CALGARY — Prices for repeat home sales in Calgary rose from a year ago, according to the Teranet-National Bank House Price Index released on Wednesday.

In October, Calgary prices were up 3.5 per cent compared with October 2011 while prices at the national level rose by 3.4 per cent in the 11 markets surveyed.

The index is estimated by tracking observed or registered home prices over time using data collected from public land registries. All dwellings that have been sold at least twice are considered in the calculation of the index.

On a monthly basis, however, prices were down by 0.2 per cent in both Calgary and across the country.

In Canada, it was the 11th consecutive month of deceleration in 12-month inflation.

The index was also the third October monthly decline in 13 years of data, including 2008 when the country was on the verge of recession.

David Madani, Canada economist for Capital Economics, said the recent decline in the sales-to-listings ratio points to home price stagnation ahead in Canada.

“Overall, we still standby our view that Canada housing market is due for a 25 per cent price correction,” he said in a research note. “Home prices have held up so far, prompting economists to declare a soft landing. But we think this is premature.

“We think the pace of home price appreciation generally speaking will stagnate early next year.”

mtoneguzzi@calgaryherald.com

Twitter:@MTone123

CALGARY — Strong employment growth in the Calgary region has sparked more people from other parts of the country to move here, buoying the local housing market for the next two years.

According to Canada Mortgage and Housing Corp., net migration to the Calgary census metropolitan area will balloon to 20,000 people this year after numbers dropped to 9,209 in 2010 and 11,220 in 2011. And the CMHC is forecasting net migration to the region to be 18,000 in 2013.

“With the relative strength of our labour market, the growth of employment and a low unemployment rate will help attract people to Calgary,” said Richard Cho, senior market analyst in Calgary for the CMHC on Tuesday as the agency held its 19th Annual Alberta Housing Outlook Conference in Calgary.

“Net migration is a key component to housing demand . . . Whenever you have an influx of people come to a region you’re going to see some strong demand for housing in the rental market as well as in the homeownership market.”

Net migration to the Calgary region peaked in 2006 as it approached 25,000 people.

Those net migration numbers will help boost MLS® sales by 15.7 per cent this year in the Calgary CMA to 26,000 transactions and by another 1.9 per cent in 2013 to 26,500 sales.

The CMHC is forecasting average MLS® sale prices in the Calgary region to rise by 2.0 per cent this year to $411,000 and by another 2.7 per cent next year to $422,000.

Total housing starts are estimated to rise by 33.4 per cent this year to 12,400 units but dip by 4.0 per cent in 2013 to 11,900.

mtoneguzzi@calgaryherald.com

Twitter:@MTone123

CALGARY — Total housing starts in the Calgary region are forecast to finish this year up more than 33 per cent from the previous year, according to Canada Mortgage and Housing Corp.

In its latest Fall 2012 Calgary Housing Market Outlook, released Monday, the agency said total housing starts in the Calgary census metropolitan area will increase to 12,400 units this year before moderating slightly to 11,900 units in 2013.

This year’s level is the highest since 2007.

“Supported by low mortgage rates, strong job growth, and a sharp increase in net migration, demand for new homes in Calgary will remain elevated over the next two years,” said Richard Cho, senior market analyst in Calgary for the CMHC. “Supply in the competing resale market and inventories of new multi-family units have also declined from their previously elevated levels, further contributing to the pace of construction.”

Single-detached starts are forecast to finish 2012 with 5,700 units, up 12 per cent from 2011 levels.

“Demand for new homes will continue to improve in 2013 as prospective buyers and migrants take advantage of Calgary’s labour market, and some existing homeowners capitalize on their equity gains and move-up,” said Cho.

He said a large proportion of the new construction is taking place in the north and south ends of the city where there are a higher number of newer communities.

“With the increase in new construction activity and the decline in the unemployment rate, it is taking more time for some home builders to fill their vacancy positions compared to a year earlier,” added Cho. “The higher demand for labour is also putting some upward pressure on earnings.”

Tim Logel, president and partner of Cardel Lifestyles, said the number of people moving to the Calgary region is a good indication of future housing demand.

“What we’ve seen the number of homes in Calgary new and used . . . the number of listings year-over-year is down and because of that you’re seeing shorter times for a home to sell,” said Logel. “You could see more demand next year with maybe the same amount of supply because of in-migration.

“Overall, there’s a level cautiousness with homebuyers . . . The customers are noticing there’s not as much to choose from as they would have had a year ago.”

Logel said the homebuilder is challenged by labour these days as there’s not enough skilled people to build the homes today.

“And we ask ourselves what would happen if the demand did pick up. What would happen if the supply would drop further? Then there would be increased pressure on new housing,” said Logel, adding the availability of good land is also a challenge.

In 2013, CMHC forecasts single-detached starts to increase four per cent to 5,900 units.

Multi-family starts in 2012 are on pace to reach 6,700 units. With the start of many new multi-family projects this year, the number of units under construction has also increased. Some of these units will represent additions to inventory when completed and will inhibit construction in 2013. CMHC is forecasting multi-family starts to remain above historical averages in 2013, but to moderate 10 per cent to 6,000 units.

Labour market conditions in Calgary have been favourable, attracting migrants from other regions and increasing housing demand, added the agency.

Existing home sales in Calgary are on pace to increase 16 per cent in 2012 to 26,000 units, the highest level since 2007. In 2013, modestly higher mortgage rates, combined with a slower pace of job creation and net migration, will moderate sales growth. MLS® residential sales are anticipated to rise two per cent to 26,500 units.

