High Inventories Could Lower Prices
Calgary and area saw another month with elevated inventories, and softening sales. Multiple months of excess supply is showing signs of weighing on prices in the area. No all is bad news though - many economic indicators are pointing to a brighter outlook.
“While economic activity has improved in 2017, it will take some time for this to translate into housing market growth. There have been employment gains, but most of this has occurred in areas with traditionally lower income,” said CREB® chief economist Ann-Marie Lurie.
October had 1,467 sales, representing a reduction of nearly 11% in sales when compared to October 2016. Combine slower sales with 2,604 new listings, and it's obvious that we are in a slow real estate market. Last year we had a little over 10% fewer new listings in October (2,361).
Even with the current supply and demand, prices seem to be holding relatively firm when compared to October 2016 prices. Overall, many parts of the city have experienced modest price increases in the detached sector. The benchmark price for the City of Calgary started improving around February of this year, but has softened since the summer. We have been experiencing the higher inventories for a few months now, and it will be interesting to see if the market balances itself as the seasons change, or if we will start to see softening of prices.
It's All About Perspective...
The recent sales and new listing numbers do not give the impression of a balanced market, and its not. It's definitely a buyers market right now. That being said, 2017 hasn't been all bad news. We did have a very strong start to the year, which has us sitting at 16,469 sales year to date at the end of October. That is compared to 15,642 sales for the same portion of 2016. Even with the slow market in the last few months, we are still ahead of last years numbers in terms of sales.
Over $8 Billion In Real Estate Sales For Calgary Real Estate Board, Year To Date (End Of October)
Year to date sales volume at the end of October surpassed the $8 Billion mark, which is more than half a billion more than the same period of 2016 ($7.478B).
Pricing, Pricing, Pricing!
Everyone has heard of the old real estate saying "Location, Location, Location!!"... and it's definitely accurate! Location has a huge impact on value of a property. But in a buyers market like this, where we have substantially more listings than we do sales, you MUST price your home competitively if you want to sell. There are of course many other things that go into a successful sale - cleaning, staging, professional photographs etc, but no matter how fancy you stage your home, or how bright and sunny the photographs look, if you are even slightly overpriced in a market like this, you can expect to sit on the market for a long, long time.
Be clear - you do not have to undercut the value of your home! But, you must recognize that the supply and demand levels of the market are constantly changing the value of your home. With elevated inventory levels, you may have lost a bit of value in your home. And in hot hot hot markets, people tend to "test the market" by pricing the home a bit higher than the market value, to see if you can squeeze a few extra dollars out of a buyer. If you are serious about selling your home in this market, you need to understand and acknowledge the realistic market value of your home, prepare your home properly for sale, and PRICE YOUR HOME ACCURATELY!
Any questions about the Calgary real estate market, or if you'd like a market statistics package for your community, please Contact Us and we'd be happy to help! Use the Contact Us form on our site, send an email to email@example.com, or call/text 403-815-0114.