The Calgary Real Estate Board (CREB®) has released its Q2 2024 housing market report, providing an overview of the real estate landscape in Calgary and surrounding areas. The report showcases trends in sales and pricing, offering valuable insights for industry professionals and prospective homebuyers and sellers.

The latest data reveals that new listings have risen for the fourth consecutive quarter compared to the previous year. Much of the gains have occurred in the upper price ranges of each property type, as rising prices and persistently high lending rates are encouraging more sellers to list their properties. The increase in new listings compared to sales caused the sales-to-new listings ratio to fall below 80 percent for the first time since Q1 2023. While this shift has supported some inventory gains, it is important to note that the market continues to favour sellers with a Q2 sales-to-new-listings ratio of 75 percent and a months-of-supply of one month.

In the second quarter, sales slowed by three percent compared to the same period last year. The decline was driven by lower-priced properties, where supply levels are the lowest. Despite this slowdown, sales levels remained 29 percent above long-term trends. After the first half of the year, sales were nearly six percent higher than last year's levels.

“The unexpected surge in migration over the past two years has contributed to the demand growth and supply challenges experienced in the Calgary market,” said Ann-Marie Lurie, Chief Economist at CREB®. “While we still have to work through the pent-up demand, slowing migration levels and supply gains in the resale and new home markets should start to support more balanced conditions, taking some of the pressure off home prices.”

So far this year, home prices have risen by 10 percent, with the most significant gain occurring in row properties at 19 percent and the lowest growth of 13 percent in detached and semi-detached homes. Moving forward, increased supply generated through the new home sector will help support a better-supplied rental and ownership market, reducing pressure on home prices. Slowing price growth is anticipated throughout the second half of the year as supply levels improve. However, conditions will vary based on property type and price range. Much of the supply growth is expected to impact higher-priced properties, slowing their growth. Meanwhile, persistently tight conditions for the most affordable properties will continue to drive further price increases.

For the full report, please download CREB®’s Q2 2024 Calgary & Region Quarterly Update Report HERE

Courtesy CREB®️

JUNE 2024 HOUSING MARKET UPDATE

July 2, 2024

City of Calgary, July 2, 2024 — Sales in June reached 2,738, marking a 13 percent decline from last year’s record high. Although sales improved for homes priced above $700,000, it was not enough to offset the declines reported in the lower price ranges. Despite the easing in June sales, they remain over 17 percent higher than long-term trends.

“The pullback in sales reflects supply challenges in the lower price ranges, ultimately limiting sales activity,” said Ann-Marie Lurie, Chief Economist at CREB®. “Inventory in the lower price ranges of each property type continue to fall, providing limited choices for potential purchasers looking for more affordable product. It also continues to be a competitive market for some buyers with over 40 per cent of the homes sold selling over list price.”

This month, new listings also eased relative to sales, causing the sales-to-new-listings ratio to remain elevated at 72 per cent. Inventory levels did improve over last year’s low levels, primarily due to gains in the higher price ranges. However, with 3,789 units available, levels remain 40 per cent lower than long-term trends.

The modest change in inventory levels helped increase the months of supply. However, at 1.4 months, conditions continue to favor sellers. Persistently tight conditions drove further price gains this month. In June, the unadjusted benchmark price rose to $608,000, a gain over last month and nearly nine per cent higher than last year. Prices rose across all districts, with the most significant year-over-year gains occurring in the North East and East districts.

Detached

 Gains in higher-priced detached home sales were not enough to offset the pullbacks for homes priced below $700,000, leading to a 16 per cent year-over-year sales drop. Despite the recent pullback, detached home sales for the first half of the year remain in line with levels reported last year. Meanwhile, following several months of gains, new listings eased this month. By the end of June, there were 1,775 detached homes in inventory, an improvement over last year but 45 per cent below long-term trends for the month.

While conditions remain tight in the detached market, we are starting to see better supply and demand balances in the upper end of the market. The months of supply have ranged from a low of one month in the most affordable East district to just over two months in the City Centre. Nonetheless, with less than one and a half months of supply, we continue to see upward pressure on home prices. In June, the unadjusted benchmark price reached $767,600, nearly one per cent higher than last month and 12 per cent higher than prices reported last June.

 Semi-Detached

Following a significant gain last month, new listings pulled back in June relative to sales, causing the sales-to-new-listings ratio to rise to 76 per cent. While this did not prevent some gains in inventory levels, inventory levels remained nearly half of those traditionally seen in June.

With just over one month of supply, we continue to see upward pressure on home prices. In June, the unadjusted benchmark price reached $686,100, a one per cent gain over last month and over 12 per cent higher than levels reported last year. Prices rose across all districts in the city, with the steepest gains occurring in the most affordable areas of the North East and East districts.

