Tortoise and hare finish seen for real estate recovery

Tortoise and hare finish seen for real estate recovery. Photograph by Dean Bicknell, Calgary Herald

Tortoise and hare finish seen for real estate recovery. Photograph by Dean Bicknell, Calgary Herald

Forecast predicts slow, steady gains Calgary market


CALGARY – The slow and steady recovery seen in 2009 numbers released by the Calgary Real Estate earlier this will through 2010, with modest gains of about three per cent in average resale homes, says Royal LePage.

In its monthly market forecast, the real estate company said including low inventory will keep prices in check this year.

“In January of 2009, the world was coming to an economic end,” explained Ted Zaharko, broker and owner of Royal LePage Foothills.

“So what we experienced was moderate growth . . . and I think it would be unrealistic to go with much more aggressive increase in 2010 because, are we completely out of this recession? I don’t think we are.”

Royal LePage’s quarter numbers show an increase of 2.3 per cent to $427,067 for Calgary’s average standard two-storey homes compared with the period in 2008.

Detached bungalows were up 0.5 per cent to $412,478 and condominiums fell by 0.4 per cent to $256,056.

Zaharko said the current inventory of 3,000 homes on the market means that buyers, who more typically have 10,000 homes to choose from, are having a tough time finding a good match.

“I think the cause is that people were holding back properties because there was no point in trying to sell your house if you think the world’s going to end,” he said, adding more optimism will bring more buyers into the

He said first-quarter 2010 statistics will show greater than three per cent price increases, but that’s in to what was a terrible first three months of 2009. The hike will level out as the year goes on.

Richard Cho, Calgary senior market analyst for Calgary for Mortgage and Housing Corp., said the agency’s forecast for 2010 is higher than Royal LePage’s, but only by couple of percentage points.

Where the realty company figures an overall average price of $398,000 per house, CMHC’s November forecast for 2010 is $403,000, or about five cent higher than 2009.

Cho said the statistic may sneak a bit higher in the new forecast CMHC is working now.

“The economy is showing more and more signs that things are improving and things are getting stronger. Employment growth is and that’s an important factor for housing demand.

“Looking at this year, we’re expecting to see higher levels of net migration. Also, there are lower mortgage rates for the first part of the year.”

Zaharko said relatively sales in the $1-million-plus market show that well-heeled buyers are confident prices will climb higher and are buying while bargains are still available.

Royal LePage said Canada’s residential real estate market will be unusually strong through the first half of 2010 as economic conditions across the country improve and the stimulus impact of low interest rates continues to stoke demand.

“The Canadian real estate market enters 2010 with considerable momentum from an unusually strong finish to the previous year,” Phil Soper, president and chief executive, said in a news release.

Regions that saw the strongest declines during the recession are now showing marked gains. Those regions include Toronto and the Lower Mainland of B.C.

© Copyright (c) The Calgary Herald