creb 2010 forecast (january 2010)

8/9/2019 CREB 2010 Forecast (January 2010)

1/18

Calgary real estate BoardCalgary and area Housing Market ForeCast 2010


2/18

2

F o r e c a s t H i g H l i g H t s

C m b cmc c.

em cm cmc i Ch h.

r m cmm b b cch C.

sb c m b cc m .

a us cm m h h h 2010.

C mm c m.

afb bc h m.

2010 h m bmmm h .

s m hm h mc c c c h .

C m b ,c m m.

sm hm c m c h.

l f c c fb h h m.

t able oF c on t en t s

FORECAST HIGHLIGHTS ................................................2

FROM SIZZLE TO FIZZLE ...............................................3

Capia marke capse e ramaic crrecin in 2009

BRIC by BRIC: Emerin markes wi ea recvery in 2010

Financia markes remain vaie in 2010

SLEEPING WITH A SICK ELEPHANT ................................5

Canaa ares beer bu a ain US ecnmyan a risin nie hampers recvery

Canaa mach US ineres raes r risk inain he Canaian ar

THE ENERGY TO RECOVER .............................................6

Abera si riven by i an as

Jb creain wi be epenen n majrprjec invesmen by business an vernmen

THE CALM AFTER THE BOOM ........................................7

Caarys prspecs wi epen n jbs an arabiiy

New Kis n he Bck: Yun amiies rive rwh

Bm, Baby, Bm: Invesrs have been impran acr in eman

FROM SIZZLE TO FIZZLE TO SIMMER .........................9

Caary husin eman recvers rm ramaic pu back 2008

Price ap beween resae an newhme prices impacs resaes an sars

A BALANCING ACT ......................................................10

Suppy eman baance wi enerae mes price rwh

CONDO CONUNDRUM .................................................11

Cn marke as in he ace seay invenry

Arabiiy wi bene cn marke aer in 2010

A SILVER LINING .........................................................12

Arabiiy vasy imprves an wi remain key marke rwh

Husin cs inex reecs perain cs escaain

Smaer cmmuniies usie Caary prvie an arabe pin

NEW TO THE NEIGHBOURHOOD ..................................14

Price an hme size rives cmmuniy rens

FORECAST SUMMARY .................................................16

ABOUT THE CALGARY REAL ESTATE BOARD ................ 17


3/18

C A l g A R Y R E A l E S t At E B o A R d | C A l g A R Y A N d A R E A H o U S I N g M A R K E t F o R E C A S t

FroM siZZle to FiZZle

Capital Market Collapse led to draMatiC CorreCtion in 2009

Whie si a reaive unknwn n he ba sae, here is n quesin ha Caary is

exremey ie wr ecnmies. Wr eman r enery makes Abera an Caary an

impran payer in he ba ecnmy an unubey he enery secr remains cenra

ca empymen. Cnsequeny, recasin aciviy r 2010 is paricuary chaenin as

wr markes are si reein rm he nancia mewn in 2008.

the sry he capia marke capse in Sepember 2008 is nw we knwn. tha capse

sen a ba ecnmies in a sharp crrecin aer a susaine peri srn rwh.

the new chaper in he sry is he rae ecnmic recvery: wh wi ea i an when wi iake rm h?

BriC By BriC: eMerging Markets will lead reCovery into 2010

Emerin markes Brazi, Russia, Inia an China (BRIC), wih are ppuains an an

appeie r Wesern s an echny rve he as rwh cyce. these same cunries,

namey China an Inia, wi cninue ea ba ecnmic recvery we in 2010

an beyn. Rapiy rwin ppuains wih mre auen cnsumers are creain new

eman r echny an aricuura prucs beyn heir curren mesic prucin

capabiiies. the unamena chane in eman srucures in hese ecnmies wi cninue

be an impran acr in 2010 an beyn. Many hese markes have as emere as

w cs prucers prucs isribue wrwie. grss dmesic Pruc (gdP) rwh

recass r hese emerin markes in 2010 an 2011 are expece remain we ahea

evepe nains.