 Row

Like other property types, row home sales slowed in June relative to the high levels achieved over the past two years. A higher pullback in sales compared to new listings caused the sales-to-new-listings ratio to fall to 75 per cent, the lowest June level reported since 2021.

However, conditions remain exceptionally tight with one month of supply, especially for properties priced below $600,000. The unadjusted benchmark price trended up in June, reaching $464,600, nearly 17 per cent higher than levels reported last year at this time. While price adjustments have varied depending on location, we continue to see the highest price growth occurring in the most affordable districts. 

 Apartment Condominium

There were 791 sales in June, a nearly eight per cent decline over last year. The decline in sales was primarily due to the significant pullback for units priced below $300,000. Limited supply choice for lower priced products is preventing stronger sales activity. Despite the monthly pullback, year-to-date apartment sales are up by 13 per cent, and are at record-high levels.

New listings continue to rise relative to sales, causing the sales-to-new-listings ratio to fall and driving further inventory gains. However, much of the supply growth has occurred for higher-priced properties, resulting in tight conditions at the lower end of the market and more balanced conditions for higher-priced units. Overall prices continued to trend up this month, reaching $344,700, over 17 per cent higher than last year.

 REGIONAL MARKET FACTS

Airdrie

June sales remained relatively stable compared to last year at levels that remain well above long-term averages. At the same time, we saw a boost in new listings this month compared to last year. However, with 269 new listings and 209 sales, the sales-to-new-listings ratio remained elevated at 78 per cent, keeping inventories relatively low based on historical standards.

Like Calgary, Airdrie is experiencing the tightest conditions for the most affordable sectors of the market, and prices continue to rise. In June, the unadjusted benchmark price rose to $554,500, nearly one per cent higher than last month and nine per cent higher than last year’s levels. Price growth has been the highest for apartment-style properties.

 Cochrane

June sales improved over last year’s levels, contributing to the year-to-date gain of seven per cent. This was possible thanks to the boost in new listings in June. However, the gains in new listings did little to impact the inventory levels, which remained consistent with levels reported last year and are 44 per cent lower than levels we typically see in June.

With nearly one and a half months of supply, conditions continue to favour the seller, driving further price gains this month. In June, the unadjusted benchmark price was $571,100, an increase over last month and nearly nine per cent higher than last year’s levels. Like Airdrie, the price growth was strongest for apartment-style units, which are also the most affordable products available in the town.

Okotoks

Sales in June slowed compared to last year, mostly due to a pullback in the detached sector. Sales activity has been somewhat restricted due to the limited supply options. As of June, there were 81 units in inventory, 56 per cent lower than levels we typically see in the month, and detached supply is nearly 63 per cent lower.

Persistently tight market conditions have kept prices elevated compared to last year. While there has been some monthly fluctuation, year-to-date prices are nearly nine per cent higher than last year’s levels.

Click here to view the full City of Calgary monthly stats package.

Click here to view the full Calgary region monthly stats package.

Courtesy CREB®️

After last year’s cooldown in the Canadian real estate market, prices have been edging higher on solid demand, tight supply, and expectations regarding lower interest rates. Today, the average price for a home in one of the world’s hottest housing industries is a little bit more than $700,000. Despite widespread attention the issue has been given by all three levels of government, housing affordability continues to be challenging. While all the focus has been on prices in places like Toronto and Vancouver, many smaller markets have become expensive.

Are prospective homebuyers doomed? Not at all! According to the RE/MAX 2024 Canadian Housing Market Outlook report, 41 percent of markets are expected to regain balance, and more than one-quarter (28 percent) are anticipated to favour sellers. Put simply, there are plenty of opportunities in Canada’s real estate sector to find a home that suits your budget.

Affordable Canadian Real Estate, Defined

Before we get into the “where” of the most affordable Canadian real estate, let’s take a look at what it actually means.

Traditionally, housing affordability is defined as households spending 30 percent or less of their total income on shelter. In recent years, however, a wide range of studies have discovered that many homeowners and renters are allocating more than 30 percent of their earnings to keeping a roof over their heads.

But where are the places in Canada that offer some semblance of affordability? Using the average six-percent mortgage rate, let’s examine ten affordable housing markets in Canada.

10 Most Affordable Places to Buy Canadian Real Estate

1. Red Deer, Alberta

• Average Home Price: $378,775

• 20% Down Payment: $75,755

• Mortgage Amount: $303,020

• Monthly Mortgage Payment: $1,938

• Average Monthly Income (before taxes): $8,666

• % of Monthly Income Allocated to Mortgage: 22.4 percent

2. Regina, Saskatchewan

• Average Home Price: $319,800

• 20% Down Payment: $63,960

• Mortgage Amount: $255,840

• Monthly Mortgage Payment: $1,636

• Average Monthly Income: $7,032

• % of Monthly Income Allocated to Mortgage: 23.3 percent

3. Brandon, Manitoba:

• Average Home Price: $340,000

• 20% Down Payment: $68,000

• Mortgage Amount: $272,000

• Monthly Mortgage Payment: $1,740.

