in prices. In August, it’s been reported that 14 per cent of listings in the Toronto market had multiple offers submitted.
“Yes, Virginia, it’s a sellers’ market again,” says Porter. “The biggest, priciest, and previously hardest hit markets are the very cities that are now rebounding most rapidly.”
Now, the economists are over their shock and are throwing cold water on the idea that the market can continue to expand at this rate. Klump says that since buyers moved their purchases ahead to take advantage of low mortgage rates, next year will see a more stable market.
“The strong pace seen in the second quarter of this year reflects, in part, activity that was delayed in the previous two quarters and is not likely to be sustained,” says CMHC. “The level of sales will move back to be closer in line with improving economic conditions.”
Toronto economist Dunning agrees. “I think the sales rate will erode rapidly in the next few months. The stronger resale market has arrested the drop in values seen earlier this year. But, if sales slow to the extent I expect, the price recovery may be just about finished.”
Only Porter at BMO Capital Markets seems to be hedging his bets in predicting the boom times are over. “Record-low borrowing costs and the mounting sense that the worst of the economic storm has passed are the key ingredients in the remarkable turnaround,” he says. “We keep saying that further gains will be harder to come by, but the market keeps churning out those gains.”

Written by Jim Adair
In closing it would seem this could be the lower end of the market. You know what Mr. Buffet says “ if you want to make a great profit do the opposite of what everyone else is doing”
It would seem this is a great time to get back into the market based on the current economic trends and it would be my pleasure to help.
With thanks, and call if I can be of any assistance.
Rod Forsythe 403.777.1040/ e-mail rod@rodforsythe.com

Quote of the month for September 09
“Our deepest fear is not that we are inadequate. Our deepest fear is that we are powerful beyond measure. It is our light, not our darkness, that most frightens us. We ask ourselves, who am I to be brilliant, gorgeous, talented, and fabulous? Actually, who are you not to be? You are a child of God. Your playing small doesn’t serve the world. There’s nothing enlightened about shrinking so that other people won’t feel insecure around you. We are all meant to shine, as children do. We are born to make manifest the glory of God that is within us. It’s not just in some of us, it’s in everyone. And as we let our own light shine, we unconsciously give other people permission to do the same. As we are liberated from our own fear, our presence automatically liberates others.”
Written by Marianne Williamson.