Calgary home prices took a dip in October, down 1.14% from the year before.
The year-over-year price change for home sales in Canada has been led by a steady growth in the red hot real estate markets of southern B.C. and Greater Toronto, according to new statistics released by the Canadian Real Estate Association, but show a decline in Calgary and other central Canada cities.
The national average sale price rose 8.3% between October 2014 and 2015, while Calgary’s dropped 1.14%
Elsewhere, the Greater Toronto region increased by 10.33% while nearby neighbour Ottawa only grew by a fraction at 0.54%.
Calgary’s decline was not as prominent as Saskatchewan cities Regina and Saskatoon, which took a 4.29% and 1.4% hit respectively. The benchmark home price in Calgary, at $448, 400, was also lower than the national average of $505,900.
The Vancouver and Toronto markets account for 70% of the nation’s growth, according to the CREA. If those markets were removed from the national analysis, the average home price would only be $339,059, rather than the current, and grown only 2.5%.
Elsewhere across the country has seen modest growth, including Montreal and Vancouver Island. Fancy a house in Moncton, New Brunswick? It may only set you back $157,300, but that’s already 7.1% higher than it was last October.
The disparity in home prices across the country is mostly due to economic struggles in the resource sector, according to Gregory Klump, the CREA’s chief economist.
“Local economies tied most closely to natural resource prices are experiencing weaker economic conditions compared to more diversified economies. Home price gains in Greater Vancouver and Greater Toronto reflect the balance between supply and demand – a balance which is among the tightest of Canada’s largest urban markets,” he said.
Low interest rates are also keeping Canada’s home sales afloat.
“The continuation of low interest rates is supporting home sales activity,” said Pauline Aunger, president at the CREA. “Even so, the strength of sales activity varies by location and price segment across Canada.”
Last month, the Calgary Real Estate Board’s president Corinne Lyall commented on the city’s slowing real estate market, saying that the apartment sector was a current hot spot for buyers.
The citywide inventory levels have stayed elevated when compared to the last three years, but Lyall recognizes that Calgary is still well below the highs during the previous 2008-09 economic downturn.
“There is no question that we have seen a shift in our local housing market conditions, but it needs to be put in perspective,” she said.
Calgary’s aggregate prices have had a “moderate correction” easing one per cent when compared to last years nine per cent aggregate price gain.