The Calgary real estate market continues to defy expectations as home prices reach unprecedented heights. Despite rising interest rates, the market has maintained momentum, with July witnessing a remarkable seventh consecutive monthly gain. This surge in activity has been driven mainly by the apartment condominium sector, which has seen significant gains in demand due to its relative affordability. This blog will explore the key factors behind this remarkable trend and the implications for buyers, sellers, and Calgary’s overall real estate landscape.
Strong Demand and Record Sales Figures
July 2023 was a landmark month for the Calgary real estate market, with 2,647 home sales recorded. This represents an impressive 18 percent year-over-year gain, making it the strongest July sales level reported on record. The influx of migration to the province, combined with the region’s affordability, has significantly fueled the demand for housing, even in the face of higher lending rates.
Affordable Apartments Drive Market Pace
One of the standout contributors to the record-setting pace is the apartment condominium sector. Thanks to their relative affordability, apartments have become popular with prospective buyers. As a result, year-to-date sales experienced a decline of 19 percent compared to last year. Still, the apartment market has shown resilience with a remarkable 16 percent year-to-date gain in sales activity.
Inventory Levels Remain Tight
Despite the seasonal dip in sales and new listings in July 2023, inventory levels have remained near a historic low, last seen in 2006. With a sales-to-new-listings ratio of 82 percent and only 1.3 months of supply, conditions have favoured sellers, giving them an upper hand in negotiations.
Upward Pressure on Home Prices
The persistent imbalance between supply and demand has led to further upward pressure on home prices in Calgary. In July 2023, the unadjusted total residential benchmark price reached an all-time high of $567,700, marking a staggering seventh consecutive monthly gain. This translates to a price increase of over four percent compared to the previous peak in May 2022.
Diverse Growth in Different Property Types
Breaking down the market by property types, we can observe distinct trends in each category:
1. Detached Homes: The detached home segment experienced a monthly gain of nearly one percent in July 2023, with the unadjusted benchmark price reaching $690,500. Both year-over-year and monthly price growth were most robust in the city’s most affordable North East and East districts.
2. Semi-Detached Homes: The semi-detached market saw the most significant monthly gains in the North East and East districts, rising by over two percent compared to June 2023. The City Centre district experienced price stability. The unadjusted benchmark price for semi-detached homes reached $616,800 in July 2023.
3. Row Properties: Row properties enjoyed robust demand, with the benchmark price reaching $407,500, a monthly gain of nearly two percent and a 14 percent increase compared to prices reported last July. Price gains were observed across all districts, with the highest growth seen in the west district.
4. Apartment Condominiums: This property type emerged as the only one to report a year-to-date gain in sales activity, up 16 percent compared to last year. Despite recent gains in new listings, the apartment condominium market remains tight, with a sales-to-new-listings ratio of 84 percent and a month of supply at 1.4 months. The unadjusted benchmark price for apartments reached $305,900, indicating a strong month-over-month increase of almost one percent and a substantial 12 percent growth compared to last July.
The Calgary real estate market reached new heights in July, with record sales figures and soaring home prices. Despite rising interest rates, the demand for housing remains robust, driven by migration to the province and the relatively affordable apartment condominium sector. Buyers should be prepared for competitive conditions as the market continues to favour sellers due to tight inventory levels.
Looking ahead, experts and analysts will closely monitor how the market evolves, considering factors such as migration patterns, lending rates, and housing supply. For now, homeowners in Calgary can celebrate their property’s rising value, while prospective buyers must navigate a competitive landscape to secure their dream homes. As the market dynamic continues to shift, it is essential for all to stay informed and adapt their strategies to make the most of Calgary’s ever-evolving real estate market.
Click here to explore the detailed monthly stats package for the City of Calgary.