• Average Monthly Income: $7,034

• % of Monthly Income Allocated to Mortgage: 24.7 percent

4. Edmonton, Alberta

• Average Home Price: $431,387

• 20% Down Payment: $86,277

• Mortgage Amount: $345,110

• Monthly Mortgage Payment: $2,269

• Average Monthly Income: $11,931

• % of Monthly Income Allocated to Mortgage: 19 percent

5. Thunder Bay, Ontario

• Average Home Price: $350,000

• 20% Down Payment: $70,000

• Mortgage Amount: $280,000

• Monthly Mortgage Payment: $1,791

• Average Monthly Income: $7,026

• % of Monthly Income Allocated to Mortgage: 25.5 percent

6. Saskatoon, Saskatchewan

• Average Home Price: $339,800

• 20% Down Payment: $67,960

• Mortgage Amount: $271,840

• Monthly Mortgage Payment: $1,739

• Average Monthly Income: $8,620

• % of Monthly Income Allocated to Mortgage: 20.1 percent

7. St. John’s, Newfoundland

• Average Home Price: $342,500

• 20% Down Payment: $68,500

• Mortgage Amount: $274,000

• Monthly Mortgage Payment: $1,753

• Average Monthly Income: $8,552

• % of Monthly Income Allocated to Mortgage: 20.5 percent

8. Moncton, New Brunswick:

• Average Home Price: $305,100

• 20% Down Payment: $61,020

• Mortgage Amount: $244,080

• Monthly Mortgage Payment: $1,561

• Average Monthly Income: $5,954

• % of Monthly Income Allocated to Mortgage: 26.2 percent

9. Calgary, Alberta

• Average Home Price: $603,700

• 20% Down Payment: $120,740

• Mortgage Amount: $482,960

• Monthly Mortgage Payment: $3,090

• Average Monthly Income: $11,743

• % of Monthly Income Allocated to Mortgage: 26.3 percent

10. Winnipeg, Manitoba

• Average Home Price: $430,099

• 20% Down Payment: $86,019

• Mortgage Amount: $344,080

• Monthly Mortgage Payment: $2,263

• Average Monthly Income: $9,015

• % of Monthly Income Allocated to Mortgage: 25.1 percent

Average home prices based on local real estate association boards

Average monthly income based on Statistics Canada

Monthly mortgage payment based on six percent mortgage rates

The Good News and the Bad News About Affordable Housing

According to a recent RBC report, the Canadian housing market has never been less affordable. In the fourth quarter of 2023, a median household would need to spend 63.5 percent of its income to carry a mortgage on the typical home; this is up 1.7 percent from the previous quarter. By comparison, during the 1990s housing bubble, the figure was 57 percent.

Affordability erosion was concentrated in the usual places, such as Vancouver (106.3 percent), Toronto (84.8 percent), and Victoria (80.2 percent). But while one of Canada’s largest banks sees affordability improving, the improvement might be tepid.

“Under our base case scenario, the share of an average household income needed to cover ownership costs would only fall to mid-2022 levels by 2025,” said Robert Hogue, assistant chief economist at RBC, in the April 2024 report. “Meaningfully restoring affordability will likely take years in many of Canada’s large markets. In this context, we expect the housing market’s recovery to be slow at first, before gaining momentum as interest rate cuts accumulate.”

That said, a new by the National Bank of Canada suggests that there has been “widespread” improvement nationwide on the housing affordability front.

According to the financial institution’s Housing Affordability Monitor, housing affordability, measured by the mortgage payment as a percentage of income for the median home price, was seen in each of the ten markets in the first three months of 2024.

For instance, in Toronto, mortgage payments as a percentage of income tumbled 5.7 percentage points to 82.4 percent. Or, as another example, mortgage payments in Vancouver declined 8.9 percentage points to 95.7 percent.

The chief hurdle in the Canadian real estate market is housing stocks. The housing supply deficit reached an all-time high in the first quarter of 2024 and has been in freefall since 2021.

“As a result, price dynamics for both purchases and rents should remain skewed to the upside in the current acute housing shortage,” the report stated.

So, what were the three most affordable markets based on the bank’s data? Winnipeg (31.7 percent), Edmonton (32.2 percent), and Quebec (32.7 percent).

Courtesy RE/MAX Canada

Taylor Swift is not only a powerhouse in the music industry but also a significant cultural influencer whose impact resonates far beyond the stage. Her Eras Tour, which has grossed a record-breaking $1 billion to date, has delighted fans worldwide and significantly impacted the economies of the cities that hosted her performances, including the housing markets.

