Long and short of June is that, some of the lagging effects on price from the decline in sales activity as a result of Covid 19 started to take effect, but at the same time we saw a big rebound in market sales activity as the month progressed. In fact, after 3 long months of the heavy effects on our local real estate market as a result of the pandemic, our sales activity trended up to just 2% lower than June of last year. Now this in comparison to 40+% year over year declines in activity over the previous 3 months.
“Recent price declines, easing mortgage rates and early easing of social restrictions are likely contributing to the better-than-expected sales this month,” said CREB® chief economist Ann-Marie Lurie. "However, the market remains far from normal. Challenges such as double-digit unemployment rates will continue to weigh on the market for months to come.”
New listings for June were up over last year which makes sense as there was a pent-up demand from those holding their listings until the restrictions had eased. With sales activity up and listings still just steadily coming on, it did allow for our months of supply to dip just below 4 months for the Calgary market area. Should we see more of the same along with continued low interest rates as the summer continues, it should ease the downward pressure on price and allow us to stabilize prices sooner than expected.
Buyers are starting to jump into the market for many reasons, some to do with being locked down and assessing change, others to take advantage of low interest rates and great prices in specific market segments. One of those segments would be the very hot 300-600K detached market. Things are really picking up in that price range and listings are moving which is also fantastic for sellers and those wishing to make a move up.
We are starting to experience pressure from the bottom up in the market. Renters that are looking to be first-time home buyers and sellers in the 300-600K range are using this opportune time to also make a move up in the market. Remember too that Calgary has had positive numbers in net migration to Calgary, and as a city of over 1.1M people it also starts to benefit from a self-propelling economy.
Please reach out to chat with me about any and all questions you may have. We can talk about real estate investment opportunities, if now might be the right time to make a move, how to prepare financially for a purchase or simply to just chat about the many moving parts going on out there in our local market. I would like to end this market update with a gratitude for the fact that with everything going on out there, most of the people I talk to are staying positive and that includes consumer confidence!