Apartments offer optimism

Calgarians drawn to more affordable alternative

After living in southwest communities of Midnapore and Evergreen for 27 years, transitioning to an apartment in Mission was an easy decision for Michelle Norman.

"Condo living was a very easy adjustment," she said. "I like the idea of being surrounded by a good mix of young and older residents as well as not having to worry about such things as yard work and snow removal." While saving her back from shovelling, Norman's apartment also met her requirement for a two-bedroom unit that was pet-friendly and offered easy access to amenities.

"It's a great location – easy to get to shops, transit, parks and work – so that made the transition even better," she said.

In its 2015 Economic Outlook, RE/MAX Canada noted Calgary's multi-family segments are prompting optimism in the local housing market – particularly as an affordable solution to rising housing prices.

"Condominiums and townhouses are expected to represent a growing share of the active marketplace, as long as they are priced competitively," said the report.

In May, year-to-date apartment sales in Calgary totaled 1,383 units, a 32 per cent decrease compared to the same period last year, according to CREB®'s monthly resale housing report. Over the same period, listing declines have been a more moderate 0.7 per cent to 3,229 units.

Despite the sales-to-listings gap, prices have remained fairly steady so far in 2015. CREB® reported the benchmark price for apartments in May was $294,800, a 1.2 per cent increase compared to April and 0.2 per cent increase year-over-year.

On the new home side, industry watchdog Altus Group reported new condo sales (apartment and townhomes) were down 61 per cent over the first three months of the year compared to 2014.

Yet a dramatic rise in apartment-style condo starts in May has provided renewed optimism, contributing to a 79 per cent year-over-year jump in multi-family development in the city last month, according to Canada Mortgage and Housing Corp. (CMHC).
The national housing agency reported construction began on 759 multi-family units in the Calgary census metropolitan area in May, compared with 424 during the same period last year.

Apartment starts in May totalled 457, a whopping 614 per cent increase from 64 starts last year. Most of the activity was centred in the northeast (176 starts), southeast (158) and Airdrie (83).

East Village continues to represent a hot bed of local apartment activity. The area to the east of downtown began welcoming its first residents began last month, and has been in the news following council's approval of the city's first car-less apartment development, dubbed N3 by Knightsbridge, in the area.

Developer Cidex has also announced it will be constructing a 221-unit rental building in the community that will include one-, two- and three-bedroom suites. The tower represents the first purpose-built rental development in East Village.

To the south in Mission, Calgary's luxury apartment market was sparked in early June by the sale of three units at The River priced at $3.59 million each. The 15-storey, 38-unit luxury development along the Elbow River on 26th Avenue S.W.'s remaining suites are $7.99 million. The River has an estimated completion date of later this fall.

"Calgary is on a tipping point right now, with condo living becoming a more sought after alternative to suburban life," said Embassy Bosa president Ryan Bosa. "The future of Calgary is up not out, and developments like the East Village showcase how Calgary is creating vibrant, sustainable communities."