Calgary Real Estate August 2020 during COVID-19 Pandemic
While it is becoming increasingly clear the effects of the Covid-19 pandemic and rupture in the economy has had some effect on Calgary's (or Canada's) housing market, but not as much as first feared, there are mixed signals about future trends. On a personal note, I have been involved in several multiple offer situations in the past weeks, and shocked by some surprising quick sales as well. Well priced houses (especially in the detached sector) seem to sell quickly and close to asking price. Sales have been steadily well over the 50% ratio of sales to new listings, improving greatly over the past few years, but not at the 65% seen in July when changes were coming to mortgage lending. Interest rates are as good as they will ever be and that is certainly helping sales and modest growth in prices in the detached and row house sector.
The stats indicate a slight downward trend continues for condos though continuing to modify somewhat, and a recovering trend specifically in the detached market. Similar improvements are seen in month-to-month stats for semi-detached and row houses though this abrupt turnaround is not reflective in the negative stats in the year-to-date category. In other words, while Attached homes inventory is dropping, prices that have been dropping show signs of improving this month.
Sales have been steady in all categories over the past few months as the normally busy spring market started late (because of the lock down) and got pushed right into summer.
Compared to last year (which historically saw poor performance), things are looking better. Detached YTD (Year to date) saw 12% fewer sales but 15% newer listings, leading to a drop in supply of 17%. Month of Supply is down by 5.6% as is DOM (days on market). Prices have remained steady compared to last year. August 2020 compared to August 2019 saw even more of an improvement. Supply was down by 15% and months of supply by nearly 20%. Most importantly Average Price was up by 3.3%!
Semi-detached had been struggling lately. Total sales both YTD and during August 2019 was down about 12%. New listings are really dropping as builders have stopped building because of low earnings - down 26% from last August and 18% YTD. DOM is thankfully improving at 7% less than last August. The big discrepancy is in prices. August this year is up both in Medium Price and Average price between 7 and 9% from last August. But the YTD tells a different tale as both prices fell by over 5% over the year, meaning earlier sales were brutal this year.
Condos are continuing to suffer. Total sales down between 18 and 20% YTD and with monthly comparisons. Listings are dropping thankfully by 26% from last August and 18% YTD. DOM is also down from last August by 10% and 7% YTD. They are selling faster, but at a 3.5 to 7% drop in price compared to already brutal 2019 figures.
Row houses have leveled off with slight price drops of 3.5%, less inventory but actually INCREASES of sales by 7.5%.
There are still many challenges ahead. While it seems investor/buyer confidence in the market has improved, Calgary still has unemployment issues and no one knows just how much government subsidies have been propping the housing industry. It can be said that Calgary is still the affordable alternative to other major centers (which also have employment issues and much higher prices), the general trend still continues to show very slight upward movement.
If you're searching for detached houses over 600K, you can afford to take your time. But nice properties in the 400-600K range continue to sell quickly. What is clear is the drop in new builds, particularly in the attached sector, that may eventually lead to a shortage of supply in the future. That may ultimately lead to a turnaround in prices in the semi-detached sector.
As always, a lot rests on the economy and how quickly things get back to "normal".