Calgary had mixed fortunes in August. Record high sales for the month were counterbalanced by the record low inventory numbers in the city, keeping supply historically low, according to the Calgary Real Estate Board.
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Buyers Turn to Affordable Housing Options Amid Inventory Constraints
There were 3,254 units available, the lowest it’s ever been in the city for the month of August. Those record lows have been driven by a pullback in new listings under $700,000, particularly in the detached sector. This lack of detached supply, along with a shortage of semi-detached and row listings, boosted condo apartment popularity. Deemed more affordable than renting or forking out for a more expensive detached home, apartment sales have shot up by a massive 67% year-over-year, with 867 apartments trading hands.
This isn’t to say that availability is much better in the apartment sector. While new listings have increased by 37% on a yearly basis, they are struggling to keep up with the pace of sales. Rising demand has led to dwindling inventory of condo apartments with just 1.1 months of inventory available – down 59% year-over-year. Prices are also steadily climbing in response to tight market conditions, as the benchmark price for an apartment hit $309,100 – 1% higher than in July, and up 13% on a yearly basis.
The Ongoing Real Estate Price Surge in Calgary
One thing has remained constant throughout the year in Calgary – the price of a home continues to climb. While other markets across the country have seen the odd decline in response to higher mortgage rates, Calgary prices have held strong for eight consecutive months. The benchmark price of a home is now $570,700, up 8% year-over-year. It stands to reason that this is the highest it has ever been, and as inventory dwindles and demand remains as high as it is, it’s entirely possible this price will continue to climb for the rest of the year and potentially beyond.
Each property type has trended upwards, with row properties experiencing the greatest growth. The benchmark price for a row home is now $413,200, an increase of 16% on a yearly basis, and up 1.4% from July.
Regional Markets Are Feeling the Squeeze
The surrounding markets are feeling the pressure of the tighter conditions. In Airdrie, there is just 0.86 months of available inventory, with only 176 homes on the market. Inventory in Cochrane also fell after some gains in the last few months.
Cochrane and Airdrie also experienced mild price gains in August. Airdrie’s benchmark price reached $515,600, up 0.3% while Cochrane’s home price hit $534,700, up 1% from July. Interestingly, despite the tight market in Okotoks, the price actually fell on a monthly basis by 0.8%. It’s important to note however that the current benchmark price of $582,000 is still up 7% on a yearly basis.
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