Calgary repeat home sales see prices fall

CALGARY — House prices in Calgary for repeat home sales dipped slightly in January in line with a trend across the country.

The Teranet-National Bank National Composite House Price index, released Wednesday, said prices in Calgary were down 0.1 per cent from the previous month and nationally they were down 0.3 per cent, the fifth consecutive monthly decline.

For Calgary, it was the second consecutive month of decline. The index is estimated by tracking observed or registered home prices over time using data collected from public land registries. All dwellings that have been sold at least twice are considered in the calculation of the index.

While prices dropped on a monthly basis, they showed an increased year-over-year.
Calgary prices jumped by 4.3 per cent compared with a year ago while the national scene, which tracks 11 cities, showed a 2.7 per cent hike.

However, the annual increase nationally was the smallest 12-month gain since November 2009. For the Canadian index, January was the 14th straight month of deceleration in 12-month inflation.
In six of the 11 metropolitan markets surveyed for the index, the 12-month rise exceeded the cross-country average in January: Halifax (6.6 per cent), Quebec City (6.0 per cent), Hamilton (5.9 per cent), Toronto (5.3 per cent), Calgary (4.3 per cent) and Winnipeg (3.4 per cent). Ottawa-Gatineau matched the average (2.7 per cent). Lagging it were Montreal (2.6 per cent), Edmonton (2.0 per cent) and Victoria (1.1 per cent). Prices in Vancouver were down 2.5 per cent from a year earlier, for a sixth month of 12-month deflation.

Prices were down from the month before in seven markets in Canada including Calgary: Vancouver (0.8 per cent); Edmonton (0.7 per cent); Toronto (0.4); Winnipeg (0.3 per cent); Montreal (0.2 per cent); and Hamilton (1.1 per cent).

Prices were up 1.4 per cent on the month in Quebec City and Victoria, 1.7 per cent in Halifax and 0.5 per cent in Ottawa-Gatineau.

David Madani, economist in Canada for Capital Economics, said national home prices have been in decline for five consecutive months and “we anticipate further declines this year, as potential buyers are scared off by the prospect of capital losses.”

“We stand by our view that house prices will decline by 25 per cent over the longer-term,” he said.
“Canada’s overall composite house price index has declined in a manner broadly consistent with the softening existing sales-to-listings ratio. We expect this key metric to decline further this year. As we move into the spring we doubt that ultra low mortgage rates will attract an influx of home buyers, especially now that mortgage rules have been tightened more noticeably for first-time buyers and house prices have begun to adjust downward from historically high levels.”