0 2 4 6 8 10

Brazil

Russia

India

China

Hong Kong

UK

Australia

USA

Canada

Japan

GDP GROWTH FORECAST

20112010 Source: World Bank

(%)

g lo b a l c o n t e x t

2010in

BrieF

EMERGING THIRST

Emerin BRIC nains, wih areppuains an an appeie r

cnsumer s, raw maerias an i,

wi ea ecnmic recvery in 2010.


4/18

4

FinanCial Markets to reMain volatile into 2010

leain up he crrecin in 2008, he creaiviy new nancia insrumens an se

crei crieria uimaey ppe he capia markes arun he wr. the ams immeiae

ersin invesr cnence in nancia markes sen sck markes pummein. Wih

sck vaues ramaicay wer han asses, capia reserves uneryin he ba eb were

inaequae an many nancia insiuins were unabe cninue en in suppr

nin rae an prucin css.

Husin paye an impran par he previus rwh cyce an is uimae emise. this

was paricuary evien in he US where mrae equiy wihrawas primariy hme

equiy ans an cash-u renancins rew cnsieraby. In 2008, i became evien ha

much his eb was unsuppre by incmes r asses. Banks were unwiin r unabe

renance an recsures jumpe, especiay in Eurpe an he US.

gvernmens seppe in wih baius nancia insiuins an wer ineres raes, in an

er save cmpanies, prvie a back-sp mraes an a iquiiy he nancia

markes. Neverheess, jb sses were ineviabe an unempymen has cninue rise

hruh 2009.

Sck markes are he ms visibe inicar he reurn business cnence an win

a bmin in eary 2009, wr sck inices have rene upwar prviin much neee

capia r a reurn business rwh.

Nw, wih ineres raes w, invesrs have been cuse n equiy markes, cmmiies an

currencies wachin hese markes very csey an reacin even he sihes chane inecnmic inicars. As such nancia markes wi remain vaie in 2010.

30 60 90 120 150

BR (Bovespa)

Russia

India

China(Shanghai)

HK (Hang Seng)

UK (FTSE250)

AUS (ASX)

USA (DOW)

CDA (TSX)

JPN (Nikkei)

Source: advfm.co

GROWTH FROM TROUGH, GLOBAL STOCK INDEX

Non-BRIC Nat ions B RIC Nations

(%


5/18


sleePing WitH a sicK elePHant

Canada Fares Better But a lagging us eConoMyand a rising loonie HaMpers reCovery

thruhu he nancia crisis currency exchane raes have serve as a barmeer r

invesr cnence. the currency markes are anher imensin ha a cmpexiy

ecnmic recvery. the US ar has seen much wnwar pressure hruhu 2009 n

cncerns ha vernmen eb wi impee recvery. Jb sses in he US have swe bu he

US ecnmy has ye see new jbs bein creae.

traiinay, he US ecnmy has eermine Canaas ecnmic ae an, huh si rue,

Canaa has are beer ver 2009 han is suhern neihbur an many her evepenains. this can be creie in par a unamenay sun bankin sysem an mre

cnservaive crei picies which prvie sme insuain aains he ba nancia crisis.

Canaian banks have remaine we capiaize an an sses have been mre mes. Mre

receny, a rise in cmmiy prices has as cnribue Canaas recvery. Cnsequeny,

he Canaian ar wi cninue uperrm he US in he cmin mnhs an is expece

ren pariy in eary 2010.

Jb creain an cnsumer spenin is necessary r susaine ecnmic rwh an he

Bank Canaa, in he ner run, wans rive he Canaian ar wer.

the manuacurin secr in cenra Canaa has been hi har hampere by a risin nie

an ain US eman. the hih ar has as empere he rae invesmen in raw

maeria prucin. this currency siuain wi have a merain eec n ecnmic

recvery in he rs ha 2010 an, as he US ecnmy imprves in he secn ha he

year, marins wi suppr invesmen an empymen rwh. In he meanime, cnsumer

spenin in reai an husin is expece have a shr erm psiive impac.

