Pete: Hey everyone, it’s Pete and Hi, it’s Kate . We’re gonna give you a market update for February of 2023. And it’s pretty interesting, so standby. By the way, at the end, we’re gonna go back to doing the highest price sale in February and the lowest price sale in February as well. So, and both of those are super intriguing because there’s actually a connection between the two.
Yes. Isn’t there? Yeah. It’s really strange.
Here’s what’s going on in the market and what we’re gonna do is we’re gonna talk about inventory first listings and sales and that kind of stuff because if you understand supply and demand, then we can see what’s going on with the pricing. Right, exactly. So in terms of that, here’s what’s going on.
Sales in, in across the Calgary Real Estate Board are down 47%. And so we’re down to 1,740 sales for the whole month across the city. And that sounds really, really bad. But there’s two things to keep in mind with those. One of them is we sold a ton in February of last year. Also when you considered the month that inventory has gone down, it’s actually it hasn’t really affected pricing at all. Or has it? So Kate, what about inventory levels though? Because we did talk about how sales are down almost 50%. What about inventory?
Kate: Yeah, so actually new listings are down about almost 50% compared to last year, which makes inventory down about around 25%. And it’s actually been the lowest since 2006. So that’s 17 years. Yeah. Of it being the lowest.
Pete: Crazy. That’s crazy. So we’ve seen sales drop, but we’ve seen inventory drop about the same amount. Yeah. So you’re, we’re gonna get to what that, what the effect has been on pricing in a second. Yes. But what we’re left with is we’re left with just over a month and a half supply across the whole city.
And what that means, of course, is that if we stop listing homes in a month and a half, we’d have nothing left whatsoever. And of course, within the varying market segments, that’s even different. So is it within apartment? , was it apartments or townhouses? We actually have one month supply.
Kate: It was townhouses.
Pete: We’ve only got a one month supply of those. That’s it. So expect for the price increases in townhouses. So Kate, what’s going on in terms of pricing as a result of this?
Kate: Yeah, so in terms of pricing for detached the detached market new listings are down 60%, which means that inventory is down also 24%. But that’s actually bumping the prices up. I know it’s only a two and a half percent. But it’s actually you know a little bit.
Pete: We’re going back in the right direction. Right? Yeah. Like cuz, because detached homes have actually been declining in price a little bit over the last few months. Exactly.
So we’ve sort of hit the bottom of that and we’re, it looks like we’re bouncing back a little bit, so that’s good.
Kate: And so what’s going on with the semi-detached?
Pete: The semi-detached are, so these ones are not townhouse. These are the ones that’s like a half duplex in these kind of places.
About the same. They’re, they’re up about two and a half percent as well. So again, prices are going up. And that’s the good news, especially when you look across the country and there’s bad news and negative news everywhere. Yeah. But it’s only up two and a half percent, but, you know, year over year, that’s not bad considering market conditions and stuff like that.
And again, that’s reflective of a really low I. . What about Rowhouses, Kate? What’s going on there with pricing?
Kate: So with rowhouses, it’s actually, oh my goodness. The inventory for all of Calgary, the total inventory has actually declined 39%. That’s almost 40%. Yeah, that’s, that means, like we were talking about earlier, it’s the one month supply out of all of the different markets that we have, and it’s actually an increase in price from last year to about 9%.
Pete: Yeah, like 10% increase in a price. That’s, that’s crazy. Is is pretty good. Like I said, especially considering what’s going on across the country. Yeah. We’re pretty blessed to be here right now. In terms of apartments, same kind of thing. In fact, apartments have even skyrocketed more, which, if you remember, if you’d been watching our market updates for a few months, I’d been saying what happened.
Yes. People were saying, no, no, no, it’s not gonna happen. The interest rates are gonna fill, the market price gonna come down. I’m gonna wait. You know? Anyways, what we’ve seen now is over 11% price increase in apartments to the point where, where we’ve seen like the downtown market has been hurting for a long time.
Prices across downtown are even going up. And that’s been a long time coming cuz you know, with with so many vacant apartments down there for so long, it’s been a really, really tough market. But like I said, apartments in general up over 11% Wow. Year over year. And I predict that’ll continue because again.
You know, we’re seeing, you know, near a hundred percent sales listing ratios with apartment. Still. Yeah. So everything that’s being listed with apartments is being sold. I’m hearing realtors complain all the time. They’re looking for apartments for clients downtown. Oh. And can’t find anything. So it’s been really, really tough.
All right. So in terms of prices across the city, I’ll add this is there’s only one area of the city that’s actually seen price decline still from last year and that’s the west. So, not necessarily the whole Southwest, but the whole like Spring Bank area and all that hasn’t gone down much.
It’s gone down 1%, but every other area of the city is going up in price. And of course that’s a reflection again, of how the market’s been changing as a result of the price as a result of the interest rate hikes. So that’s of course affecting higher priced homes, more than the lower priced homes.
And there’s a lot of higher priced homes in the in that area of the city. So, all right, so in terms of the highest price sale in Calgary, what is it, Kate?
Kate: It actually sold in Bel Air. Now this says a story, I don’t know if you guys know the song, but played in the background . So the highest price sale.
Highest price home that sold back in February was actually sold in Bellaire. Yeah. By Dennis Klinz. Yeah. Shout out to Dennis. It was actually listed for five and a half million, reduced to 4.4, but sold for 3.9.
Pete: Someone got a deal. Yeah. Or it was price might , but either way somebody paid almost 4 million for a house in million dollars.
Kate: It does appear to be some sort of foreclosure.
