The Calgary Real Estate Board (CREB®) has released its Q2 2023 Housing Market Report. The report highlights a dynamic real estate landscape in the City of Calgary, showcasing strong trends in sales, demand and pricing.
As expected, sales activity has slowed from last year’s record-breaking pace while staying stronger than long-term trends. What was not expected was the robust demand in the higher price segments of the market despite higher lending rates.
“An influx of migrants coming from Ontario and British Columbia are likely contributing to some of the strength for higher priced properties, as the relative affordability could make migrants less sensitive to the recent gains in lending rates, said CREB® Chief Economist Ann-Marie Lurie. At the same time, continued strength in our labour market is supporting demand across all property types.”
However, the robust demand is met with a shortage in supply. Housing inventory levels have remained notably low across various segments, encompassing the resale, new home, and rental markets. Despite relatively strong new home starts, these have not been sufficient to alleviate inventory constraints, primarily due to the influx of migrants. Resale supply has also encountered unexpected challenges, as higher lending rates and limited choices in supply have deterred existing homeowners from making changes.
The prevailing shortage in supply has contributed to the continuation of tight market conditions, which has led to stronger-than-expected price growth across all property types in the city. This steady appreciation in prices throughout the year has effectively offset declines observed in the latter half of 2022, ultimately resulting in new record-high prices.
“Home prices have exceeded our expectations as supply challenges have persisted throughout the spring market, added Lurie. “While the pace of monthly gains is expected to slow in the second half of the year, limited supply choice is expected to keep prices elevated throughout the second half of the year.”
Source: CREB®’s Q2 2023 Calgary & Region Quarterly Update Report