Weak demand, over-supply will drive down home prices in 2019: CREB
Calgary home prices are expected to fall by an average of 2.3 per cent in 2019, the Calgary Real Estate Board said Wednesday.
In its annual forecast event held at the BMO Centre, the organization said persistently weak demand and excess supply are expected to cause price declines this year of 2.27 per cent in the apartment sector, while detached home prices will decline by 2.33 per cent and attached homes by 2.49 per cent.
According to CREB, issues surrounding the price differential of oil, falling global energy prices and and a lack of pipeline access are affecting employment opportunities and consumer confidence in the city. In addition, stricter lending conditions and higher interest rates are also negatively affecting sales.
While resale sales activity is expected to remain low for the duration of 2019, CREB there are signs that the market is starting to adjust to slower sales. That should help reduce some oversupply in the market and put the industry in a more stable position by 2020, CREB said.
The sliding prices expected in 2019 are a continuation of an ongoing trend. The benchmark price for a detached home in Calgary declined 1.2 per cent year-over-year in 2018. It hit a low of $481,800 in December 2018, down from $521,600 in October 2014.