Calgary Real Estate Market Update - November 2022

Looks Like 2022 Will Go Down as a Record Year for Residential Sales

Home sales in Calgary slowed down to just 1,648 units in November, which was a 22% year-over-year decline, but still 12% higher than the city’s 10-year average.
The past six months’ pullback in sales was not sufficient to eradicate the gains made earlier this year. So, the year-to-date sales figures are still almost 10% above 2021’s record high. This growth was clearly driven by the uptick in sales of condominiums and apartments, as well as row houses.
Ann-Marie Lurie, CREB® Chief Economist, says that “Easing sales have been driven mostly by declines in the detached sector of the market. “Higher lending rates are impacting purchasers buying power and limited supply choice in the lower price ranges of the detached market is likely causing many purchasers to place buying decisions on hold.”
Declining sales met up with fewer new listings with inventories plunging to the lowest reported level in November since back in 2005. As a result of these two factors, the months of supply is fairly tight at just under two months. Because the growth in supply has primarily been driven by gains in more expensive properties, the tightest market conditions are in lower priced properties.
Despite the tight market conditions, prices are still trending down from this year’s highs back in May. Even after factoring in the adjustments, benchmark prices in November are still almost 9% higher than last year’s reported levels.

HOUSING MARKET UPDATES

Detached Homes
Sales of detached homes slowed down in all price ranges in November, which factored into the year-over-year decline of almost 34% and a 5% decline year-to-date. As far as year-to-date figures are concerned, sales have softened for homes under $500,000 due to the number of new listings priced in this range has plunged by more than 36%, which limits the choices for buyers in search of an affordable home.
In the meantime, new listings and supply options improved for properties priced in the higher ranges, resulting in more balanced market conditions in the upper price ranges. This means that there are different implications regarding the market’s price pressure.
November’s benchmark price was $619,700, which is down from last May’s high of $648,500. Although prices have softened over the last few months, they are still almost 11% above 2021 levels.

Semi-Detached Homes
The decline in sales of semi-detached homes in November was sufficient to cause a softening of year-to-date sales by almost 1% compared to 2021. Despite the recent pullback, year-to-date sales are still 37% higher than long-term averages in Calgary.
November’s softening sales were met with a decline in new listings, leading to even lower inventory levels, which will keep market conditions fairly tight since the month of supply is only two months while the ratio of sales-to-new-listings is 100%.
Unlike what occurred in the detached sector, these tight market conditions kept any further reductions in prices at bay in November. The benchmark price in November for semi-detached homes reached $562,800, a little higher than in October, and almost 10% higher than 2021 levels.

Row Houses
Sales were slower in November, likely due to continuing declines in new listings. But the ratio of sales-to-new-listings is still high at 99%. Inventory levels of row houses plunged to 383 units, which is the lowest November inventory level recorded since 2013. This level ensured a months of supply of under two months.
Despite ongoing tight market conditions for row houses, prices kept going down in November, to $358,700. Although prices have softened since June’s high, they are still almost 14% higher than they were in November 2021. The strongest growth in prices occurred in the South East, North, North East districts, where prices have gone up by more than 18%.

Condominiums & Apartments
Despite new listings declining in November, condominium and apartment sales kept rising, with inventories dropping to the lowest levels in November since 2013. This led to even tighter market conditions as the ratio of sales-to-new-listings rose above 100% while the months of supply plunged to just two months.
The tightening market conditions of recent months has caused prices of condominiums and apartments to remain relatively the same in November, at $277,000 compared to the previous month. Although there has been a gain year-over-year of almost 10%, prices remain lower than the previous highs of 2014.

REGIONAL MARKET UPDATES

Airdrie
Sales in November softened primarily because of a major decline in sales of detached homes. Although November sales are lower than the record levels of 2021, overall sales are still much stronger than trends long term and sales year-to-date remain on pace to break records.
New listings increased over 2021, due to gains in semi-detached homes, condos and apartments, and row houses. Although the increase in new listings caused a rise in November inventory levels over 2021, inventory levels are still almost 40% lower than long-term trends in Airdrie.
Despite ongoing tight market conditions, benchmark prices keep going down from the record highs of last April. Even though there were some price adjustments, they are still more than 13% higher than 2021 levels.

Cochrane
There were further declines in sales in November, which contributed to a year-to-date sales decline of 6%. But, there were already 1,091 home sales in 2021, which means that these figures are still 69% higher than long term trends for Cochrane.
In the meantime, new listings are still fairly low when compared to sales, standing in the way of a major rise in inventory levels. While November levels did rise above the lows of 2021, inventory levels were still 35% lower than long term trends for Cochrane.
After significant price gains earlier this year, benchmark prices kept trending down in November. On the other hand, these adjustments were not sufficient to eradicate previous gains, so the benchmark price is still more than 12% higher than in 2021.

Okotoks
There was a softening of both new listings and sales in November, which prevented any major shift in inventory levels. Although inventory levels remain higher than in 2021, they are still 54% lower than long-term trends in Okotoks. Year-to-date sales overall are higher than in 2021, and as for long-term trends, they are 41% higher.
Since market conditions remained fairly tight in November, Okotoks experienced a reversal of some price adjustments over the last two months. November’s benchmark price came to $549.100, which is 2% higher than in October’s, and a year-over-year gain of almost 16%.