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Frank
N. McCullough
BBA,
M.Eng
ABR®
Associate Broker
403-542-1799
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Mitzy Molberg
Certified
Condo Specialist, ABR®
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Adev Ahluwalia
B.Sc.
Certified Condo Specialist, REALTOR®
403-701-6576
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FOR
SALE
Royal Birch
Wy NW
$535,000
SW Backyard on the
park; rock gardens, perennials, hot tub. 3
beds, 3.5 baths. 9' ceilings. Formal dining.
Kitchen exceptional w/ large island. Master
ensuite. Double attached garage.
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Calgary
Real Estate News
by Frank N. McCullough, BBA, M.Eng.
REALTOR May
2010
Edition # 41 |
| Dear
friend,
Calgary - End of April 2010:
April in Calgary has shown that our spring
market peaked in March as demand predictably
turned down with more stringent lending and
higher interest rates. Inventory has
continued growing and as I write on May
10th, it has reached over 10,000 active
listings.
Thanks to all of you who have chosen to
work with us and referred us on to your
friends. Our commitment is to give integrity
to our role as agents and always to act in
our clients' best interests. "Somebody
once said that in looking for people to
hire, you look for three qualities:
integrity, intelligence and energy. And if
they don't have the first, the other two
will kill you." - Warren Buffet
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| Graph
1 - No. of Avail. Listings at Month End |
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Supply
Analysis: Supply for April this
year is the second highest on record,
breaking through 2009 and appears to be
heading toward the highest supply year of
2008. We can say that there is no
shortage of property available. This
is important news for those who are moving
to Calgary, as the past upward trend in
prices will likely cool for a while.
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| Graph
2 - No. of Sales per Month |
Demand Analysis: The number
of sales in April has decreased from March,
a trend that was expected from both a
historical trend (notice the pattern of
declining or leveling off from March in
previous years) and because of more
rigorous mortgage lending practices
implemented in the middle of April. Add
to that mortgage interest rates being
pushed up by the banks, while the bank of
Canada rate remains at 0.25. Demand
is well below average, and it
is likely these downward pressures will
continue depressing demand in the
summer months, which tend to be slower than spring. We
do believe that the low overall demand will
not continue for a long time. While
other parts of Canada apparently have
had recent booms, Calgary has achieved only
modest growth. In our personal
experience, however, we are recently
noticing more people moving to
Calgary for employment.
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| Graph
3 - No. of Sales vs. Average Sale Price |
Price Analysis:
Average
and Median prices took a jump in March and
there is no accounting, except perhaps
those who were looking decided to buy
to take advantage of the lower
interest rates and the less stringent
rules for lending. This would
affect all markets from the first
timers to Million-plus, and combined
with the strongest part of the market
cycle, perhaps explains the increase.
April has seen return of the trend.
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| Analysis
and Opinion |
Lots of
information with strong trends: High
supply is continuing to grow into the
summer, demand is tapering off after a
not-so-spectacular spring of well
below average demand. Looks like
trouble for prices. We expect supply
to stay below that of 2008, and an
adjustment period over the next few months
while market participants react and
modify pricing to reflect the new reality
of the higher interest rates and
consequent lower affordability. That
said, we feel there is opportunity coming
in Calgary's market, as the already large
inventory going into this higher
interest rate period means the market
should adjust relatively quickly over the
next two months. This makes it a good
time for people moving to Calgary.
Until next time,
Frank & Mitzy
Copyright © May 10, 2010 Frank N.
McCullough
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