I recently had a friend of mine (and past client) reach out to me for an update on the condo market in Calgary. They had been seeing various bits of information in media and wanted to know how to proceed with their condo. Should they sell it or continue to rent it. Here is the email I sent to her:
With all of the media coverage on the real estate market sometimes it's hard to identify what is realistic and what isn't. I had a great chat with Ann-Marie Lurie, the Chief Economist at the Calgary Real Estate Board and was able to gather some great information.
Overall, there is no rush to sell your condo. Right now condo prices are still recovering from the peak pricing we saw in 2007. The good news is that we are well on our way to a full recovery and the average price (year to date) has increased about 6% over last year's prices. That increase is for all types of condos so it's an overall number.
There are a number of reasons the condo market is good right now. The first is the strong net migration into the city (it hasn't been this high since 2006), when people move here they need somewhere to live.
Finding a place to rent might seem like a good place for them to start but the rental market is very tight right now and interest rates are great so looking at buying a condo is the next option for people.
Condos are usually the first thing a new buyer will think of because they are generally more affordable than single family homes. Affordability combined with lower supply in homes under $400,000 continues to make condos a great option and the demand for them will not be easing anytime soon.
You also mentioned a concern about over saturation in the condo market. Most of the media coverage we are seeing on that topic is specifically about the condo market in the Toronto area. They have had a lot of new construction recently and that is where it is coming from. Although we are still having new construction of condos in our area there have been fewer "starts" this year compared to last year. Builders in this area haven't forgotten what happened in recent years when the market became over saturated with supply and don't want to relive that history.
To summarize the condo market, there is good growth, we are in a steady recovery and the market conditions are strong.
If you have questions about the various pockets of the market let us know, we are happy to answer questions for you and share our insight.