Pete: Yeah. It’s a court of King’s bench deal. Som not sure what the story Oh no. It was a selled by a bailiff company. Yes. Something like that. Yeah. Anyways, super interesting and what’s unique about this is that this is the first month we’ve ever done highest and lowest price sale.
Yeah, yeah. But they were both kind of in the same situation. The other was some kind of a court of Kings bench. It was a Court of Kings Bank sale? Yes. And it was in the Northwest. and that one. Get this you people from Vancouver and Toronto. It was listed for $68,000 and it sold for $55,100.
Pocket change. Pocket change. Literally, gosh, that was a one bedroom and but in a great location actually backing onto a park and all that stuff. Not sure what the deal is with that one, but yeah, that’s right. You can still buy condos and Calgary for $55,100. That’s amazing. So if you’re still thinking of moving out or if you’ve got kids or relatives that are thinking of moving out.
Call us. We’d love to help them. We love selling properties for $55,000. We think it’s hilarious. And, but we’d also love to sell homes for 3.9 million. Oh, that’d be good too. Yeah you know, what is, we don’t really care about the price. We care about the people. Right. Exactly. If you’re good folks, we wanna work with you.
Exactly. So anyways, give us a shout when you’re thinking of moving. Or if you know someone that is, we’d love to be able to help ’em out. In the meantime, that’s our market update for February of 2023. And love to hear from you and call us anytime.
Kate: See ya.
Pete: I held that longer than you.
Lowest February inventory since 2006
Consistent with typical seasonal behavior sales, new listings and inventory levels all trended up compared to last month. However, with 1,740 sales and 2,389 new listings, inventory levels improved only slightly over the last month and remained amongst the lowest February levels seen since 2006.
“While higher lending rates are impacting sales activity as expected, we are seeing a stronger pullback in new listings, keeping supply levels low and supporting some stronger-than-expected monthly price gains,” said CREB® Chief Economist Ann-Marie Lurie. “Prices are still below the May 2022 peak and it is still early in the year. However, if we do not see a shift in supply, we could see further upward pressure on prices over the near term.”
Both sales and new listings declined over last year’s record high for the month. While sales activity remained stronger than long-term trends and levels reported throughout the 2015 to 2020 period, new listings fell below long-term trends.
With a sales-to-new-listings ratio of 73 per cent and a months of supply of under two months, the market has struggled to move into balanced territory causing further upward pressure on home prices. The unadjusted benchmark price increased by nearly two per cent over January levels and last year’s prices.
Both sales and new listings reported significant year-over-year declines over last year’s record high. While the seasonal monthly gain did see inventories move up over the last two months, levels are still amongst the lowest seen in February, and the months of supply fell below two months.
Further tightening conditions did cause the unadjusted benchmark prices to rise over last month’s levels, but at a price of $635,900, it is still below the peak reported in May 2022. While supply continues to remain a challenge relative to demand for lower-priced homes, we are seeing conditions shift into balanced territory for homes priced above $700,000.
Like the detached sector despite the seasonal monthly gain, both sales and new listings fell from last year’s record high. While inventories are starting to rise over the levels seen in the past few months, they remain amongst the lowest levels reported for February. The relatively low inventory levels caused the months of supply to fall below two months in February, while it is still higher than last year’s ultra-low levels, conditions continue to favour the seller.
The unadjusted benchmark price reached $568,100 in February, nearly two per cent higher than last month and a three per cent gain over last February. Persistently tight market conditions contributed to the monthly unadjusted gain in the benchmark price. However, like detached properties prices remain below the May 2022 peak.
Conditions remained exceptionally tight in February with only one month of supply and a sales-to-new listings ratio of 87 percent. While row sales have eased over record levels, they have remained relatively strong for February as demand shifts toward the affordable product in the market.
The persistently tight conditions caused further upward pressure on prices. In February, the unadjusted benchmark price reached $369,700, a monthly gain of over two per cent and a year-over-year gain of nine per cent. Unlike the other sectors, prices have reached a new high this month.
Sales for apartment condominiums did not see the same pace of decline as other property types in February partly due to the level of new listings coming onto the market. Persistently strong sales compared to listings have caused February inventory levels to remain relatively low compared to levels seen over the past eight years and the months of supply once again dropped below two months.
The tight market condition contributed to the upward pressure on prices. In February, the unadjusted apartment benchmark price reached $286,000, nearly three per cent higher than last month and over 11 per cent higher than last February. While prices are still higher than the levels reported last year, they remain nearly seven per cent below the peak levels reported back in 2014.
REGIONAL MARKET FACTS
Inventories continued to improve in February but with only 178 units available levels are still well below longer-term trends for the month ensuring that the months of supply remained below two months.
The unadjusted benchmark price in February rose over last month keeping it comparable to levels seen last year at this time. However, with a benchmark price of $487,200, prices remain below the peak price of $510,700 reported in April 2022.
Like Airdrie, inventory levels have also been on the rise in Cochrane. While February levels are double what was available in the market last year, inventories remain over 40 per cent below long-term trends for the month. Nonetheless, both sales and new listings have eased so far this year helping the market shift toward more balanced conditions.
The February benchmark price did improve both over last month’s and last year’s levels. However, with an unadjusted price of $492,900, levels are still below the $522,600 peak reached in June of 2022.
While both sales and new listings have slowed compared to last year, conditions remained exceptionally tight with a sales-to-new listings ratio of 90 per cent. Inventory levels also continued to fall both compared to last month and last year, with levels nearing the February 2006 record low.
As conditions continue to favour the seller, it is not a surprise that we continue to see upward pressure on home prices. In February, the unadjusted benchmark price reached $555,000, three per cent higher than last month’s and last February’s levels. However, like some areas, prices remain just shy of the May peak of $560,700.
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