Calgary: Cooling trend hits homes

Although the real estate market sprinted out of the 2007 gates with all the hunger and gusto of 2006, it couldn't keep up the manic pace, the Calgary Real Estate Board said yesterday as it looked back on the year that was.

In terms of real estate, the first half of 2007 seemed to have all the makings of another blistering year, with the average price of homes and the volume of sales reaching record values, said CREB president Ron Stanners.

To the benefit of the market, 2007 ended in a more moderate tone, he said.

"My colleague described 2006 as the perfect real estate storm, and he's right," said Stanners.

"In the beginning, 2007 tried to mimic 2006 but it couldn't do it."

Unprecedented labour demands, lack of inventory and a sudden increase in immigration sparked fever in the 2006 market and although residual effects were still being felt well into the summer, 2007 managed to settle down long enough in the fall to find a stable balance, said Stanners.

Sales during the first half of the year were higher year-over-year from 2006, with swelling median and average prices dominating the market, he said.

But in the end, the city's real estate sector behaved largely as predicted and closed the year at a more manageable level, he said.

"We anticipated that the market would grow and it did," said Stanners. "We anticipated that condos would increase their market share and they did.

"What we did not anticipate was that the average price in Calgary would surpass $500,000 and it did, but only for a short while."

Going into the new year, the market has reached a healthy, less-volatile stride, where sellers can get good returns on their investment and where buyers, thanks to increased inventory, can take their time looking for property, said Stanners.

"There's no panic to buy, as there was in 2006," he said.

"It looks like the number of sales will be down slightly this year from 2006, the market place cooled in terms of buyers and a number of people saw the median price cool off a bit and realized that they could afford to wait and that there was no rush."

Although down more than $50,000 from their high in the early summer, the average price of homes in Calgary is still higher, at more than $460,000, than this time last year. Year-end real estate figures for 2007 are expected to be tabulated before the new year.

By PABLO FERNANDEZ, SUN MEDIA