There have been some assertions recently that Calgary is in a "balanced" market from Bob Truman's What's New page.
Jan 25What does balance market mean? Here is the definition of "balance"
It's a nice change from the past two years for everyone. It's taking an average of 52 days to sell a house, and going down. Traditionally, it would take a house 45 - 50 days to sell. Prices should fluctuate slightly from month-to month, but I don't expect any dramatic rise or fall. March, April and May will return as the usual big months for sales. The balanced market, as predicted, is here.
Sales of single family homes are about equal with historical averages for the first 20 days of January. With 628 sales so far this year, we're one ahead of the 7-year average of 627. The last time we had anything close to a normal balanced market was in 2005, and that year there were 560 sales. The average price in 2005 was $268,306. That's a 69% gain in three years.
The average price of single family homes in Calgary has risen $10,000 in the first 11 days of 2008. The median price has dropped $4,000. Condo avg price is down $4,000, median is up $3,000. So far in 2008, it looks like the balanced market is here and functioning well.
A state of equilibrium or parity characterized by cancellation of all forces by equal opposing forces.
Looking at the stats this January has not seen a balance between buyers and sellers. Between Jan 1-21 the sales/new listing ratio is around 30%*. This is low even when going back to "balanced" years before the boom.
The CREB used to define balanced market as between 2-3.5 months inventory before starting to play games with charts. Andrew Kyle, determined that on Jan 2 Calgary was in a buyer's market by the month's inventory of around 4.5. How many months inventory are we at considering the sales between Jan 1-24 (Mike's site)?
Months inventory= (Inventory / Sales ) x (24/30)
SFH = (3992/798)*(24/30) = 4 months
Condo = (1926/327)*(24/30) = 4.71 months
Buyers market according to Months inventory.
Buyers market according to Sales to Listing ratio.
Also looking at Andrew's site shows that Days on Market has decreased fairly quickly starting in January in past years. We may be following that pattern again as spring market heats up but higher in absolute terms.
*Sales/New Listings ratio may be in fact higher due to relistings
The (24/30) part of the equation is to adjust for only 24 days of sales.