Earlier this year Calgary Real Estate Board (CREB) released its mid-year forecast update that indicated the Calgary regional resale housing market is in for a turbulent ride over second half of the year. Here are five points from the Mid-Year Real Estate Forecast:

1- Not just a drop in the bucket:

CREB, citing a number of economists, warns that the broader effects of oil price shocks have yet to be fully realized in both the energy and non-energy sectors. Oil prices are expected to average $55 US per barrel, which is nearly 13% lower than expectations from the end of 2014. What that means is all sectors, including housing, will likely face more downward pressure heading into 2016.

2- Weaker resale demand:

Despite the decreasing interest rates, the demand for housing will be weaker than expected. CREB attributes that further job losses are expected this fall, rising unemployment levels and weaker migration numbers to the city. Overall, real estate sales activity in Calgary is expected to decline by 22% to 19798 units in 2015 and home prices will contract by 0.2%.

3- New home construction slows down:

A pullback in new residential construction will prevent further further build up in product under construction, and thus lessen the risk of oversupply and large price corrections. The caveat is if  the economic downturn extends beyond this year, it could start to impact household formation numbers in the city and cause some inventory buildup.

4- Vacancy rates rise:

Vacancy rates gone up from 1.5% last year to 3.6% this year.

5- Regional differences:

Outside of Calgary, the story varies. In Airdrie, the rate of decline in sales activity was less than that seen in Calgary. Home prices, as a result, have remained 4% above last year. In Rocky View County, the decline in sales activity has been exasperated due to record levels in 2014, yet home prices have remained about the 10 year average. In Foothills, more selection, combines with a decline in sales activity, has places some downward pressure of price growth., but overall benchmark prices prices are higher than last year. Moving forward, all three areas will continue to benefit from their relative affordability as well as buyers lifestyle preferences.