Canada to MatCH us inte rest rates

or risk inFlating tHe Canadian dollar

Ineres raes have been he ms eecive in achievin esire exchane raes an have

been use in he pas manae inain. In he ace ecnmic weakness, he US is rce

keep ineres raes w an Canaa wi have mach US ineres raes r risk pushin he

Canaian ar up urher. the news is ha inain is bein we manae an his ses

a psiive envirnmen r 2010 gdP rwh in Canaa. on a cauinary ne, he Canaianvernmen wi be wachin cnsumer eb eves careuy. lw ineres raes an wer

prices wi rive mesic eman an cu emp cnsumers incur eb ha may be

unmanaeabe when ineres raes rise aer in 2010 an 2011. 2004 2005 2006 2007 2008 2009 2010

US PrimeCdn Prime Source: Bank of Canada

0

1

2

3

4

5

6

7

8

9

CANADA AND US PRIME

INTEREST R ATES

Forecas

(%)

2010in

BrieF

RECESSIONOMICS:

Whie 2009s recvery was iniiae by

vernmen baius, 2010s recverywi nee be riven by invesrs an

cnsumers. gba recvery shu

bui seam as he year prresses.


6/18

6

tHe ene rgY to recoVer

alBerta still driven By oil and gas

the Abera picure r 2010 an beyn is si abu enery. A n erm reainship

has been esabishe in Abera, an paricuary in Caary, beween i prices an a

empymen. Whie prices i an as rppe an wih wr eman urin he

recessin, his has areay prven be a shr erm phenmenn i prices are nw n he

rise uee by a rebun in emerin markes. gba i eman wi sar rw aain in

2010, abei raua. over he n erm prices are expece ren upwar as nie suppies

an emerin markes wi pu upwar pressure n prices. China wi becme a crucia payer

in ba enery markes as is sae-cnre i cmpanies k r new i suppies ue

he nains nin ecnmic expansin.

Naura as suppies are curreny siin in surpuses meanin ha new riin has been

ams nn-exisen in 2008 an 2009. N much is anicipae chane in 2010 an

cnsequeny invesmen an jb creain wi be unikey uni aer in 2010 when suppies are

expece cme wn.

the aiure vernmens reach an eecive cimae areemen in Cpenhaen a he en

2009 wi ake he pressure Aberas enery secr in he shr erm. Shiin epiics

wi cninue hamper avancemens in cimae chane iscussins in 2010.

overa 2010 is kin briher r he i an as secr, bu ain ecnmies in he US

an Eurpe wi preven i rm reachin pas heihs. Nneheess, prices wi ikey remain

abve oPECs are $75 a barre an wi ikey push beyn he $90 mark bere he

en he year.

JoB Creation will Be dependent on MaJor

proJeCt investMent By Business and governMent

the imprve uk r i wi re-simuae sme he prjecs eerre in ae 2008. As in

he pas, he bi invesmen penia is in i sans, inrasrucure, insiuina, an pwer.

the merain impac n vernmen invesmen in 2010 wi be he sae he Abera

eb. Jb creain in cnsrucin pubic inrasrucure prjecs wi be epenen n

vernmens wiinness inves wihu he hih i ryay revenues he pas. In ac,

pubic service jbs wi cninue be uner pressure an he vernmen wi k r ways

minimize is bueary eci.

Cnsumer cnence in n erm empymen prspecs an amiy incme wi eermine

he pace he husin marke. Whie new mirain Abera an Caary is an impran

inicar, eman r husin is as riven by he rae new huseh rmain. Yun

pepe eavin he amiy hme an rmin new husehs, as we as pepe n ner

wishin share accmmain wi be encurae by psiive prspecs in jbs, incme

securiy an arabiiy.

alb eR taS econoM Y

Source: EIA.DOE.GOV, Forecast Scotiabank

OIL AND NATURAL GAS PRICING

Natural Gas (Henry Hub)Oil (WTI)

$US/barrel

$US/Cubicfeet

2004 2005 2006 2007 2008 2009 2010Forecast

160

140

120

100

80

60

40

20

0

4

2

0

6

5.5

90

8

10

12

Forecasted percentage change in oil consumption

from 1980 to 2030.

Source: International Energy Agency

A DEVELOPING THIRST FOR OIL

+588%

Asia

+26%

US

-20%

Europe

2010in

BrieF

DRAGON ROARS:

China wi becme a crucia payer inba enery markes as is sae-

cnre i cmpanies k r

new i suppies ue he nainsnin ecnmic expansin.


