What happened in April

A spike in new listings led to a dramatic rise in first-time buyers in April. Bidding wars are at their highest level in years. Over the past 3 days, 24% of homes sold for list price or higher. With new listings up 5%, I would have expected to see a drop in the median price, but the pent-up demand from buyers kept sales and prices up there. When 24% of homes are selling for list price or higher, you can be assured that inventory levels are not making for a healthy market. Let’s hope for a surge in new listings in May. You can see a more comprehensive update on my Monthly stats update.

Inventory vs sales and price

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4 responses to “What happened in April

  1. For the city of Calgary, combined SFH and condos, sales in April were up 8.3% compared to last year. If you remember last month, these numbers were down and some pundits were signalling it as the beginning of the end in cowtown.

    What are the chances that we’ll hear from him this month? So-called experts with an agenda who know very little about the dynamics of the Calgary market should just stay quiet, but as Garth Turner likes to say, fear sells.

    I’d prefer to see an end to the inventory shortage. That will allow prices to drop, and give buyers a decent selection of homes to choose from.

  2. Bob, are there any general reasons for why inventory may be low? Or is it just one of those things that can’t really be explained? I had expected that the spring months would lead to much more people selling their houses, but maybe it’s still early. Either way, it’s pretty interesting. Thanks for the stats as usual.

    I was asked a similar question about a month ago and here’s the answer I gave:

    “…over the past 10 months Calgary has experienced an influx of people moving here for employment who all require a place to live.

    As counter-intuitive as it sounds, low inventory combined with increasing prices prevents prospective sellers from listing their homes. If you are a move-up buyer, you’ll be worried about selling your home because you won’t know whether there will be a house to buy. The same applies to someone who is moving across town in order to get closer to work or schools, so you wait it out.

    With an influx of new residents comes a tight rental market, so more prospective sellers become landlords. This cuts into inventory.

    Market forces will eventually resolve this situation. Higher prices will prevent buyers from entering the market, listings will stay on the market longer, and inventory will build. More new homes will be built. A downturn in the economy with lay-offs will motivate people to sell and leave this city. In time, the inventory will increase to healthier levels.” -Bob

  3. Calgary sets record benchmark price in April

    “The benchmark price of single-family homes in the city reached a new high of $452,900 in April, as market conditions that favour the seller finally drove prices above the unadjusted peak in 2007”

    Read more:
    http://www.calgaryherald.com/business/Calgary+real+estate+market+continues+climb/8320751/story.html

  4. Hi Bob,
    The total sales of SFH month to May 30/2012 was 1630 and average price was $503013 according to CREB website, while your website shows 1713 and $501973 for the month of May last year. I am just wondering what caused this noticeable discrepancy. Thank you.

    My stats are showing the full month, ie, May 1 -31. -Bob

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