The third quarter saw a shift in market conditions in the Calgary real estate market. After an extremely red-hot first two quarters with consistently less than 1.4 months of inventory, it seems as though buyers are taking a small breather.
We have now risen to 2.5 months of inventory, which is still a seller’s market but is very closely approaching a balanced market (three to four months of inventory). We are a long way from a buyer’s market, however.
July and August often see slower sales due to many people travelling and focusing on their fun summer activities, rather than the real estate market. There was likely also some buyer fatigue this year – it was an admittedly very tough to time to be a home buyer this spring and some buyers made choices to wait it out for cooler conditions.
Our net migration numbers continue to be strong, though those statistics lag and we won’t know the Q3 numbers for some time. It may be that the draw of affordable housing here in Alberta has lost some of its charm as our prices have risen over the last four years and some markets where people are moving from have dropped.
Let’s dive into the numbers:
Detached Homes
- Normally makes up 60% or more of the sales in Calgary but due to rising prices, more buyers are being forced into semi-detached, townhome and apartment categories and detached is only making up about 45% of the sales this year in Calgary.
- At the end of Q2, the benchmark price sat at $767,600. At the end of Q3, the number is $757,100, a drop of 1.4%, however still up 8.8% year-over-year.
- Days on market has risen from a low of 18 in May to 27. Still low compared with historical averages but sellers are needing a bit more patience on the market.
Semi-Detached Homes
- An increasingly popular housing type in both the suburbs and inner-city, sales and prices have been very strong in this property type the last few years.
- At the end of Q2, the benchmark price sat at $686,100. At the end of Q3, the number is $678,400, a drop of 1.1%, however still up 9.5% year-over-year.
- The number of sales actually rose from August to September, showing continued strength in this sector.
Townhomes
- Rowhomes have the lowest months of inventory of all sectors right now with 1.98.
- At the end of Q2, the benchmark price sat at $464,600. At the end of Q3, the number is $459,200, a drop of 1.2%, however still up 10.2% year-over-year.
- Some condo buyers are pushing into the townhome market now that interest rates have started to fall and their purchasing power has increased, propping up demand in this sector.
Apartments
- Apartments are seeing the softest market conditions of all sectors, with 3.2 months of inventory and an average of 33 days on market.
- Despite this, we haven’t seen prices dropping yet – at the end of Q2, the benchmark price sat at $344,700. At the end of Q3, the number is $345,000, virtually flat and still up 13.9% year-over-year.
- We are seeing more price reductions on the market now, however many sellers are still feeling confident about the Calgary market and are sticking to their price.
Oftentimes the best time to buy is simply when it is the right time for your lifestyle. If you are both buying and selling, you are moving within the same market. If you are only buying, then considerations such as interest rates, where you are currently living (and how much you are paying) and availability of what you want on the market become more important.
We are happy to chat through all of these options with you, please reach out anytime.
