September proved to be a strong month for real estate in Calgary according to the Calgary Real Estate Board’s (CREB) most recent market update. With 1,901 sales, the city saw more properties trade hands than in September of 2019, and it exceeded the long-term trends for the city. After months of demand for larger properties during the pandemic, buyers in the city are now gravitating towards more affordable segments of the market including condos and row houses.
Sellers: Competition is High for Condos and Row Houses
Apartment condo sales experienced a 60% gain over last year, setting a new September record and being a large contributor to the 5,026 year-to-date sales. While in many other cities in Canada buyers have paused their home search and are waiting out the interest rate hikes, in Calgary, buyers are rethinking their strategy and pivoting to more affordable properties.
- Read: Alberta is One of Canada’s Strongest Real Estate Markets Right Now, Here’s What is Setting it Apart
September saw an overall decline in new listings by 10%, and with lower inventory levels and higher demand, prospective sellers sitting on condos or row properties should consider listing their homes now. “While demand is easing, especially for higher priced detached and semi-detached products, purchasers are still active in the affordable segments of the market, cushioning much of the impact on sales,” said CREB® Chief Economist Ann-Marie Lurie.
Sales Activity Eases for Detached and Semi-Detached Markets
The detached market has experienced six consecutive months of slowing sales activity in the Calgary area. Since benchmark prices are 11% higher than last year and still 6% higher than the beginning of the year, detached properties under the $500,000 mark are few and far between, causing competition and conditions to remain tight. Many detached properties are now being priced between $600,000 – $999,999, in fact, the largest growth in September in new listings was seen in this price range for detached properties. Comparatively, this is still significantly less than the Toronto and Vancouver averages for detached homes, which sit at $1,648,298 and $1,906,400 respectively.
After high price gains earlier this year, the semi-detached market has reached its peak and prices are trending downwards. However, at the moment prices are still 10% higher than last year when buyers were seeking more space to support a shift in lifestyle during the pandemic. “Price reductions are common in Calgary and Edmonton right now,” explains Drew Carlson, Real Estate Agent with eXp Realty. “Sellers are realizing that they have to be realistic and price their home properly.” Now, it seems prospective sellers don’t want to deal with the changing market or let go of their larger properties. This lack of supply is causing tight market conditions and inventories are now below long-term trends.
Regional Cities are Experiencing a Slowdown
Sales eased in both Airdrie and Cochrane in September. In Airdrie, there has been a dip in inventory causing tight market conditions to continue into the fall and the residential benchmark price for the area is currently sitting at $502,300, a year-over-year increase of 15.9%. While in Cochrane, the total residential benchmark price is $641,000 and it saw a slight uptick in new listings compared to last year, with a total of 165 units available. Although this is 30% lower than the September average, it is an improvement.
In Okotoks, the number of new listings has grown compared to last year, but not enough to ease the tight market conditions. Inventory remains around 50% lower than the September average, with less than two months of supply. Home buyers in Calgary’s surrounding cities are being cautious which is putting downward pressure on home prices; in Okotoks alone, prices have eased almost 2% month-over-month.
If you’re considering buying or selling in Calgary or surrounding areas, download our free Buyer’s or Seller’s Guides and contact us today to connect with a local real estate agent.
