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Calgary eyes home-price bump as inventory thins outTODD KOROL/The Globe and Mail

The inventory of homes for sale in Calgary hit its lowest March level in five years last month, hampering sales growth but setting the stage for a tempered sellers' market this summer, according to the Calgary Real Estate Board.

Resale home-sales growth declined by more than 2 per cent in March this year compared to March, 2012, the board said on Tuesday. If the trend continues, it could give home prices in the city a bump, according to Calgary Real Estate Board chief economist Ann-Marie Lurie.

"It encourages price growth," Ms. Lurie said.

Perhaps more significantly, the board said single-family, year-over-year sales growth declined by 6 per cent. Active inventory totalled 2,713 units, down 22 per cent from levels recorded in 2012, and the lowest March inventory level recorded since 2007. Single-family home prices have seen a year-over-year price increase of almost 9 per cent, hitting $446,500 last month.

The board has long said Calgary prices haven't recovered to the frenzied boom-time levels that were followed by a price drop during the economic downturn in 2008.

"This doesn't encourage a lot of people to list," Ms. Lurie said on Tuesday. "So maybe with some of this price growth, it can actually turn around and we can actually see some of those listings rise."

The lack of affordable options in the single-family homes market is driving some buyers to look in surrounding municipalities, or at condos or the new-home market. With those options available, Ms. Lurie emphasized it's unlikely any run-up in prices will be dramatic. Buyers are also still worried about the health of the economy, she said.

The question is now whether the trend of lower inventory numbers continues into the rest of the year. Ms. Lurie acknowledged April is usually more of a telling month than March.

"That is what I'm watching right now."

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