7/18


tHe calM aFter tHe booM

Calgarys prospeCts will depend on JoBs and aFFordaBility

thruhu he previus rwh cyce, rapi raes huseh rmains cmbine

wih specuaive invesr eman pushe prices up an ere arabiiy in he Caary

husin marke.

Cnsequeny, Abera an Caary un i ifcu cmpee wih her areas Canaa

r permanen empyees. In he shr erm, jbs have been e wih emprary wrkers,

reece in mirain saisics as

cmpare jb rwh. the imprve

arabiiy in 2010 wi make jbs inAbera mre appeain an in-mirain

wi mre csey w jb creain.

this psiive uk r Abera ransaes

in news r Caary . Ppuain

rwh in Caary has been seay as

mirain r abur has arace wrkers

rm acrss Canaa an acrss Abera

he ciy. New Caarians have ene

be yuner han naina averaes an

cnsequeny naura ppuain rwh

has as been hih.

new kids on tHe BloCk:young FaMilies drive growtH

Yun amiies have been a sinican inuence n Caarys husin marke. Caarys

averae huseh size was 2.38 in 2006. Mre receny, his huseh size has increase

2.5 pepe per huseh ue arabiiy ersin an a hih rae naura increase.

Caary averae amiy incme is reaivey hih by cmparisn her areas Canaa,

especiay in cnsierain he w averae ae. A mre mbie emraphic in he 25-34

ae bracke has been arace Caary jb prspecs an he hiher incme jbs in nance,

cnsrucin an enineerin uee his rwh in pas years. the increase in 0-4 year s is

reecive he yun amiies an a key river he sarer hme eman seen in 2009.

Hiher prices in 2007 an 2008 cmbine wih ineres raes 50 per cen hiher han in 2009,

price sme yun amiies u he sine amiy wnership marke. this e such amiies

wih a maximum buyin pwer $250,000 whie averae sine amiy prices pushe we

in he $450,000 rane. Wih even mes incme rwh in 2009 an 2010, wer ineres

raes have enabe hese same amiies k a hmes in he $350-$375,000 rane, cser

averae marke prices.

c a l g a R Y S e c o n o M Y

2006 2007 2008 2009 2010

Source: CREB, City of Calgar

Median Family IncomWhat can I aord?

450,000

400,000

350,000

300,000

250,000

200,000

150,000

100,000

50,000

0

INCOME COMPARED TO BUYING POW

CITY OF CALGARY

72,00

71,00

70,00

69,00

68,00

67,00

66,00

65,00

64,00

63,00

Based on mortgage with 10% down payment, 1 year term, 35 yea

amortization. 2010 uses CMHC forecasted mortgage rat

PRICE OF OIL TO CALGARY EMPLOYMENT

Source: Stats CanadaOil Price Employment

0

20

2004 2005 2006 2007 2008 2009

40

60

80

100

120

140 210

205

200

195

190

185

180

175

170

Oil($US/barrel)

2010in

BrieF

NEW KIDS ON THE BLOCK:

Yun amiies an rs ime buyerswi cninue ue a recvery in

Caarys husin marke in 2010.

Wih even mes incme rwh in2009 an 2010, wer ineres raes

have enabe his chr k a

hmes in he $350-$375,000 rane,cser averae marke prices.


8/18

BooM, BaBy, BooM: investors Have Been iMportant FaCtor in deMand

As expece, he baby bmer ae rup (45-64) has as seen rapi rwh as he rwin ecnmy arace he experience an aen in

his chr. Caary has a hme wnership rae jus ver 70 per cen reecin a srn invesmen vaue pace n husin ver he pas ve

years. the invesmen inuence as cnribue price escaains in he pas severa years as bmers pu heir rwin equiy wrk r

hemseves an heir au chiren. In ac, price rwh rve hih eves specuain in husin wih repea saes cnribuin an aiina

