Price gains continue in Calgary's real estate market as inventory remains low

In October, sales activity followed typical seasonal patterns, slowing down compared to the previous month. However, it was noteworthy that there were 2,171 sales, marking a 17 percent increase over the previous year, and one of the highest October sales levels on record. This surge in sales can be attributed to the increased demand for apartment condominiums, as consumers seek more affordable housing options amidst high interest rates.

Additionally, new listings improved this month, reaching 2,684 units, the highest for October since 2015. Despite this increase, the strong sales activity prevented a significant change in inventory levels, which remain more than 40 percent lower than the typical October levels.

Ann-Marie Lurie, the Chief Economist of CREB?, noted, "Despite some recent improvements in new listings, supply levels remain challenging in our market. It will take some time to see a shift towards more balanced conditions and ultimately more price stability."

The tight housing market continues to exert upward pressure on home prices, with the unadjusted benchmark price for October reaching $571,600, a gain from the previous month and nearly 10 percent higher than the previous October.

Detached homes also saw improvements in sales and new listings compared to the previous October. However, with 1,302 new listings and 976 sales, inventory levels decreased over the last month, reaching historically low levels for October. Inventory levels are particularly tight for homes priced below $700,000, while homes above $1,000,000 have seen a slight increase in months of supply.

These persistently tight conditions are driving further price increases in the detached market, with the unadjusted benchmark price for October reaching $697,600, a slight increase from the previous month and a significant 12 percent higher than the previous October. Price increases have been most pronounced in the North East and East districts year-to-date.

Semi-detached homes experienced an increase in new listings compared to the previous year. Still, a high sales-to-new listings ratio of 76 percent prevented a significant change in inventory levels. Inventory levels for semi-detached homes are nearly half of what is typically seen in October, the lowest since 2005. Tight conditions have led to price growth, with the unadjusted benchmark price for October reaching $628,700, reflecting a year-over-year gain of 13 percent.

Row homes saw 420 new listings in October and 375 sales, maintaining a high sales-to-new listings ratio of 89 percent, which kept inventory levels low. These inventory levels are the lowest for October since 2005. October also witnessed a record high in sales for this housing type, leading to a low months-of-supply figure of one month. Price gains persisted in the row home market, with the unadjusted benchmark price for October reaching $425,200, a monthly increase of over one percent and nearly 19 percent higher than the previous October.

In the apartment condominium market, record-high sales were achieved in October due to a significant increase in new listings. However, the high sales-to-new listings ratio of 88 percent and continued demand led to a decline in inventory levels. This decline was primarily driven by condos priced below $300,000, which now represent only 38 percent of all inventory, down from 53 percent the previous year. Seller market conditions have resulted in price gains, with the unadjusted benchmark price for October reaching $316,600, a monthly increase of over one percent and a year-over-year increase of 16 percent.

In the regional markets:

• Airdrie experienced a decline in sales in October, contributing to a year-to-date decline of 29 percent. Limited supply choices in the lower price ranges led to a drop in sales for homes priced below $500,000. Despite some improvement in inventory levels, with less than two months of supply, conditions remain tight, supporting further price gains. The benchmark price in October rose to $521,400, a year-over-year gain of nearly 10 percent.
• Cochrane saw an increase in new listings, likely contributing to the monthly gains in sales. However, year-to-date sales decreased by nearly 22 percent across all property types. Tight market conditions supported further price growth, with the unadjusted benchmark price for October reaching $539,900, a monthly increase of over one percent and a year-over-year increase of seven percent.
• In Okotoks, the high sales-to-new listings ratio of 85 percent and deficient inventory levels prevented any significant adjustments. Despite some price changes over the past few months, the unadjusted benchmark price rose slightly in October and was over nine percent higher than the previous October. Price increases were most pronounced for detached and semi-detached homes.