Monthly Market Update

[Travis Munroe]

The apartment/condo numbers are expected to be higher with a ton of new inventory and new announcements for projects.
As for the SFH, .... much better than what most people thought coming out of Q1. March was a strong month helping out the slower Jan / Feb.

[polak]

Originally Posted by Realtor 1

The apartment/condo numbers are expected to be higher with a ton of new inventory and new announcements for projects.

[rd_aaron]

Originally Posted by calgarygeologist

Looks like Q1 for the Calgary housing market is at -2.3% for average price and -1.2% for median price. Apartments/condos are down 3.2% and 5% respectively.

That's Q1 2015 vs Q1 2014? I wonder how it compares to Q3 or Q4 of 2014. There was a pretty good run-up of prices during the middle of last year (I heard some places appreciated 10% in a year) so the difference could be even bigger.

[ken0042]

One other factor to consider is the end of a lot of Temporary Foreign Worker contracts. The numbers on the news said 16,000 workers in Alberta had to leave as of yesterday; so I'd say Calgary likely has 1/5 to 1/4 of those workers. If that's 3000 workers, given home sharing that is easily an extra 500-1000 rental properties hitting the rental market.

I know the two markets aren't directly related, but there has to be some spill over if demand decreases.

[polak]

Leave? Don't they know about our excellent social programs?

[Travis Munroe]

As I expected and mentioned numerous times throughout March... the most recent stats would surprise some doom and gloomers.

First post in this thread has been updated and you need to subscribe if you want the full package but...

Inventory levels drastically came down
Detached home prices are up 4% from February
Active listings remain high granted many of them are stale while there were over 500 more sales in March than there was in Feb.
Homes are spending 11 more days on the market compared to this time last year.

29 year average increase in Calgary residential sales is 6.73% .... far from falling off a cliff type of growth IMO.

Dont get me wrong... it is not all peachy out there and I know a ton of people have lost or will lose jobs but re reading some posts in this thread..... we have a long ways to go to reach a 30% decrease in housing values......very long.

[lorenavedon]

people need a place to live and rents are still high. Rates are low and will remain low for most of our lifetimes. This will continue to fuel the housing market. Sure, it likely wont boom and shoot up stupid amounts like in the past, but prices are very unlikely to drop any significant level. Be picky, buy a good location at a good price and the risk is extremely low. Housing is not something people can put off. It's not like you can live in a cardboard box for 2 years while house prices come down. Rent will eat up your downpayment etc. Would I buy investment properties now? Of course not, not yet until we've seen this play out. But if you're looking for a place to call home I just don't see the downside. Like Realtor1 just showed, things are actually picking up again and the listing storm has stopped. In fact, the huge flood of listings seem to me that they were nothing more than regular spring sellers/upgraders listing early to front run the market. No panic selling at all so far

[Kavvy]

Originally Posted by Realtor 1

As I expected and mentioned numerous times throughout March... the most recent stats would surprise some doom and gloomers.

First post in this thread has been updated and you need to subscribe if you want the full package but...

Inventory levels drastically came down
Detached home prices are up 4% from February
Active listings remain high granted many of them are stale while there were over 500 more sales in March than there was in Feb.
Homes are spending 11 more days on the market compared to this time last year.

29 year average increase in Calgary residential sales is 6.73% .... far from falling off a cliff type of growth IMO.

Dont get me wrong... it is not all peachy out there and I know a ton of people have lost or will lose jobs but re reading some posts in this thread..... we have a long ways to go to reach a 30% decrease in housing values......very long.

Hey Realtor1, please define inventory and how you are measuring the price increase for detached homes (benchmark vs average vs median)

[Red]

Originally Posted by Realtor 1

As I expected and mentioned numerous times throughout March... the most recent stats would surprise some doom and gloomers.

First post in this thread has been updated and you need to subscribe if you want the full package but...

Inventory levels drastically came down
Detached home prices are up 4% from February
Active listings remain high granted many of them are stale while there were over 500 more sales in March than there was in Feb.
Homes are spending 11 more days on the market compared to this time last year.

29 year average increase in Calgary residential sales is 6.73% .... far from falling off a cliff type of growth IMO.

Dont get me wrong... it is not all peachy out there and I know a ton of people have lost or will lose jobs but re reading some posts in this thread..... we have a long ways to go to reach a 30% decrease in housing values......very long.

Inventory is up 87%
Sales are down 28%

March sales are always higher than february. Why even bring that up?

Where is the suprisingly good news? Surely can't be the sales being down 51% so far this month.


http://www.creb.com/Seller_Resources...ng_Statistics/

[calgarygeologist]

Originally Posted by Red

Where is the suprisingly good news? Surely can't be the sales being down 51% so far this month.


http://www.creb.com/Seller_Resources...ng_Statistics/

Don't bother looking at the numbers for this month yet. It has only been a week and half of that week has been the Easter long weekend. It should be a surprise that business was slow during the holiday.

[rd_aaron]

Originally Posted by Realtor 1

29 year average increase in Calgary residential sales is 6.73% .... far from falling off a cliff type of growth IMO.

