House sales in Calgary 25% below long-term averages, CREB says

The arrival of spring typically means an uptick in the real estate business, but so far this year, that hasn't been the case in Calgary.

The total number of housesales in April was 1,518 down from 1,900 the previous April, a drop of more than 20 per cent. That's 25 per cent below long-term averages, the Calgary Real Estate Board(CREB) said in its latest report.

The detached-home sector saw the largest decline, with a year-to-date sales total of2,991 units, 27 per cent below the 10-year average.

One big reason for the dropis the new mortgage stress test imposed by Ottawa in January, Emma May, co-founder of Charles Real Estate in Calgary, told the Calgary Eyeopener.

• 'Be really realistic,' advises real estate agent as Calgary sales drop 18%

"In December, I had a certain pool of buyers who would be able to buy a certain house that I had listed at a price point. Well, I've just lost a whole bunch of them. They can't even look at it," she said.

"We've pushed those buyers into a market where they're looking at things that are like $200, $300, $400,000 cheaper than product that they were looking at before. And they don't like what they're seeing. So they're going out and they're shopping in this new price-point that they're now told they can afford, and nothing appeals to them."

May says it's still possible that better weather will get more prospective buyers out looking and making deals. But a lot of sellers might find they need to lower their expectations to match the current market conditions in Calgary.

'Readjust your expectations'

"By the time we get to the end of May, if you're not getting deals done at your price point, I think you really need to readjust your expectations and look at what a realistic price might be for your house," she said.

CREB's latest statistics indicate detached-home sales in Calgary dropped 23.8 per cent from last April to April this year. Attached-home sales were down 18 per cent.

In the apartment-condo market, the year-over-year drop in sales was a more modest 7.2 per cent. However, the average price dropped 5.6 per cent, from $303,361 to $286,381.

May says an oversupply in that market creates fierce competition among sellers.

"In some buildings, really what's happening is you have a race to the bottom," she said.

"A lot of condo units really are priced according to what the other units in that building are priced at, and you will inevitably have someone who needs to get out," she said.

According to the Scotiabank Calgary Housing Outlook, home sales and prices will likely stay flat through to 2019, partly because of the ongoing "counterbalancing headwinds" created by the new mortgage stress tests.

But demographics still work in Calgary's favour going forward, the Scotiabank report says.

"In addition to an average age of 37.4, the lowest in the country in 2016, the 24.7 per cent share of Calgary's population aged 25 to 39 years old, considered the prime home-buying age bracket, was the highest of any [metropolitan area]," the report says.

With files from the Calgary Eyeopener.

• MORE CALGARY NEWS|$3.8B debt interest will be burden for young Albertans, Calgary researchers say
• MORE CALGARY NEWS|Veteran police officer says flashing your high beams isn't illegal