Homebuyer demand remains strong in Calgary

Homebuyer demand remains strong in Calgary

The RBC report indicates that while home prices in Calgary are among the most expensive in Canada, the on average high household incomes in the area help to ensure that affordability conditions remain relatively favourable, which is constructive for home buying demand. Home resales in Calgary surged to their highest level in six years in the third quarter (32,200 units, seasonally adjusted and annualized).

"Much like the rest of Alberta, Calgary's hot labour market, increasing population and booming economy are the key factors underpinning housing market activity," said Wright. "The flooding that hit the area at the end of June had very little impact on resales, which clearly demonstrates the market's resilience and continued strength."

RBC's measures increased for all housing categories in the area over the latest period; however, levels continue to be below the national and historic averages. The measure rose by 0.7 percentage points to 33.7 per cent points for bungalows, 0.4 percentage points to 34 per cent for two-storey homes, and 0.2 percentage points to 19.6 per cent for condominiums.

RBC's housing affordability measure for the benchmark detached bungalow in Canada's largest cities is as follows:Vancouver 84.2 (up 2.0 percentage points from the previous quarter); Toronto 55.6 (up 1.3 percentage points);Montreal 38.3 (up 0.3 percentage points); Ottawa 37.3 (up 0.4 percentage points); Calgary 33.7 (up 0.7 percentage points); Edmonton 32.9 (up 0.5 percentage points).

The RBC Housing Affordability Measure, which has been compiled since 1985, is based on the costs of owning a detached bungalow (a reasonable property benchmark for the housing market in Canada) at market value. Alternative housing types are also presented, including a standard two-storey home and a standard condominium apartment. The higher the reading, the more difficult it is to afford a home at market values. For example, an affordability reading of 50 per cent means that homeownership costs, including mortgage payments, utilities and property taxes, would take up 50 per cent of a typical household's monthly pre-tax income.