Calgary’s real estate market hottest in years

Calgary’s real estate market for detached homes is on a tear, with the benchmark price up $12,000 in the last month alone.

That benchmark home now sits at $472,300, an increase of 12 per cent over this time last year and still well below Toronto and Vancouver which sit around $1.26 million.

The surge in sales is being attributed to a rebounding economy, the city's affordability and lifestyle, and buyers trying to get in before expected interest rates hikes later this year.

"The detached market is really the one that has been driving so much of the activity, there have been exceptionally strong sales continuing and the supply hasn't been there,” said Ann-Marie Laurie,the  chief economist at the Calgary Real Estate Board (CREB).

Calgary’s relative affordability is also attracting out of town buyers, who in some cases are sending gushing letters to homeowners hoping to beat the rising market by demonstrating their passion for a particular property.

“We are seeing a lot of out of town people coming in to buy in the Calgary market,” said Bev Clark, owner and broker at Knag Real Estate.

A rebounding economy and rock-bottom borrowing costs are helping fuel the rush, but exciting times require some caution.

"I heard one realtor compare this to the 2006 market. But we all know what happened in the 2008 market,” said Clark.

With inflation surging interest rates will eventually rise, driving up monthly mortgage payments - and some questions are being asked about the strength of the world economy.

Clark cautions buyers to not lose their head and to live within your means, but even that carries some risk.

"Maybe if you have to wait a little while for the market to correct you should maybe wait, but there's always the risk our market will re-adjust to a higher number," Clark said, even though it’s not what people want to hear.

There's also some decent news for people looking for condos and townhouses: while the market is picking up, they still haven't returned to previous highs.

“It's just not as competitive right now so again it's another positive for our city, we have home ownership options in many different price ranges," Lurie said.