Calgary's housing market is on its way to recovery, the Calgary Real Estate Board (CREB) said Tuesday, as housing inventory levels begin to stabilize later this year.
The Calgary Real Estate Board expects sellers will likely see an increase in the value of homes toward the second half of 2011. (CBC News)
The board said in its 2011 forecast that low interest rates, unprecedented affordability and a large selection of inventory are expected to come together sparking a return to a more balanced and sustainable housing market.
"This could be great news for those homebuyers who have been putting off purchasing in Calgary for fear that homes may still decrease in price," CREB President Sano Stante said in a release. "2011 will offer buyers the convergence of unprecedented affordability, low interest rates and a large selection of inventory."
According to the forecast, sellers will likely see an increase in value toward the second half of 2011. The board sees the sale of existing single-family homes rising 19.9 per cent to 14,500 this year, with condominium sales up 15.8 per cent at 6,000 units. Sales of townhouses are expected to rise 13.5 per cent to 4,000 units.
Meanwhile, the price of a single family home is seen rising 4.1 per cent to $480,000, the price for a condominium is expected to climb 1.8 per cent to $295,900, while the price for a townhouse is seen rising 2.6 per cent to $368,500.
Construction of single family homes is expected to jump 7 per cent or 6,000 units, while multi-family homes are seen climbing 11 per cent or 4,000 units.
Green homes in walkable, mixed-use, sustainable communities will be popular this year, because of a marked shortage of these units, the board said.
"New market segments have emerged - homebuyers who choose to be more financially and environmentally conservative, drive less, and live in walkable communities," Stante said. "Buyers will now begin to look for less conventional homes that accommodate evolving lifestyles, aging parents, home offices, telecommuting and, at the same time, offer access to a diversity of community and cultural amenities."
On Monday, Federal Finance Minister Jim Flaherty unveiled tighter mortgage rules to staunch concerns over high Canadian household debt. The changes included lowering to 30 years from 35 years the maximum amortization period for a government-insured mortgage, dropping the upper limit which Canadians can borrow against their home equity to 85 per cent from 90 per cent, while government insurance backing on home equity lines of credit, or HELOCs was removed.
Earlier Tuesday, The Bank of Canada also elected to hold its benchmark overnight lending rate steady at one per cent in its latest policy statement.
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