The average price for the Calgary region is forecast to increase two per cent from $402,851 in 2011 to $411,000 in 2012. Balanced market conditions are expected to persist for the remainder of this year and into 2013. The average price in 2013 is expected to reach $422,000, up almost three per cent from a year earlier.

mtoneguzzi@calgaryherald.com

Twitter:@MTone123

CALGARY - Record-breaking luxury home sales and a flood of high-end retailers into the city are just two indicators of Calgary’s growing wealthy population.

Recent statistics from Investor Economics Strategy Consulting show Calgary not only has more high net worth households than any other city in the Prairie provinces, but Calgary’s wealthy are actually richer, on average, than the wealthy in any other Canadian city. Looking only at households with a net worth of $500,000 or more, these wealthy Calgarians average out at a net worth of $3.3 million each. Toronto’s high net worth households average $2.2 million, while in metro Vancouver, the households that fall into that category have an average worth of $2.1 million.

Recently, the national head of a new BMO Private Banking Division — aimed exclusively at meeting the investment and estate planning needs of the ultra-rich — made a visit to Calgary to host information sessions for some of Calgary’s wealthiest.

“Clearly, there is an opportunity given the size of the market,” said Diana Reid.

Meghan Meger, Alberta Regional Director for the BMO’s Private Wealth Group division, said Calgarians in a high net worth position run the full spectrum, from professionals with young families to longtime, more senior Albertans.

“We are seeing second and third generations with even emerging fourth generation business families, from both the oilpatch and the cattle industry,” Meger said.

BMO is not the only organization taking notice of Calgary’s wealth. In the last couple of years, Chinook Centre shopping mall has welcomed a host of luxury retailers, from Louis Vuitton and Gucci to Tiffany’s, Michael Kors, and Burberry. In September, the mall announced that high-end American department store Nordstrom will be moving into space recently vacated by Sears.

Terry Napper, general manager of Chinook Centre, said there was a time when luxury retailers were only interested in the Toronto and Vancouver markets. One of the first high-end retailers to land at Chinook Centre was kitchen store Williams-Sonoma in 2007.

“It was very difficult for us to convince them that they should have a store in Calgary,” Napper said. “But we did that deal, we opened them, and they were amazed at the results. And of course, that word started to spread and our leasing team started to get inquiries from other similar retailers ... Since we’ve announced the Nordstrom deal, we’re getting inundated with these high-end luxury retailers that want to come to Calgary.”

Napper said Chinook Centre is on track to reach $700 million in annual sales by the end of 2012.

On the real estate scene, sales of luxury homes in Calgary’s resale housing market have already set a record this year. In October, Calgary hit 459 year-to-date MLS® sales of properties over $1 million, one more than the previous record set in 2007 for the entire year.

Last year, there were 446 luxury home sales in Calgary and in 2010, there were 365.

Corinne Poffenroth, a Realtor® with Sotheby’s International Realty Canada, told the Herald last week that her high-end inventory has had a record number of inquiries and interests in the last quarter.

astephenson@calgaryherald.com

CALGARY — Calgary and Edmonton have displaced Toronto and Vancouver as the top-ranked cities for overall real estate prospects, according to the Emerging Trends in Real Estate 2013 report released Tuesday.

The report, by PwC and the Urban Land Institute, said the Canadian real estate market is expected to remain steady with “modestly good” investment and development prospects across most property sectors for 2013, reflecting expectations of solid supply and demand.

Calgary was the top-ranked city in the country followed by Edmonton, Toronto, Vancouver and Ottawa.

In this year’s survey, Calgary ranked first in both investment and development prospects and second in homebuilding prospects.

“Growth characterizes Calgary’s future; it displaces Toronto as the top ranked city for 2013,” said the report. “This has made it challenging to acquire high quality real estate in Calgary, absorption of prime properties has reached record levels, and rents are being pushed due to limited supply.

“This trend will continue in 2013, especially in office and industrial employment space. Construction will increase in the housing and non-residential arenas, but nowhere near pre-crisis levels.”

According to survey participants, Canada’s real estate market will follow along in a seeming state of near-perpetual equilibrium compared with other more volatile regions studied in the report, including most obviously the United States.

“The results of this year’s Emerging Trends report reflects the fact that the Canadian real estate community understands real estate fundamentals and knows how to react to fluctuations in monetary policy and capital markets. Canada’s real estate industry continues to operate well despite uncertainties in domestic and global economies,” said Lori-Ann Beausoleil, PwC Canada’s Real Estate Leader.

The report said Calgary’s expanding economy is requiring a larger and more highly-skilled workforce. Employment forecasts indicate growth of 2.8 per cent next year and 2.9 per cent in 2014.

“This growth, driven mostly by the oil and gas industry, has made it challenging to acquire high-quality real estate in this market,” said the report.

“Absorption of prime properties has reached record levels and rents are continuing to be pushed due to limited supply.”

The report said potential approvals of controversial pipeline projects to the United States and into British Columbia would boost real estate construction projects further in Calgary.

The strength of Calgary’s real estate market is evident in both the residential and non-residential sectors.

According to the Calgary Real Estate Board, year-to-date as of Monday, total MLS® sales in the city of 18,905 are up 15.56 per cent from the same period last year.

Canada Mortgage and Housing Corp. is forecasting total housing starts in the Calgary census metropolitan area to finish at 12,400 units this year, an increase of more than 33 per cent from 2011 and the highest level since 2007.

RealNet Canada recently said Calgary has experienced the second best ever year for commercial real estate transactions for the first nine months of the year with $3.394 billion in sales so far this year.

And a recent report by Jones Lang LaSalle suggested a downtown office development boom in Calgary could be on the horizon.

mtoneguzzi@calgaryherald.com

Twitter:@MTone123