Key Findings

Cities hosting Taylor Swift concerts saw home prices rise by an average of 2.1 percent, a substantial increase compared to the national average growth of 0.5 percent during the same period​. This was seen especially in Atlanta, where it increased by 8.8 percent following a concert​.

Taylor Swift’s concerts significantly boosted local economies through increased spending on accommodations, food, activities, and concert tickets. Concert-goers reportedly spent nearly $1,000 on average in the host cities​​.

Approximately one in five concert-goers surveyed expressed an interest in relocating to the city they visited for the concert. The most notable interest was seen in Houston, where 45 percent of visiting fans considered moving there​.

Taylor Swift’s Economic Impact on Host Cities

Taylor Swift’s Eras Tour has had a remarkable economic impact on the cities that hosted her performances. The presence of her concerts has led to significant increases in local housing markets, with an average home price rise of 2.1 percent in these cities, a stark contrast to the national average of only 0.5 percent.

In Atlanta, the increase in average home prices soared to 8.8 percent. Tampa experienced the second-largest boost from the Eras Tour with an 8.2 percent increase in home prices, while Glendale, Arizona, saw a 6.5 percent rise. Both cities actively embraced Taylor Swift and her tour. For instance, during the tour’s stop, Hillsborough County, which includes Tampa, temporarily rebranded itself as “Swiftsborough”; Glendale similarly renamed itself “Swift City.”

Beyond the real estate market, the tour brings substantial direct spending into these local economies. On average, fans spend nearly $1,000 during their visit, with expenditures spread across accommodations, dining, activities, and concert tickets. Specifically, this spending includes about $208 on accommodations, $121 on local activities, $145 on dining, and a significant $452 on concert tickets. This influx of spending provides a considerable boost to local businesses and injects a substantial amount of capital into the economy.

The heightened visibility and popularity of the host cities have led to sustained interest and investments long after the concerts have ended. The cities have remained desirable destinations for both tourism and permanent relocation, as surveys by Architectural Digest indicate that one in five concertgoers consider moving to the cities they visited for the shows. In Houston, this number increases to an astounding 45 percent.

Long-Term Effects for Canadian Tour Stops

What does this mean for Canada? Businesses in Vancouver are already preparing for the influx of visitors, with expectations of downtown areas being fully occupied during the December 6-8 concert dates. Local officials and business leaders predict that the fans will not only fill hotels but may also increase demand for short-term rentals, potentially driving up rental prices. This could lead to increased property values as investors and homeowners capitalize on the heightened demand​.

Toronto, having been announced earlier as a Canadian stop for the tour on November 14-23, anticipates similar economic impacts. Such a high-profile event can elevate interest in the city’s real estate, as visitors may consider long-term investments or relocation, influenced by their positive experiences during their stay. This increased interest can lead to a rise in home prices and rental rates, contributing to overall real estate market buoyancy.

Both cities are already preparing for challenges such as accommodation capacity and regulatory impacts on short-term rentals, which could further affect the real estate landscape. However, local officials express confidence in managing these challenges, emphasizing that the benefits of hosting such events extend beyond the immediate economic boosts to foster long-term growth and stability in their housing markets.

The economic and cultural impacts of Taylor Swift’s Eras Tour on host cities illustrate a broader phenomenon wherein major entertainment events can significantly influence local economies and urban landscapes. As the tour moves into Canada toward the end of 2024, Vancouver and Toronto are expected to demonstrate the same boost in local housing prices and urban economy.

Courtesy RE/MAX Canada

Let’s be honest: There is a lot of uncertainty in the current Canadian real estate market. Are home prices climbing, rising, or stagnating? Where will mortgage rates be by the end of the year? Will economic conditions improve as 2024 progresses? Indeed, there are many variables that buyers and sellers need to think about as they navigate through all the noise in the housing sector.

Research has shown that Canadian households understand that buying a home, whether a single-family house or a condo, is one of the best financial decisions you can make in your life. This is why young households are often encouraged to set their sights on home ownership, no matter what the current housing landscape looks like.

Put simply, now could be a terrific time to buy a house for the first time. Let’s comb through the various ways that buying a home in today’s climate could be advantageous for you and your family.

Is it a Good Time to Buy a House for the First Time?

Here are four factors to show that now is a good time to buy a house for the first time:

Mortgage Rates Will Come Down Soon

Unless Canada’s inflation rate dramatically reaccelerates, interest rates will come down soon. The Bank of Canada (BoC) has already said as much, though monetary policymakers are monitoring the real estate market out of precaution. That said, the consensus among economists and market watchers is that the central bank will soon pull the trigger on a quarter-point rate cut and slash rates by a full percentage point by the year’s end.

