In Calgary, Canada’s fourth largest city, everything is just a little bit different. When the rest of the country is in a slump, Cowtown is often on the rise. Same goes for real estate: our western powerhouse dances to its own drummer in the housing market. Seeing as Alberta as a whole will experience an increase of 19 per cent in housing starts (new builds) this year (according to CMHC’s Prairie Housing Outlook Report) , it’s safe to say something’s up in wild rose country.
Examining A Growing Economy
Like the rest of the nation, the economic downturn definitely made its mark on oil and gas dependent Calgary. 2010 was a particularly rocky year – but things have since leapt dramatically. While unemployment sat at 7.7 per cent in May 2010, it’s under 5 per cent now.
Earlier this year, the Conference Board of Canada announced Calgary would have the second fastest growing economy in the country at 3.6 per cent, trailing Saskatoon. The latest estimates say the city’s real GDP growth should surpass 5 per cent. On top of this, the city has the highest income per capita in Canada.
Confronting Suburban Sprawl
Calgary’s mayor Naheed Nenshi came into office in 2010 with a promise to curb the city’s legendary sprawl — reportedly the worst in the country. Under a document called Plan It Calgary, the city is working to increase density, especially in the city centre, to accommodate the fact that the city is expecting to double its population over the next 50 years.
A premium on developers in suburban lands that will add as much as $10,000 to the price of a home is further incentive to stick close to the Core. As a result, projects like the Shawnee Park subdivision in the southwestern part of the city are coming in. They’re trying to link to transit, provide walkable streets and increase density. These perks will come at a price for homeowners, as will developers’ efforts to get city approvals to build.
An Uptick in Housing Prices
Looking at prices alone, the city is clearly going through some good times. The latest numbers show that housing sales and prices are up, up, up! Sales have increased 7 per cent from last spring, and the average home price is up more than 5 per cent from 2011. Now, the average home price in Calgary sits at $440,421 — still a deal compared to Toronto and Vancouver, but considered high for this landlocked town.Still, this demand continues to be supported by a strong provincial economy, low mortgage rates, and full-time employment growth.
Sales of condo townhouses are up while apartments are down, but prices for both have been on an upswing.
Addressing An Uneven Market
Calgary’s housing market, like everything else about the city, has its quirks. There’s scant supply in the entry level market; a problem housing observers say developers are trying to remedy with new builds at lower price points. Meanwhile, there’s an oversupply of high-end homes over $1 million.
In March, when condo units went up for sale in the city’s promised 44-storey tower in the East Village, prospective buyers lined up and even camped overnight to get the chance to buy.
Meanwhile, agents report more pricey homes, particularly those that need work, sitting on the market.
A Boomin’ Good Time
Calgary is a magnet for jobs, and demand in the oil and gas and entrepreneurial industries aren’t going anywhere. All predictions look to a market that will stay hot and a city that hasn’t seen the last of its boom years.