Wednesday, December 11, 2019 / by Sergey Korostensky
CALGARY — The Calgary area real estate market saw a quiet start to 2019 with a decline of 26 per cent in overall activity compared to the first half of 2018, according to the Calgary Flash Report 2019.
The report, released recently by Altus Group, found there were bright spots for the Calgary Market Area, specifically with the apartment sector more than doubling and the industrial sector increasing by 24 per cent.
However, the gains were not enough to offset significantly lower transaction volumes for office and residential.
In 2018, Calgary’s total investment property sales transactions reached almost $3.7 million, up 15 per cent year-over-year.
The report found:
- While residential land investment picked up in 2018, increasing 17 per cent from 2017, investment totals were down 57 per cent in the first half of 2019 with lower volumes for all land use categories.
- The industrial sector saw almost 3.7 million square feet of new space completed in the four quarters ending in Q2 2019, following less than 500,000 square feet completed in the previous 12-month period. The increased new supply contributed to an upturn in the vacancy rate to seven per cent at the end of Q2 2019.
- The office sector continues to deal with an oversupply of vacant space, with Calgary having the highest vacancy rate among the major markets in Canada (above 20 per cent). With little supply added in the past 12 months, the vacancy rate has started to decline.
- Total new multi-family home sales pushed higher again in 2018, although the gains were modest. Total sales reached almost 3,100 units, a 3.5 per cent increase. The improvement was all on the townhouse side, as new condo apartment sales dipped, however Q2 sales in 2019 did much better than Q1 sales, ending the declining trend over the previous four quarters.
- The new condo apartment sector inventory deteriorated further over the past year resulting in approximately 2,700 unsold units in active new condo apartment projects at the end of Q2 2019.
- Home buying intentions were promising in summer 2019 compared to a year earlier driven by current renters who are the primary pool for potential first-time buyers.