Toronto home prices are up 15 per cent in a year, and in Vancouver they spiked 30 per cent with no sign of stopping, according to a Bank of Canada report released Thursday. The data prompted Canada’s central bank to issue a warning: buyer beware.
The story is different in Calgary, where falling oil prices and layoffs have already taken their toll on home prices, which are down about three per cent over the past year, according to the local real estate board.
With energy holding at around $50 a barrel, home buyers in the southern Alberta city can expect more gain than pain.
“With oil prices starting to improve, at least it should stabilize out market,” Calgary Real Estate Board economist Anne Marie Lurie said. “We should stop seeing some of that dramatic fall in employment, but there is a period of lag. And this really is almost consistent with what we would expect in a normal economic cycle.”
Calgary office towers are a different story, with reports suggesting the vacancy rate is up over 20 per cent.
But some analysts predict it won’t be getting much worse.
“We are about six months from the bottom–sometime in the next six months in the commercial market–and then we will start to see a very slow but steady pickup in the market,” Aspen Properties’ Scott Hutcheson said.
The message? As long as oil prices do not drop, the market in Calgary should not drop.
The general consensus is that Calgary housing prices should continue to tread water this year, and the commercial market should recover next year.