10 per cen saes in 2006 an 2007. durin his peri, invesrs in Caary have as cnribue a sinican prprin nn-raiina

rena sck as buyers have purchase secn an hir hmes wih he inenin ainin equiy whie earnin rena incme. Invesrs wi be

ess a acr in 2010 as mre mes price rwh eiminaes he quick ains previus markes.

overBuilding ContriButed to oversupply and exaCerBated 2008 priCe reduCtions

Active Listings (Resale)New Single family Unabsorbed

2007 2008 2009

Source: CMHC, CREB

9000

8000

7000

6000

5000

4000

3000

2000

1000

0

1000

900

800

700

600

500

400

300

200

100

0

SingleFamilySupply(NewandResale)

S i l F i l C l t i

SINGLE FAMILY SUPPLY NEW AND RESALE

(Units)

Completions

200,000

180,000

160,000

140,000

120,000

100,000

80,000

60,000

40,000

20,000

0

0-4 5-14 15-19 20-24 25-34 35-44 45-54 55-64 65-74 75+

20062009 20012004

CALGARY POPULATION BY AGE GROUP

Source: City of Calgary

Neary 28,000 newy bui sine amiy

hmes were ae he marke rm

2006 he en 2009 cmpare

an esimae 30,000 new huseh

rmains. Neary 65 per cen hese

cmpeins were seen beween 2006 an

eary 2008. In ae 2008 an eary 2009,

wer resae prices pu pressure n new

hme csins as cusmers were reucan

accep a hme ha was vaue a ess

han sein price. Spec buiin as

cnribue his versuppy as cmpee

an unabsrbe new unis accumuae,

peakin in January 2009. Invenry

manaemen has been a key cus

hmebuiers an prices new hmes have

cme wn sinicany in he pas year.

Cmpeins in ae 2009 reec saes mae

in eary 2009. In sme cases, he price an

absrbe uni is reecive spec hmes

ha have been vacan r up six mnhs.

8


9/18


FroM siZZle to FiZZle to siMMer

Calgary Housing deMand reCoversFroM draMatiC pull BaCk oF 2008

By eary 2008 husin eman was areay merain mainy ue ere arabiiy.

Hwever, he seasnaiy MlS saes smewha maske his ren as sprin saes rene

up as usua, abei a a swer pace han 2006 an 2007. Sine amiy sars ha as been

renin wn ue in par iminishe cnsrucin capaciy bu was as a resu a

risin ap in price beween new an exisin hmes. this shie eman he resae marke

in 2007. By he en 2008, amis he ba wie recessin, eman ha a bu zze a

ren ha cninue in he rs w quarers 2009.

Recr w mrae raes, imprve arabiiy an a rwin pen up eman evenuay

ave way a ae bunce back in he as w quarers 2009.

MlS saes are ceary quie seasna s i

is expece ha year-ver-year mnhy

saes in he beinnin 2010 wi be

hiher, mainy as a resu he ramaicay

w eves saes experience in he rs

quarer 2009. Hmes in wer price

caeries wi cninue be in srn

eman in 2010. Hme saes in hiher

price ranes have as perrme we

reecin an asue buyer wh recnize

arabiiy in he marke an was insuae

rm he impacs he recessin.

priCe gap Between resale andnew HoMe priCes iMpaCts resales and starts

New husin sars are as expece be reaivey hih in cmparisn a very weak rs

ha 2009. Prices new hmes are as much mre cmpeiive han in 2007 an 2008 an

have shwn a marke recvery in he secn ha 2009. Sars ypicay a new hme saes

by a eas w mnhs bu sars sme spec unis have been repre.

Whie eman is shwin mes recvery, he impac n prices wi epen n he suppysie he marke. A reurn eman in he as ha 2009 hepe absrb an versuppy

bh resae an new hmes.

Much his versuppy bean buiin in 2007 in he ace rapi price appreciain new

hme buyers eaye he sae heir previus hme he as pssibe minue. these isins

cmbine wih specuars buyin new hmes (wih an inen ip a csin) pruce an

invenry bui-up neary 10 mnhs.

the exen he versuppy is reece in he saes acive isin rais ha rppe

uner 20 per cen in mi 2007 an hen nay bme a 13 per cen in ae 2008.

