Calgary’s real estate landscape in 2023 was characterized by robust sales, unique shifts in buyer preferences, and persistently low supply, making it a dynamic year for both buyers and sellers.
In this blog post, we delve into the key trends that shaped the market and explore the factors that drove housing prices throughout the year.
Sales Trends and Shifts in Preferences
Despite higher lending rates impacting overall housing demand, Calgary witnessed a substantial 27,416 sales in 2023. This figure, although a slight easing from the previous year’s peak, remained significantly higher than long-term trends and pre-pandemic activity levels. Interestingly, there was a notable shift towards more affordable apartment-style condominiums, reflecting the adaptability of the market to changing conditions.
Chief Economist Ann-Marie Lurie from CREB® highlighted the impact of strong migration levels, which helped maintain robust housing demand, especially for affordable options. However, this demand was met with persistently low supply levels throughout the year, creating a scenario of stronger-than-expected price growth.
Supply Challenges and Price Growth
Inventory levels consistently lagged behind long-term trends, with an average 44% decline over the 10-year average. The months of supply, particularly for homes priced below $1,000,000, remained well below two months for most of the year. This tight supply-demand dynamic contributed to the city achieving a new record high price.
While the annual benchmark price growth slowed from 12% in 2022 to nearly 6% in 2023, the price growth remained robust, especially when compared to other markets in the country.
Market Segment Insights
Detached Homes:
Despite a significant annual decline of nearly 20% in sales activity, the detached market experienced further price growth, averaging almost 8% in 2023.
Limited supply choices in lower price ranges prompted consumers to explore alternative housing styles, with significant gains in the city’s most affordable districts.
Semi-Detached Homes:
Sales for semi-detached homes declined by 10% in 2023, driven by pullbacks in the lower price ranges.
Persistently tight market conditions led to an annual benchmark price rise of 7%, varying across districts.
Row Homes:
Limited supply choices in lower price ranges contributed to an 11% decline in annual sales.
Conditions favored sellers, supporting an annual benchmark price gain of over 13%.
Apartment Condominiums:
Apartment-style properties reported a record high of 7,884 sales in 2023, driven by higher starting inventory levels and gains in new listings.
The annual benchmark price rose by over 13%, reaching a new record high of $321,400 by December.
Regional Market Overview
Airdrie:
Sales in Airdrie declined by 24%, primarily due to pullbacks in detached homes.
Conditions favored sellers for the third consecutive year, leading to a nearly 5% annual benchmark price increase.
Cochrane:
Both sales and new listings in Cochrane fell, impacting overall supply.
Despite some improvement in inventory levels, conditions remained relatively tight, resulting in a 4% increase in detached benchmark prices.
Okotoks:
Supply challenges persisted in Okotoks, influencing sales and prices.
Despite some monthly variation, prices generally trended up, with an annual increase of over 6%.
Conclusion
Calgary’s real estate market in 2023 demonstrated resilience, adapting to higher lending rates, migration patterns, and shifting buyer preferences. Despite challenges, price growth remained strong, setting the stage for an intriguing landscape in the years to come.
For prospective buyers and sellers, understanding these market dynamics is crucial for making informed decisions.
If you have questions or need guidance in navigating Calgary’s real estate market, please feel free to reach out to us!
Stay tuned for more insights into the ever-evolving world of Calgary’s real estate!
