Calgary home prices are set to drop 3.4% in 2016, according to the annual forecast from the Calgary Real Estate Board.
Low sales activity and an increase in supply will continue to depress Calgary’s housing market this year and drop the benchmark price of a home to $438,652.
“As we move into the second year of this environment, we expect to see additional housing supply pressure and further price declines,” said CREB chief economist Ann-Marie Lurie. “Weakness in the energy sector is overshadowing all aspects of our economy and with more people looking for work and fewer opportunities, we could see some families making adjustments to their housing situation.”
A near record high number of multi-family housing units are currently under construction, which will cause steeper price declines in that sector than others.
“The main risk to the housing outlook lies with the deepness of the pullback in demand and how that will translate into supply gains,” said Lurie. “Any sign of sustained recovery in the energy sector could limit the impact on the housing market.”