What does this mean for homebuyers? Mortgage rates will follow suit. Since August 2023, the conventional five-year fixed mortgage lending rate has been above six per cent. If the monetary authorities have successfully vanquished inflation in the Canadian economy and move ahead with loosening monetary policy, the cost of borrowing a mortgage could gradually slide below six per cent. This could potentially save buyers thousands of dollars over the course of the term, particularly if borrowers shop around for the best terms and conditions.

Government Incentives

All three levels of government have put forward incentives to foster more home buying among first-time buyers. While some of these programs might not result in substantial savings for households residing in hot real estate markets like Toronto and Vancouver, they can undoubtedly provide significant savings for people living in Manitoba or Nova Scotia.

Here is a breakdown at the federal level:

Home Buyers’ Plan (HBP): Canadians are eligible to tap into their registered retirement savings plans (RRSPs) to buy a home. Borrowers can withdraw up to $60,000.

Tax-Free First Home Savings Account (FHSA): Borrowers can make tax-deductible contributions of up to $8,000 per year for a lifetime maximum of $40,000.

In addition, Ottawa has implemented other tax credits and rebates to help address housing affordability challenges.

Across the country, provinces have established a treasure trove of grants and incentives to help first-time homebuyers confidently trek the real estate market. In Ontario, for instance, there is the Land Transfer Tax Refunds for First-Time Homebuyers. In British Columbia, there is the First-Time Home Buyers’ Program. Or, in New Brunswick, officials have established the Home Ownership Program.

At the municipal level, there are various initiatives to construct more housing.

Ultimately, all of these programs will help first-timers take the leap into home ownership and potentially get more of the home features that they desire, such as more square footage or their desired location.

Brace for a Soft Landing?

Inflation has impacted millions of Canadians. While the consumer price index (CPI) is still hovering close to three percent – above the central bank’s two-per-cent target rate – disinflation has been prevalent, and the increases have not been as fast and furious. As for the rest of the economy, conditions have been relatively slow. The last time the monthly GDP rate hit one percent was in August 2020.

According to S&P Global, GDP growth in Canada will continue to be sluggish in the coming months, with the real GDP rate coming in at 0.9 percent in 2024. TD Bank forecasts that long-term growth is anticipated to decelerate to around 1.8 percent annually. “This will be driven by solid population and labour force growth, while productivity growth lags behind,” the bank stated in its report.

The good news? Canada might avert a recession, which would also suggest that the employment situation does not deteriorate. Of course, this is good news for first-time homebuyers as they can have the confidence that their labour situation will not worsen, forcing borrowers to eat into their savings until they find other employment opportunities.

While economic conditions can change on a dime, many market observers are confident that Canada could accomplish a soft landing, a situation whereby growth is intact, labour market remains solid, and inflation is eradicated.

Stagnating Price Growth

Housing market conditions have stabilized in Canada. In other words, the real estate industry has not witnessed the violent price swings that occurred a few years ago. For instance, the Canadian Real Estate Association (CREA) reported that the MLS® Home Price Index (HPI) dipped 0.3 percent monthly in March and was up just 0.7 percent year-over-year. While the national average home price is higher than the pre-crisis level – in March, it was nearly $699,000 – the acceleration has slowed.

All About Supply

In the end, supply will define the Canadian real estate market in the coming years. With Canada’s population only growing amid rising immigration levels, demand will undoubtedly be baked into the cake. But will the country respond to these conditions and start building more supply? There is growing optimism that home construction plans by the government and the industry’s response to the pressing need for millions of new homes over the next decade will help bolster the Canadian real estate market. The future is bright, and other homebuyers realize a hopeful future is in the realm of possibility.

Courtesy RE/MAX Canada

The Bank of Canada today reduced its target for the overnight rate to 4¾%, with the Bank Rate at 5% and the deposit rate at 4¾%. The Bank is continuing its policy of balance sheet normalization.

The global economy grew by about 3% in the first quarter of 2024, broadly in line with the Bank’s April Monetary Policy Report (MPR) projection. In the United States, the economy expanded more slowly than was expected, as weakness in exports and inventories weighed on activity. Growth in private domestic demand remained strong but eased. In the euro area, activity picked up in the first quarter of 2024. China’s economy was also stronger in the first quarter, buoyed by exports and industrial production, although domestic demand remained weak. Inflation in most advanced economies continues to ease, although progress towards price stability is bumpy and is proceeding at different speeds across regions. Oil prices have averaged close to the MPR assumptions, and financial conditions are little changed since April.

In Canada, economic growth resumed in the first quarter of 2024 after stalling in the second half of last year. At 1.7%, first-quarter GDP growth was slower than forecast in the MPR. Weaker inventory investment dampened activity. Consumption growth was solid at about 3%, and business investment and housing activity also increased. Labour market data show businesses continue to hire, although employment has been growing at a slower pace than the working-age population. Wage pressures remain but look to be moderating gradually. Overall, recent data suggest the economy is still operating in excess supply.

