The Calgary housing market is expected to have another year of growth in 2014, with sales and prices going up, according to CREB®.
Sales growth in the city is expected to be 3.6 per cent and price growth is expected to increase 4.3 per cent, with strong migration levels over the past two years have combined with strong employment and wage growth to support further gains in sales next year.
Both sales and price growth exceeded our expectations in 2013. Stronger than expected demand was related to higher than expected migration and employment growth, while the tight rental market got tighter following the floods. Supply levels didn’t keep pace with rising demand, which pushed the market to favour sellers and created stronger than expected price growth.
Growth levels will ease from the double digit levels recorded this year, activity will remain above long term trends for the city.
As of November, the citywide benchmark price totaled $424,600, pushing above unadjusted previous highs. While not all communities have seen full price recovery, rising prices and tight market conditions have encouraged sellers to list their home.
Economic conditions continue to remain favourable in 2014. Tight market conditions will likely persist over the near term, but rising listings and increased competition from the new home sector should alleviate supply pressure and push the market toward more balanced conditions in the later part of 2014. Combined with potential increases in long term lending rates should take some of the steam off the exceptionally strong price growth of eight per cent, which we’ve recorded so far in 2013.
If market access issues persist for the energy sector, and further softening in global economic conditions continue, it would likely impact investment activity and employment opportunities. This affects confidence and ultimately housing demand. However, if there’s positive progress made regarding market access, it could boost consumer confidence and support stronger than expected housing growth.