Calgary broke owner says housing sales are down from last year
Calgary’s once consistently booming housing market is feeling the ebb and flow of oil prices as home sales dropped by 37 per cent in comparison to last year.
“Is our market slower than it was last year at this time?” asked Lowell Martens, broker owner of Remax Real Estate Mountain View. “That goes without saying, but what we have noticed is an extreme amount of interest on the part of consumers.”
Open houses have been packed, investors are scouring the markets for good deals and many Calgarians are seeking mortgage brokers to pre-qualify them so that they can be prepared to make a move when the time comes, the agent who has been in the industry for 39 years explained.
“Nine hundred and sixty one sales [up to] Feb. 24 for the month, went to 1,011 as of today [Feb. 25] and our day isn’t even over yet. Our sales are starting to show that they’re picking up again, but in comparison to last year they are still lower,” Martens said. Last year February, sales at this time were sitting at 1,591.
“But not everyone is buying,” he said, noting that many are waiting because they are interested in seeing what the market does first.
Old houses are being torn down for new infills throughout S.W. neighbourhoods such as Glenbrook. Prices are going for as much as $700,000. However, home owners are having to lower the price to convince buyers to make a move.
Photo by Caitlin Clow.
Martens said he’s noticed that the market in the Calgary area is quite balanced, despite the uncertainty of the price of oil.
“Last year we maintained just under 5,000 listings for the whole year, we couldn’t break it,” Martens said, explaining that a balanced market is considered to be 5,000 listings. “This year, we’ve actually exceeded that.”
“Now is that good or bad?” Martens asked. A balanced market demonstrates that both buyers and sellers are on equal ground, he explained.
The desire to own real estate is undeniably strong, Martens said. Now it’s just a matter of when to buy.
“Maybe now is not a bad time to look at buying,” he said. During other recessions, Marten noticed that they couldn’t get anyone into an open house, but now during this downturn, there is a lot of activity on properties.
Meanwhile, for those who are selling, it can be quite frustrating in a buyer’s market, said 30-year-old Justin Poonwah.
Poonwah’s townhouse near Southcentre Mall has been on the market for over a month, but he said he’s seen a lot of interest.
“How do you know when a market bottoms out — when it starts going back up again? That means that you missed it.”
-Lowell Martens, broker owner at RemaxHis place was listed at $329,000 and he had to reduce that price to $299.000.
“It’s frustrating for me because the pressure is so high and I’ve already dropped the house by $30,000,” Poonwah said.
Poonwah said he expects that prices will continue to drop until sellers decide to pull their houses off the market due to lack of profit, so buyers should start snapping up deals when they see them.
“The prices of gas is already almost back to where they were before and the housing market will follow,” Poonwah said, “it’s always a month or two behind.”
“Back to economics 101: supply and demand,” Martens said, “if people can’t afford it they won’t buy and that creates a supply and then prices get adjusted and it all comes back again.”
Last year the market experienced a 7 per cent price increase and Martens explained that this year, “we’re just gaining it back. Question is are we going to get any more back?”
The time to buy, Martens explained, is when that supply is too high. When the listing counts increase dramatically that is when the most significant price adjustments will be made.
For sale signs are sprinkling the lawns in Glenbrook S.W. and in many neighbourhoods across the city.
Photo by Caitlin Clow.“There are so many mixed messages, predictions and speculative stuff going on, but that’s all it is—speculation,” Martens said. “In the long run, I’m not the least bit concerned about this, really.”
“We always have those buyers that are waiting for the market to bottom out, but the problem is how do you know when a market bottoms out?” Martens said. “When it starts going back up again, that means that you missed it.”
cclow@cjournal.ca