J F M A M J J A S O N

Source: CR

2500

2000

1500

1000

500

0

YEARLY COMPARISON OF MONTHLY SALES, SINGLE FAMILY, CITY OF CALGA

2004 2005 2006 2007 2008 2009

c a lg a R Y S H o U S I n g M a R K e t

2010in

BrieF

CLEVER CLOSING: Hme saes in hiher

price ranes have as perrmewe reecin an asue buyer wh

recnize arabiiy in he marke

an was insuae rm he impacs he recessin.


10/18

10

a balancing act

supply deMand BalanCe will generate Modest priCe growtH

the rapi equiy appreciain 2006 2007 wi n be seen in 2010. Cnsequeny, new

hme buyers wi be sein earier an rs mve-up aciviy wi be cnsraine by his

swer equiy appreciain. once saes acive isins esabish a ren in he 28 30 per

cen rane, a seay increase in vera prices can be expece. As new isins an new

cnsrucin suppies say w, eman is expece keep price perrmance in he baance

marke rane 2 4 per cen (sihy abve he rae inain).

In 2006 an 2007 ramaic increases in he New Huse Price Inex reece a shrae

suppy as we as risin css cnsrucin incuin an. the lan Price Inex as shwea rapi increase, ahuh sihy ae, inicain he eay evepers experience in

brinin new invenry n ine mee buiers emans. the lan Price Inex has cninue

say eevae a cs buiers have ha absrb we in 2009. Nneheess, css new

cnsrucin an buier marins have nw cme wn. Cnsequeny, new hme prices have

been abe cmpee mre avuraby wih wer resae prices a ren ha wi cninue

in 2010.

the New House Price Index reprs he

price chane new hmes, as ene bya sanar hme he same size, quaiy

an cain, mnh ver mnh. the inex

reecs he acua chane in price n

impace by cnsumer preerences r size

r eaures. the inex is as repre as lan

ony iusrae he cnribuin an

prices he vera price new hmes.

2007 2008 2009

Source: CREB

510,000

490,000

470,000

450,000

430,000

410,000

390,000

370,000

350,000

120

100

80

60

40

20

0

SINGLE FAMILY PRICE COMPARED TO SALES TO ACTIVE LISTINGS RATIO

Median Single Family Price, City of CalgaryAverage Single Family Price, City of CalgarySales to Active Listings, City of Calgary

($) (%)

GETTING EVEN: As new isins an

new cnsrucin suppies say w,eman is expece keep price

perrmance in he baance marke

rane 2 4 per cen (sihy abvehe rae inain).

2010in

BrieF


11/18


conDo conUnDrUM

Condo Market lags in tHe FaCe oF steady inventory

Caarys recen husin bm pushe sine amiy prices up a a rapi rae an eman r

cnminium an mui-amiy hmes quicky we. In respnse buiers enerae an

averae 1200 sars per mnh rm 2004 hruh 2007 resuin in a bui-up invenry

uner cnsrucin ha peake in 2008 a neary 15,500 unis.

A seay suppy new an resae mui-amiy unis has mean ie price rwh r he

cnminium marke, whie a iminishin invenry sines has pu upwar pressure n

he averae price a sine amiy hme.

In 2010 sine amiy resae prices wi aain upace cns as equiy ains rm pre-2006 wi

enabe mve-up buyers ar mre. Cnsequeny, he ap beween sine amiy hmes

an cnminium prices wi cninue wien in he shr erm.

2004 2005 2006 2007 2008 2009

Source: CREB

AVERAGE PRICE COMPARISON, SINGLE FAMILY TO CONDO, CITY OF CALGARY

Single Family Average Price, City of Calgary Condo Average Price, City of Calgary,

0

150, 000

300,000

450,000

600,000

($)

aFFordaBility will BeneFit Condo Market later in 2010

Mui-amiy suppies are ypicay umpy wih buiin cmpeins ain hunres unis

he marke a ne ime. lae 2008 saw many he mui-amiy sars rm 2007 cmpein

a he same ime. lner bui-imes cns as cmpicae marke imin an he rae

suppy. Cmpeins uns unis, especiay in he wnwn aparmen semen,

wi cninue hruh 2010. the versuppy cmpee an unccupie cn aparmens

is expece persis as cmpeins invesr unis are ae he rena sck r are

immeiaey ise r sae.

on a mre psiive ne, nce his excess invenry wrks hruh he markepace, he

exremey w eve new sars wi aain rive prices up, paricuary r he wer price en

he marke ha cann be suppie by he sine amiy marke.