CPI inflation eased further in April, to 2.7%. The Bank’s preferred measures of core inflation also slowed and three-month measures suggest continued downward momentum. Indicators of the breadth of price increases across components of the CPI have moved down further and are near their historical average. However, shelter price inflation remains high.

With continued evidence that underlying inflation is easing, Governing Council agreed that monetary policy no longer needs to be as restrictive and reduced the policy interest rate by 25 basis points. Recent data has increased our confidence that inflation will continue to move towards the 2% target. Nonetheless, risks to the inflation outlook remain. Governing Council is closely watching the evolution of core inflation and remains particularly focused on the balance between demand and supply in the economy, inflation expectations, wage growth, and corporate pricing behaviour. The Bank remains resolute in its commitment to restoring price stability for Canadians.

Information note

The next scheduled date for announcing the overnight rate target is July 24, 2024. The Bank will publish its next full outlook for the economy and inflation, including risks to the projection, in the MPR at the same time.

Courtesy The Bank Of Canada

MAY 2024 HOUSING MARKET UPDATE

June 3, 2024

In a market that continues to show resilience, May saw a total of 3,092 resale home sales. While this figure is nearly one per cent below last year's record high, it is 34 per cent higher than long-term trends for the month. The pullback in sales was primarily driven by declines in lower-priced detached and semi-detached homes, where there was limited supply choice compared to last year.

"Although new listings have increased, much of this growth is in higher price ranges for each property type," said Ann-Marie Lurie, Chief Economist at CREB®. “Our strong economic situation has supported sales growth in these higher price ranges. However, this month's sales could not offset the declines in the lower price ranges due to a lack of supply choice."

New listings in May reached 4,333 units, almost 19 per cent higher than last year. This increase in new listings compared to sales caused the sales-to-new listings ratio to drop to 71 per cent, supporting a modest year-over-year inventory gain. Despite this, inventory levels remained nearly half what we typically see in May, with most gains driven by homes priced above $700,000.

While inventories did improve this month, conditions continue to favour sellers with one month of supply. Several districts continue to report less than one month of supply, while the City Centre reported the highest supply-to-sales ratio at one and a half months. Seller market conditions drove price growth across all districts in the city. The unadjusted total residential benchmark price in May reached $605,300, nearly one per cent higher than last month and 10 per cent higher than last May. 

Detached

The gain in detached sales for homes priced over $700,000 was not enough to offset pullbacks across the lower price ranges, as year-over-year sales declined by seven per cent. At the same time, new listings rose enough to cause the sales-to-new-listings ratio to drop to 68 per cent, supporting inventory growth. However, inventory levels for homes priced below $600,000 continued to fall, accounting for only 13 per cent of the detached market.

With just over one month of supply, the detached market continues to favour the seller, and prices continue to rise. As of May, the unadjusted benchmark price reached $761,800, over one per cent higher than last month and 13 per cent higher than prices reported last year. Prices improved across all districts, with the most significant year-over-year gains occurring in the most affordable districts. 

Semi-Detached

The year-over-year decline in sales did not offset earlier gains, as year-to-date sales rose by nearly 11 per cent. Like the detached sector, we have also seen improved levels of new listings come onto the market, causing the sales-to-new listings ratio to drop to 72 per cent and driving some gains in inventory levels. 

Nonetheless, the market continues to favour the seller with one month of supply. The persistently tight market conditions continue to drive up prices. The benchmark price reached $678,000 in May, over one per cent higher than last month and 13 per cent higher than last May. 

Row

May reported 540 sales, a gain over last year that has contributed to the 16 per cent year-to-date rise. At the same time, new listings also rose, supporting a gain in inventory levels. Inventory levels have declined for properties below $400,000, but the gains reported for higher-priced row properties were enough to support overall inventory gains. 

With a sales-to-new-listings ratio of 78 per cent and a months of supply below one month, conditions continue to favour the seller, driving further price growth. In May, the benchmark price reached $462,500, nearly two per cent higher than last month and over 19 per cent higher than last year’s levels.

Apartment Condominium

Demand for affordable homes continues to drive growth for apartment condominium-style homes. May sales continued to rise, contributing to the year-to-date record high with a 19 per cent gain. This was partly possible thanks to gains in new listings preventing a further drop in inventory levels. While inventory levels are similar to last year, the gains for products over $300,000 offset the steep declines for lower-priced homes.

With a months of supply of just over one month, conditions still favour the seller, and prices continued to increase compared to last month's and last year’s levels. Year-over-year price gains exceeded 30 per cent in the North East and East districts, with the lowest price growth occurring in the City Centre at 13 per cent.

