Time to buy real estate in Calgary?

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CALGARY – Average house prices in Canada dropped by 3.6 per cent in July compared with a year ago, led by declines of eight per cent in Calgary and five per cent in Edmonton, according to a report released today by the Canadian Real Estate Association.

CREA’s report said the average national MLS residential sale price last month was $327,020 while in Calgary it was $402,788 and in Edmonton it was $335,100.

MLS sales dropped by 10.9 per cent in Canada in July. In Calgary, sales were down 13.1 per cent compared with July 2007, according to the CREA report.

A group of for sales signs lined up along the street on Country Village Landing N.E.
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Font:****”Mounting consumer caution” prompted the national decline in existing home sales and the “steady drum-beat of double-digit sales declines” this year is beginning to “weight more heavily on prices,” said Douglas Porter, deputy chief economist with BMO Capital Markets Economics in a commentary on the CREA numbers.

“Canada’s housing market is running into some seriously foul weather amid the weakest affordability in nearly two decades,” wrote Porter in his analysis. “We opined a month ago that ‘given the steep run-up in new listings, double-digit sales declines and the sharp drop in consumer sentiment, price declines may become a more common feature across the country in the months ahead’. These latest figures simply pound home that point. While we still doubt that Canada will stage an instant replay of the trauma in U.S. markets, even a mild version would be bad news.”

Year-to-date until the end of July, existing home sales in the country are down 13 per cent from the same period a year ago. Calgary leads the country with a 30.1 per cent decrease in sales followed by Greater Vancouver at 24.0 per cent and Edmonton at 23.0 per cent. Nationally, the average sale price is up 2.2 per cent year-to-date to $338,586.

In Calgary, the year-to-date average sale price is down by 0.1 per cent to $414,213.

“The combination of a larger inventory of homes for sale and fewer home sales means less upward pressure on home prices in many markets,” said Calvin Lindberg, CREA president. “The challenge for many sellers is determining the right price for today’s market conditions. There is no doubt the Canadian real estate market is pulling back from the record sales and price increase levels of 2007.”

Porter said that “pricing power is in full-scale retreat across many major markets.”

Source: mtoneguzzi@theherald.canwest.com, Calgary Herald.

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