Quote:
Originally Posted by I-Hate-Hulse
So what are people's estimates for what housing prices do in Calgary for 2020?
On one hand you have CMHC's report speculating that prices could be down 25% in Alberta. I'd say that 25% is valid for Calgary with it's head office concentration.
Then you have CREB issuing a revised for report Calgary May 1. They report a decline of 2-4% depending on housing type, but don't make a call on where it goes. Lots of stats if you are inclined to drill into these results further ( link)
Apologies for the bearish outlook - but my crystal ball estimate are:
- From June to Sept 2020 pricing declines according to CREB's minus 2-4% estimate for detached and attached housing. Apartments decline 5-7%
- In Sept the CEWS wage subsidy ends and a lot of companies counting on it turn to layoffs. Pricing declines on attached/detached over the next 6-12 months from Sept 2020 onwards get to 15% as forced sales increase. Apartment pricing declines 10-25%.
- WFH starts moving people towards larger homes back into the suburbs on the basis of 'bang for your buck'
- Purpose built rentals continue to saturate the apartment market and continue to drive apartment condo pricing downwards.
- A good number of small to medium developers crater, especially those focus on inner city infills and multi-family developments.
Just my guesses. As a person with a rental property I sincerely hope I'm wrong. Would love to hear what people in real estate are seeing. |
I have no data to back this up...only anecdotal evidence of a slightly more positive viewpoint and I am in a similar situation as you.
Only people that cannot afford their homes (and have barely been able to afford them for many years) will actually be forced to sell. This is reflected in the general low quality of detached houses on the market (especially in the inner city and surrounding communities). There are also lot of duplexes, but no one is moving there. Condo owners who would have previously upgraded to duplexes are scared to buy and cant sell their condo. Not a lot of people are moving from a suburb duplex or townhome to an intercity equivalent.
People who dont absolutely have to sell will ride this out. Given that people are not as stretched as they were in the 2009 US and that the associated quality of home is poor for those that are stretched, the median price will just flatline (on quality detached homes). Poor quality homes will drop like a rock because builders cant afford to tear them down and build duplexes that wont sell. In 2009 in the US many had 0% down on really nice homes - when that tanked they pulled every house down.
Condos are screwed unless they are in a highly desirable lifestyle area because the 1-5 year transient people that came in bulk for O&G jobs aren't getting hired anymore.