This is a really weird stat to post. 29 years? That's like saying the S&P 500 grew at an average of 12.6% between Jan 1, 1979 and Dec 31, 2008. While true, if someone told you this in 2008, it's really not painting an accurate representation of the current market conditions (S&P 500 lost 37% from Jan 1, 2008 to Dec 31, 2008).

http://www.moneychimp.com/features/market_cagr.htm

[Kavvy]

Originally Posted by rd_aaron

This is a really weird stat to post. 29 years? That's like saying the S&P 500 grew at an average of 12.6% between Jan 1, 1979 and Dec 31, 2008. While true, if someone told you this in 2008, it's really not painting an accurate representation of the current market conditions (S&P 500 lost 37% from Jan 1, 2008 to Dec 31, 2008).

http://www.moneychimp.com/features/market_cagr.htm

I am still trying to figure out what he means by "Inventory levels drastically came down" when Active listings are the highest since 2012, and increased every month in 2015.

I think he means the active listings increase per month for the month of March has significantly been reduced compared to February, but the way he phrased it is concerning to to me considering the message of his post.

[Red]

Originally Posted by calgarygeologist

Don't bother looking at the numbers for this month yet. It has only been a week and half of that week has been the Easter long weekend. It should be a surprise that business was slow during the holiday.

True, but it will still end up 30% down when all said and done.

[Kavvy]

Originally Posted by rd_aaron

This is a really weird stat to post. 29 years? That's like saying the S&P 500 grew at an average of 12.6% between Jan 1, 1979 and Dec 31, 2008. While true, if someone told you this in 2008, it's really not painting an accurate representation of the current market conditions (S&P 500 lost 37% from Jan 1, 2008 to Dec 31, 2008).

http://www.moneychimp.com/features/market_cagr.htm

So I think I understand why he posted this. He is trying to show that the total sales is actually up compared to historical values, whereas if prices were about to take a downturn, total sales should be down (the more sales, the more it drives prices up).

But it is a horribly skewed stat, almost guaranteed to show a "positive real estate market" no matter the conditions for two reasons:

1. ooo edit - my bad, he did take an average - didn't read, but I still think point 2 holds as the average will be yanked down by a previous total population

2. This value ignores population and inventory growth. As the city grows, this number needs to go up in order to just maintain prices. A very rough correlation would say that was population increases, this number needs to increase by the same percentage to maintain prices. Since population has increased by a whole lot more then 6.73 % in the last 29 years, I would argue that this stat actually shows quite the bearish market coming this summer.

[rd_aaron]

Originally Posted by Kavvy

I am still trying to figure out what he means by "Inventory levels drastically came down" when Active listings are the highest since 2012, and increased every month in 2015.

I think he means the active listings increase per month for the month of March has significantly been reduced compared to February, but the way he phrased it is concerning to to me considering the message of his post.

Inventory is active listings divided by sales I believe, so:

Feb 2015:
Active Listings = 5329
Total Sales = 1217
Inventory = 4.38 months of inventory

Mar 2015:
Active Listings = 5693
Total Sales = 1747
Inventory = 3.26 months of inventory

So inventory has come down quite a bit from Feb 2015 to March 2015, but is still way over March 2014 inventory (1.24 months of inventory).

[Red]

Originally Posted by Kavvy

So I think I understand why he posted this. He is trying to show that the total sales is actually up compared to historical values, whereas if prices were about to take a downturn, total sales should be down (the more sales, the more it drives prices up).

But it is a horribly skewed stat, almost guaranteed to show a "positive real estate market" no matter the conditions for two reasons:

1. He should of taken the average total sales over the last 29 years, not just the value from 29 years ago compared to today

2. This value ignores population and inventory growth. As the city grows, this number needs to go up in order to just maintain prices. A very rough correlation would say that was population increases, this number needs to increase by the same percentage to maintain prices. Since population has increased by a whole lot more then 6.73 % in the last 29 years, I would argue that this stat actually shows quite the bearish market coming this summer.

Pretty clear that he is cherrypicking stats to misrepresent the overall market.
In the end we just need to look at two things, sales and inventory. Supply and demand. Both are trending in the wrong direction. Market will adjust accordingly.
All these other tidbits like home prices up from a month ago are irrelevant. They just show that marginal buyers (first timers) were outnumbered by more well to do ones. Is that a good thing?

How many vacant homes on the market? About 25%. That's the scariest stat of them all. Musical chairs gone wrong.

[Travis Munroe]

Originally Posted by Red

Pretty clear that he is cherrypicking stats to misrepresent the overall market.
In the end we just need to look at two things, sales and inventory. Supply and demand. Both are trending in the wrong direction. Market will adjust accordingly.
All these other tidbits like home prices up from a month ago are irrelevant. They just show that marginal buyers (first timers) were outnumbered by more well to do ones. Is that a good thing?

How many vacant homes on the market? About 25%. That's the scariest stat of them all. Musical chairs gone wrong.

Edit: deleting my post as its not worth my time. Your post had 0 relevance and used the most ridiculous stat possible yet you found a way to say I (the guy I hire) cherry pick stats.

[Kavvy]

Originally Posted by Realtor 1

Edit: deleting my post as its not worth my time. Your post had 0 relevance and used the most ridiculous stat possible yet you found a way to say I (the guy I hire) cherry pick stats.

Would you respond to my post about the 29 year stat?

The inventory one I understand now, don't need a response!

[Red]

Originally Posted by Realtor 1

Edit: deleting my post as its not worth my time. Your post had 0 relevance and used the most ridiculous stat possible yet you found a way to say I (the guy I hire) cherry pick stats.

Well, that's disappointing. I am sure I am not the only one itching to find out why sales stats from the 80s when our population was 50% lower is more relevant than current sales, inventory and occupancy status of said inventory.

[Travis Munroe]

I am referring to your comment on vacancy levels and how it might be one of the least accurate stats available.

Kavvy - Inventory was down from the previous month ... it was spiking at a very fast rate and really pulled back putting us in a balanced market.