Market continues shift toward more balanced conditions after torrid start to the year
Citywide sales in August reached 2,151 units, 37 per cent higher than last year and 25 per cent higher than long-term trends. Sales have slowed from the record-setting pace seen earlier this year, but on a year-to-date basis, the eight-month total of 19,516 sales is higher than annual sales figures recorded over the past six years.
“Sales have far exceeded expectations throughout most of the pandemic, driven mostly by demand for detached homes. At the same time, supply could not keep pace and conditions shifted to favour the seller, something that has not happened in over six years,” said CREB® Chief Economist Ann-Marie Lurie.
“With more buyers than sellers, prices rose, providing opportunity for many of the move-up buyers in the market. Over the past several months we have seen some adjustments in supply relative to sales, helping move us toward more balanced conditions.”
The months of supply in August was nearly three months. This is an improvement relative to earlier in the year, but conditions generally remain far tighter than typical August levels. However, some improvements in supply compared to sales have been slowing price growth.
As of August, the total residential benchmark price was $459,600, slightly lower than last month, but over nine per cent higher than levels recorded last year. The price gains have ranged by product type, with the highest gains occurring in the detached sector of the market.
HOUSING MARKET FACTS
Supported by gains in every district, August sales totalled 1,300 units, which is 31 per cent higher than levels recorded last year and well above long-term averages. New listings have also improved relative to last year, but it has not been enough to cause any substantial change in inventory levels, which fell to 2,770 units this month. The months of supply remained just above two months in August. This is well below traditional levels for this time of year, but not as tight as levels recorded earlier in the year.
Following several months of strong price gains, August prices remained relatively stable compared with July figures, but were more than 10 per cent higher than levels recorded last year. Price gains continue to vary significantly based on location. Prices have risen across all districts relative to last year, but prices trended down In the City Centre, North West, West and South districts compared to last month.
Further year-over-year sales gains in August contributed to a record-high year-to-date sales total of 1,797 units, more than 70 per cent higher than last year. Sales have improved across all districts in the city, but the largest gains occurred in the West, North West and City Centre.
While inventory levels have trended down over the past few months, so too has sales activity. The months of supply rose above three months in August for the first time since October of last year. Any shift toward more balanced conditions will help ease some of the upward pressure on prices.
As of August, the semi-detached benchmark price was $430,000, nearly 10 per cent higher than last year, but only slightly higher than last month. Despite strong price gains across all districts, prices still have not recovered from previous highs in the South, North East and City Centre districts.
The pace of growth in the sector has slowed, but row sales maintained their momentum in August, which was enough to push year-to-date sales to a new record high. New listings have also risen, preventing a more significant drop in inventory levels, but the months of supply fell just below three months in August.
The tighter conditions have been supporting price gains throughout most of the year, but the pace of growth is starting to slow. The row benchmark price in August pushed above $300,000, eight per cent higher than last year. Row prices have improved, but they remain lower than previous highs across every district in the city.
Sales activity in August was higher than anything recorded over the past six years, but thanks to continued gains in new listings, inventory levels remain elevated compared to last year and longer-term trends. With 332 sales and 1,786 units in inventory, the months of supply remained above five months in August.
While conditions are far better than last year, the apartment condominium sector has not seen the same type of sellers’ market conditions present in other property types, limiting price growth. As of August, the benchmark price was just over two per cent higher than last year, but it remains nearly 16 per cent lower than previous highs.
REGIONAL MARKET FACTS
Activity in the city showed few signs of slowing down as new listings were nearly matched by sales, keeping the sales-to-new-listings ratio at 88 per cent and the months of supply at just over one month.
The persistently tight conditions have contributed to further gains in prices this month. As of August, the benchmark price reached $389,500, which is nearly one per cent higher than last month and nearly 14 per cent higher than prices recorded last year. Most of the gains have been driven by the detached segment of the market.
Limited supply continues to weigh on the Cochrane market. In August, there were 88 new listings added to the resale market, but they were matched by 90 sales, keeping inventories exceptionally low at 154 units.
The market continues to favour the seller. With fewer than two months of supply, tight conditions have been impacting prices. As of August, the benchmark price totalled $452,400, 12 per cent higher than levels recorded last year.
A reduction in new listings likely prevented stronger sales this month. In August, there were only 56 new listings compared with 65 sales, causing inventories to drop to 85 units and the months of supply to fall to the lowest level ever recorded in August at 1.3 months.
The persistent sellers’ market conditions supported further price gains this month. The benchmark price in August reached $490,500, nearly one per cent higher than last month and over 11 per cent higher than prices recorded last year. Price gains continue to be driven by detached homes, which have recorded year-over-year gains of nearly 13 per cent.
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