For the first half of 2013 Calgary was leading the country in the real estate market - high quality (and diverse) listings, average selling price, number of days on the market - and we were continuing to grow upward. Many people are now wondering what impact the massive and destructive flooding southern Alberta experienced last week will do to the housing market in Calgary and if our numbers will continue to lead the nation for the second half of the year.
There were over 700 MLS listings in Calgary that were affected by the flooding waters from the Bow and Elbow rivers, that is nearly 12% of the current market. While it is uncertain how many of these homes actually suffered physical damage, the areas in which they are located were all severely impacted. This has left many buyers anxious about potential price increases and decreased options.
“We would expect in the short term you’re going to see some listings drop, especially in the areas that were impacted. That’s a natural reaction to it,” said Ann-Marie Lurie, chief economist at the Calgary Real Estate Board. “As far as demand goes, it can actually shift demand to other areas as the listings drop off. People might start considering other communities.”
In addition to the potential shift caused by homes impacted by the flood that were already listed in the MLS system, we may see a drop in new listings as homeowners in the impacted areas hold off on their plans to sell or purchase a new home as they focus on rebuilding. After a traumatic event like the massive Calgary flood, many people will re-evaluate their lives and housing choices. This is expected to drive more buyers to new communities that were not affected by the floods and that have available inventory to sell on new lots.
For the nearly 200 homes that were purchased in heavily flood impacted areas in the last 30 days, buyers that have not yet taken possession are being advised to consult with their real estate agents and real estate lawyers. Each case will need to be addressed and evaluated on an individual basis as many properties are no longer in “substantially the same condition” as outlined in the purchase contract.
One thing is certain, the people of this amazing city have shown once again why Calgary is such an incredible place to call home. We are deeply grateful for the overwhelming efforts from volunteers, our public servants (police, fire, emergency, and government men and women), local businesses, and people opening their homes to help people in need. It is an honour to live and work in this city every day.
Calgary’s Mortgage Broker