After a small slowdown in the market in the second half of 2022, Calgary roared right back to life in 2023… well, in some ways.
The market is extremely tight with the lowest inventory we have ever seen. This means properties selling quickly, often in competing offers and often above asking price.
But because inventory is SO lacking, it has brought the number of sales down significantly. There is simply nothing to buy.
For example, March 2022 had 4,041 sales in all categories (detached, attached, townhome and apartment). This March, the number was 2,429, a drop of 40%!
Normally in Calgary when we see a drop in the number of sales, it’s because there is TOO MUCH inventory and buyers are sitting on the sidelines, waiting for prices to drop. This time around, the demand is there. Buyers want to buy. But they are struggling with higher interest rates, higher prices, competing offers, low inventory and a very challenging buying environment.
The detached market continues to show strength across many price ranges. I’ve been in competing offers for $500,000 homes and for $1,000,000 homes. Buyers in this market have adjusted to higher interest rates and are willing to do what it takes to get a home. The most desirable homes are selling with no conditions – no financing, inspection, etc. Some homes are selling more than 10% above their asking price.
This certainly leads to more risk for buyers and I hope that Calgary will move back toward balanced market conditions to allow consumers the proper time to do due diligence and make good decisions. However, there are no signs of that happening in the short term.
A balanced market is 3-4 months worth of inventory. All categories are seeing inventory levels below 1.5 months with row homes being the tightest market currently at 0.95 months!
Even apartment condos are in a strong seller’s market and prices have risen in this category nearly 8% this year alone, from January to April.
This all makes it sound like a great time to sell. And it is. Sellers often have a lot of leverage in negotiations and can dictate their possession date and terms. However, sellers that are shooting too high are still sitting on the market for a few weeks and sometimes reducing price.
The biggest challenge for sellers right now is where to go! If you are moving within Calgary & area, you will be experiencing those same tight market conditions on the buying side. And from what I hear, many real estate markets across Canada are in about the same boat. Or, if you want to sell and rent for a while instead, the rental market is extremely tight with many properties having dozens of interested renters. This makes it very tough to be chosen, especially for pet owners.
Best bet? Sell here and try and find another country to move to with cheaper houses 🙂
With all of this said, it is possible to buy in this market. Doing your homework, being prepared and being aggressive are key components of successfully buying right now. Plus, having a great realtor on your side helping you navigate this crazy market!