CONDO CONNOISSEUR:In he shr

erm cns wi a in cmparisn

sine amiy hmes bu w eves

new sars wi aain rive prices up,paricuary r he wer price en

he marke ha cann be suppie by

he sine amiy marke.

2010in

BrieF


12/18

12

a silVer lining

aFFordaBility vastly iMproves and

will reMain key to Market growtH

lw mrae raes an earier price reucins have vasy imprve he arabiiy

hme wnership r Caarians an r he ime bein averae hme prices are mre in ine

wih averae incmes. A narrwin ap beween he cs renin versus hme wnership

wi as arac mre rs ime hme buyers in he marke in 2010. Wih a mes rise in

ineres raes n he hrizn penia buyers wi see 2010 as he year ake avanae

wer mrae raes.

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008

Source: StatsCan

145

135

125

115

105

95

58

75

HOUSING COSTS PRICE INDEX CITY OF CALGARY(Index 2002 = 100)

Property Taxes Rent Mortgage InterestWater, and Fuel Electricity

MONTHLY MORTGAGE PAYMENT

BASED ON AVERAGE SINGLE FAMILY AND CONDO PRICE

(1 year and 5 year terms)

($)

2004 2005 2006 2007 2008 2009 2010

$69,750 income

$55,950 income

Source: CREB, Bank of Canada

Assumes mortgage with 10% down payment, 35 year amortization. Monthly mortgage payment based on average single family

and condo prices for the city of Calgary. 2010 uses CREB forecasted average prices and CMHC forecasted mortgage rate.

3,000

2,500

2,000

1,500

1,000

500

0

Month

lyPayment

Single Family 1 yr Single Family 5 yr Condo 1 yr Condo 5 yr

Housing Cost indexreFleCts operating Cost

esCalation

Whie husin prices vera have risen

uiiy css an axes have ae

isprprinaey he arabiiy

chaene. In he shr erm wer

ineres raes wi be a bn r buyers

in 2010 bu ca vernmen eb

an a reurn risin enery css wicninue pu upwar pressure n

axes an uiiy css.

RAISING INTEREST:Wih he chance

risin ineress raes n he hrizn

penia buyers wi see 2010 as

he year ake avanae wermrae raes.

2010in

BrieF


13/18


sMaller CoMMunities outside Calgary provide an aFFordaBle option

the smaer cmmuniies usie he ciy Caary experience much he same price

rens rm 2006 2008. the averae price in hese cmmuniies prvies an aracive

aernaive cn ivin an e he ap beween sine amiy an cn prices in he ciy.

2004 2005 2006 2007 2008 2009

Source: CREB

AVERAGE PRICE TO SALES/NEW LISTIN GS, TOWNS

Average Price Sales to New Listings

450,000

400,000

350,000

300,000

250,000

200,000

150,000

100,000

50,000

0

120

100

80

60

40

20

0

($) (%)

Increasin rafc an cmmue imes wihin he ciy Caary as we as he jb creain

usie he wnwn cre bse he aracin smaer wns in recen years.

Hwever, as he prices in he ciy merae, he appea he smaer cmmuniies has

iminishe a ren ha wi ikey rerea as inner ciy prices bein cimb.

PICK AND CHOOSE: Wih prices wer

an ineres raes he wes inecaes, buyers wi have s

arabe chice in a prucs, sizes

an cmmuniies.