REGIONAL MARKET FACTS

Airdrie

A boost in new listings compared to sales helped support a gain in inventory this month. However, with only 208 units available, levels are still half what we traditionally see in the market in May. Detached homes accounted for nearly 70 per cent of all the inventory in Airdrie, with half of the detached supply priced below $700,000.

While Airdrie remains a relatively affordable alternative to Calgary for consumers, benchmark prices continue to rise over last month's and last year's levels. Benchmark prices ranged from $289,000 for apartment-style homes to $651,000 for detached properties.

Cochrane

This month's 132 new listings were nearly matched with the 130 sales, causing the sales-to-new-listings ratio to rise to 98 per cent and inventories to decline. 

The persistently tight market conditions continue to drive further price growth. The total residential benchmark price rose by over one per cent compared to last month and 10 per cent over last year. The most significant price growth occurred for apartment-style homes, which reached $304,900. Detached home prices rose to $667,700 in May. 

Okotoks

Inventory levels in Okotoks continued to remain exceptionally low in May. With only 84 units in inventory, levels are 55 per cent lower than what is traditionally available in the market. While new listings improved slightly in May, the 100 new listings were met with 75 sales, keeping the sales-to-new listings ratio elevated at 75 per cent. 

With one month of supply in the town, it is no surprise that we continue to see upward pressure on home prices. In May, the unadjusted residential benchmark price rose by one per cent over last month and is over eight per cent higher than last year’s. Prices ranged from $262,500 for an apartment condominium to $699,600 for a detached home.

Click here to view the full City of Calgary monthly stats package.

Click here to view the full Calgary region monthly stats package.

National Cottage Market Outlook

From a Canada-wide perspective, a flood of listings hasn’t hit the recreational property market this spring, and is unlikely to transpire this year. Despite the affordability challenges and higher interest rates that characterized the 2023 real estate market, Canada’s cottage owners are choosing to hold on to their properties in 2024 rather than selling off – a trend that’s likely influenced by the desirable quality of life alongside the prospect of future returns on recreational property ownership. Looking ahead, RE/MAX brokers and agents in Canada are anticipating the national average cottage price to increase 6.8 percent. Meanwhile, the number of sales is expected to rise in the majority of regions analyzed (61.9 percent), increasing between three percent upwards of 50 percent this year.

Cottage prices have increased in 83 percent of Western Canada’s recreational markets, according to RE/MAX Canada’s 2024 Cottage Trends Report. Year-over-year gains were noted in Whistler (+7.5 percent, from $1,633,855 in Q1 of 2023 to $1,756,473 in  Q1 of 2024); Tofino (+100 percent from $0 in Q1 in 2023 due to no available inventory, to $1,001,116 in Q1 of 2024); Edmonton Lakes (+11.8 percent, from $639,750 in Q1 of 2023 to $715,300 in Q1 of 2024**); Canmore (+8.1 percent, from $962,619 in Q1 of 2023 to $1040,422 in Q1 of 2024); and Sylvan Lake and Central Alberta (+14.9 percent, from $580,357 in Q1 of 2023 to $666,949 in Q1 of 2024). Meanwhile, Ucluelet experienced a decrease in sales price (-11 percent, from $764,000 in Q1 of 2023, to $676,703 in Q1 of 2024). North Okanagan also saw a decline in price (-12 percent, from $835,193 in Q1 of 2023, down to $739,000 in Q1 of 2024).

According to RE/MAX brokers’ outlook for the remainder of the year, Western Canada’s cottage prices could see average prices rise between five and 10 percent, as demand continues to grow. Price is expected to increase by two percent in North Okanagan, five percent in Edmonton Lakes, Sylvan Lake and Central Alberta, 10 percent in Canmore and 10 percent in Ucluelet. On the flip side, Tofino is anticipating a 10-per-cent decrease in sales prices due to regional limitations on short-term rentals this year, which is prompting some recreational property owners to divest themselves of their properties or convert them into primary residences.

Compared to 2023 market conditions, Central Alberta, as well as Sylvan Lake and Canmore continue to favour sellers, while Edmonton Lakes is experiencing a more balanced market. Whistler, British Columbia is also gaining balance, with an eight-per-cent listings-to-sales ratio for single-family homes, compared to 30-per-cent listings-to-sales ratio for affordable condominiums. Tofino and Ucluelet on the other hand, have shifted from a balanced market to a buyer’s market.

