Condo Rising To New Highs

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Unit sales up 40% in last year

By IAN WILSON, BUSINESS EDITOR
May 12, 2006

Condominium sales in Calgary have jumped an eye-popping 40% over last year, according to ReMax.

The real estate company's 2006 condo report, released today, said more than 2,500 units were sold during the first quarter, up from 1,799 sales in the same period of last year.

Condo prices in the city, meanwhile, have leapt 23% year-over-year.

That represents a more than $40,000 increase, bringing the average to $220,437.

"None of us have ever seen a market like this," said Rick Bumphrey, a ReMax broker who's worked in Calgary for 27 years. "It's so hard to predict what's going to happen in this kind of market."

Young professionals and first-time buyers are driving the condo market and despite the rapid price hikes, the report calls residential properties in Calgary "a bargain" compared to Toronto and B.C. markets.

"Affordability has become a serious issue across the country," said Elton Ash, ReMax's regional executive vice-president for Western Canada.

"Despite relatively low interest rates and the availability of longer amortization periods, many first-time buyers are finding they have to stretch their budgets to realize the dream of home ownership."

Ash said condos offer the best option in terms of both affordability and location.

The popularity of condos is made evident by the fact they now make up 28% of total residential sales in the city, with half of those purchases occurring between the $150,000 to $250,000 price point.

"To date, there appears to be little resistance to rising prices," said the report.

The greatest upswings in de-mand have happened in Mission, Connaught, Bankview, Eau Claire, Altadore/Garrison Woods and south Calgary.

Sales of luxury condominiums have also been hot, with 49 units over $500,000 being snapped up so far this year.

That compares to 20 luxury condo sales during the first quarter of 2005.