2010in

BrieF


14/18

14

-0.12

-0.10

-0.08

-0.06

-0.04

-0.02

0.00

NENW SW SE Total City Towns

Categorized by square footage


15/18


0

10

20

30

40

50

60

SHARE OF SALES BY HOUSE SIZE

2009 2009, Single Family, City2008, Single Family, City

2008 Towns2009 Towns


16/18

16

F o R e c a S t S U M M a R Y

2009 2010 % CHange trend ForeCaster

eConoMiC indiCators

real gdp -2.5% 2.7% 5.2% scb

Calgary net Migration 12,920 15,000 16% C C

1 yr Mortgage rate 4.05% 3.83% -.22% CMHC

5 yr Mortgage rate 5.5% 5.75% .25% CMHC

oil priCe (usd) $61.78/BBl $90.00/BBl 46% scb

natural gas (usd) $4.15/MMBtu $5.50/MMBtu 33% scb

eMployMent growtH -1.4% 1.3% 2.7% C C

new HoMes

starts singles 4,775 5,300 11% CMHC

starts Multi 1,543 2,300 49% CMHC

Mls resale HoMes

SINGLE FAMILY CIT Y OF CALGARY

sales 14,440 17,000 17.7% CreB

listings 22,459 25,000 11.3% CreB

average priCe 442,327 470,000 6.3% CreB

CONDOS CITY OF CA LGARY

sales 6,328 7,000 10.6% CreB

listings 10,323 10,750 4.1% CreB


TOWNS

sales 3,943 4,500 14% CreB

listings 8,502 8,000 -5.9% CreB



17/18


aboUt tHe c algarY real e state boarD

the Caary Rea Esae Bar (CREB) is a pressina by mre han 5300 icense

brkers an reisere assciaes, represenin 252 member fces. CREB is eicae

enhancin he vaue, ineriy an experise is REAltoR members.

We are cmmie equippin ur members wih he rih s, services an eucain

achieve pressina exceence an in urn enabin REAltoRS er he bes pssibe

service heir ciens.

our REAltoRS are cmmie a hih sanar pressina cnuc, nin eucain,

an a sric Ce Ehics an Sanars Business Pracice. Usin he services apressina REAltoR can hep cnsumers ake u avanae rea esae ppruniies

whie reucin heir risks when buyin r sein rea esae.

CREB peraes an mainains he Muipe lisin Service (MlS) Sysem r Caary an

he surrunin area. thruh he MlS Sysem, members an in urn heir ciens have

immeiae access he aes inrmain n prperies ise r sae. thruh he MlS

Sysem, members can prvie he buyin an sein pubic wih he braes pssibe marke

expsure an he ms cmpee an up--ae marke inrmain.

Fr mre inrmain, visi ur websie a www.creb.cm

Yu can as reach us by phne a 403-263-0530.


18/18

creb com| crebforecast com |2009 Calgar Real Estate Board All rights reser ed

The Calgary Real Estate Board (CREB)

300 Manning Road N.E., Calgary, Alberta T2E 8K4, Canada

Phone: 403-263-0530 | Fax: 403-218-3688 | E-mail: [email protected]

Cpyrih Nice

2009 Calgary Real Estate Board (CREB). All rights reserved. CREB grants reasonable rights of use of this publications content solely for personal, corporate or public policy research, and

educational purposes. This permission consists of the right to use the content for general reference purposes in written analyses and in the reporting of results, conclusions, and forecasts including

the citation of limited amounts of supporting data extracted from this publication. Reasonable and limited rights of use are also permitted in commercial publications subject to the above criteria,

and CREBs right to request that such use be discontinued for any reason. Any use of the publications content must include the source of the information, including statistical data.

REALTOR and MLS trademark owned or controlled by the Canadian Real Estate Association and used under license.

discaimer

The forecasts included in this document are based on information available as of December 31, 2009 and are subject to uncertainty. Although point forecasts are presented in this publication,

CREB includes forecast ranges and risks where appropriate. The information, analyses and opinions contained in this publication are based on various sources believed to be reliable, but their

accuracy cannot be guaranteed. The information, analyses and opinions shall not be taken as representations for which the Calgary Real Estate Board, its board of directors or any of its employees

shall incur responsibility. Where applicable CREB has credited the economic forecast of other third-party organizations including Scotiabank, City of Calgary, Canada Mortgage and Housing

Corporation (CMHC Calgary CMA Housing Market Outlook). The board does not generate statistics or analysis of any individual member or companys market share. All MLS active listings forCalgary and area may be found on the boards website at www.creb.com.

creb 2010 forecast (january 2010)

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