Aerial view of suburbs in southwest Calgary.
A national real estate firm is predicting prices in Calgary’s resale housing market, and across the country, will continue to increase in 2015 despite low oil prices.
In releasing its house price survey and market survey forecast Wednesday, Royal LePage said the average price in Calgary will climb 2.4 per cent from 2014 to $472,000 while the Canadian average price will see a 2.9 per cent hike to $419,318.
It said the recent drop in oil prices did not impact the overall real estate market in the fourth quarter of last year.
Royal LePage said Calgary saw healthy price increases in all categories in the fourth quarter with average prices for detached bungalows jumping 9.1 per cent year-over-year to $511,889 and standard two-storey homes increasing 8.5 per cent to $500,320. Standard condominiums also experienced robust growth, rising 9.1 per cent to $311,644, it said.
“The Calgary market was one of the hottest in the country, with all three major housing categories seeing near double-digit price growth over this time last year,” said Ted Zaharko, broker and owner of Royal LePage Foothills, in a news release. “There remains a structural imbalance between the availability of homes and number of eager homebuyers. This fundamental discrepancy between supply and demand explains why we’ve seen such aggressive price appreciation in 2014.
“Inventory availability remains a major issue across the city, as frustrated buyers are chasing a limited number of homes. The one exception is condominiums, where new units are being built at a faster rate.”
Nationally, the average price for bungalows rose by 6.7 per cent to $406,218. Two-storey homes were up six per cent to $443,379. Condos were also up by 4.5 per cent to $257,624.
“For our 2015 forecast, we could not ignore the potential impact of the steep decline in the price of oil on housing markets across Canada,” said Phil Soper, president and chief executive of Royal LePage. “In the immediate term we anticipate that the natural slowing of home price appreciation we called for in the third quarter of 2014 will be delayed in Central Canada and accelerated in the West by recent developments in the energy sector.”
Zaharko said fourth-quarter MLS sales were up from the same period last year but down from the “heightened” levels seen earlier in the year.
“While we expect price rises may moderate in 2015, the upward trend we’ve seen over the past few years is unlikely to reverse without a meaningful increase in inventory,” said Zaharko.
“Oil is a major economic influence in Calgary, so the recent price drop is worrying. While we believe there may be some immediate term impact on the local housing market in the form of slowed appreciation, there would need to be prolonged low oil prices for any spillover into the housing market to be significant.”