Much has been made of the way how the decline in the oil industry has combined with the economic downturn of COVID to make Alberta doubly hardly hit with a battered economy compared to the rest of Canada. In fact there was an article today that stated how commercial office space in Cowtown may reach up to 30% vacancy rates before long. This of course isn’t good news, as the oil and gas industry has been a major contributor to Canada’s federal coffers for many, many decades now.
Despite all of this, however, there is actually still a net inflow of new residents to the city, and that in part may be because new home prices in Calgary are significantly lower than other major metro areas in the country and there continues to be good work opportunities for people who are new to Canada too. So there’s something of an opposing forces situation here, and it’s creating for what experts call a sideways real estate market.
One that’s not going up, or going down. Instead, it’s going sideways and you’re free to imagine that to the left or right. Whichever’s to your fancy. But what needs to be known here is that if you’re a realtor in Calgary or the surrounding communities one of the best things you can offer to prospective new clients is real genuine knowledge about the changing market and where they might be best investing in it. But of course you need to make those people into your clients before impressing this way, and that’s why our online real estate lead generation system for Canadian realtors is as highly recommended as it is.
But let’s get back to topic, and spell out a little more of what might be on the horizon for residential real estate in Calgary this year.
More Resilient Than You Might Think
Calgary’s housing market followed the rest of the country’s lead during the second half of 2020 in defying the detrimental economic effects of the COVID-19 pandemic, and it turns out that it looks like it’s going to stay fairly resilient for this year.
Local economists and real estate experts are saying thatsome of the momentum recorded at the end of 2020 will continue into 2021, and much of that will be fueled by exceptionally low lending rates and something we’ve talked about at length and is a very real thing – pent up demand.
Sales are expected to rise some 5% on an annual basis in 2021, and the inflow of new residents to Calgary that we talked about early would make this number even higher if these persistent economic challenges growing out of COVID weren’t the factor that they are.
So while it’s true that Calgary is currently saddled with record-high unemployment and that’s on top of the fallout of the oil and gas sector’s downturn in 2014. However, Calgary’s housing market performed above expectations in the second half of last year. So all things considered – a 5% rise won’t be so bad all in all.
Flat is OK – For Now
Even if the Calgary real estate market only stays flat, that’s still a very positive outcome considering what was forecasted to happen to prices in the city. Naturally, homeowners there have the same interest in their equity as Canadians elsewhere do. One thing that has been beneficial is how few listings and low inventory on the market have buoyed it somewhat.
This also might be what’s prevented prices from decreasing in a city that was struggling with joblessness even before the pandemic triggered lockdowns across the country starting about nearly one year ago. If people are selling homes because the homes are priced properly, then there’s reason for optimism and Calgary real estate experts say this is currently the same situation for the most part.
It’s also true, however, that more than a few homeowners are selling their houses for less than they paid for them, and especially if they bought them before 2014. Homes can be found for under $600,000-700,000, but it’s about listings and supply keeping the market relatively balanced. That’s the work of interest rates for the most part.
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