Similar to 2023, retirees are driving recreational property sales (notably in Canmore, Edmonton Lakes and Central Alberta) followed by families (in Canmore, Central Alberta, Tofino and Ucluelet), couples (in Edmonton Lakes, Central Alberta, Tofino and Ucluelet) and investment buyers (in Canmore, Central Alberta, Tofino and Ucluelet). Favoured amenities among buyers in these regions include access to recreational activities (most notably in Canmore, Edmonton Lakes, Central Alberta, Whistler, Tofino and Ucluelet), followed by functional WiFi access (in Edmonton Lakes, Central Alberta, Whistler, Tofino and Ucluelet), proximity to water (in Edmonton Lakes and Central Alberta), close-knit communities (in Tofino and Ucluelet), and swimming pools (in Canmore and Whistler).

Four out of the 7 regions analyzed in Western Canada have recorded a sales increase in the first quarter of the year, including Whistler (+2.6 per cent, from 114 in Q1 of 2023 to 117 in Q1 of 2024); Tofino (+300 percent, from zero sales in Q1 of 2023 to three in Q1 of 2024); Edmonton Lakes (+27.8 percent, from 18 in Q1 of 2023 to 23 in Q1 of 2024**); and Canmore (+19.8 per cent, from 101 in Q1 of 2023 to 121 in Q1 of 2024). Meanwhile, sales in Ucluelet have held steady year-over-year (six in Q1 of 2023, and six in Q1 of 2024), while sales declined in North Okanagan (down seven percent, from 15 sales in Q1 2023 to 14 sales in Q1 2024), as well as in Sylvan Lake/Central Alberta as a direct result of inventory shortages (down eight percent, from 40 in Q1 of 2023 to 37 in Q1 of 2024).

Much in line with the Leger survey data, brokers in Western Canada, with the exception of Tofino, also reported that recreational property owners continue to hold onto their properties and aren’t offloading as a result of affordability. Sales decisions are more likely being driven by downsizing and aging out of the property.

**Edmonton Lakes sale price figures and number of sales figures are inclusive of data collected from residential and lakefront property transactions.

Market-By-Market Overview

WHISTLER, BC

Whistler’s residential property market is currently balanced across all property types, with activity being driven by a mix of families, couples (young, middle-aged), retirees, investment buyers, foreign buyers and out-of-province buyers.

The 2024 average residential sale price across all property types increased by 7.5 percent year-over-year (from $1,633,855 in Q1 2023 to $1,756,473 in Q1 2024). Average number of sales increased by 2.6 percent year-over-year (from 114 in 2023 Q1 to 117 in 2024 Q1).

For single-family homes (chalets), Whistler is currently deep in buyer’s market territory with an eight-per-cent listing-to-sales ratio, while in the lower price points (condominiums), Whistler is experiencing a seller’s market, with a 30-per-cent listings-to-sales ratio.

Buying & Selling in Whistler

Buyer demand is strong when it comes to residential properties. Pricing and number of sales have ticked up year-over-year; however, current interest rates are capping purchasing power, which is in turn causing different segments of the residential market to react differently.

Most buyers in Whistler are hailing from the Greater Vancouver Area and local to Whistler, with about six percent coming from elsewhere in Canada and eight percent coming from the US. The features and amenities most in demand among residential property buyers in Whistler are:

• Access to recreational activities (i.e. skiing, water sports)

• Good Wi-Fi access

• Swimming pool

Regulations are having an impact in the region. For example, new mandates from the provincial and federal governments concerning the number of dwellings on properties zoned for single-family homes are expected to have an influence on the value of vacant lots and single-family home properties in certain price points. Exactly how this will play out with the municipality specifically, remains to be seen. Changes are anticipated to take effect starting after June 30.

Advice for Buyers

• It’s advisable for buyers to determine with their real estate agent which features are the most important to them. This will help stay organized and ready to go when their desired property hits the market.

• For sellers, pricing their property correctly is paramount to achieving a sale in the Whistler market. A professional broker can walk them through the proper pricing methodology and a strategy which best suits their needs.

• One persisting trend from the pandemic seems to be the relatively low number of properties on the market at any given time. A strong desire to live, work and play in the beautiful area of Whistler, combined with a shortage of properties on the market, has kept the number of listings low.

TOFINO & UCLUELET, BC

Tofino & Ucluelet are experiencing a buyer’s market, due to new capital gains increases from the federal government and the short-term rental rules imposed by the BC Government. Tofino, although exempt as a resort municipality, has chosen to opt into the provincial legislation. Ucluelet, on the other hand, has continued to opt out.

Families, couples (including young and middle-aged) and investment buyers are driving the residential and recreational property sales. This trend is expected to continue.

In Tofino, there were no sales or listings inventory recorded in Q1 2023. But, in Q1 2024, the average recreational sale price was $1,001,116. The number of sales across all recreational properties in the region increased by 300 percent year-over-year (from 0 in Q1 2023 to 3 in Q1 2024).

In Ucluelet, the average cottage prices across all recreational properties decreased by eight percent year-over-year (from $764,000 in Q1 2023 to $676,703 in Q1 2024). The number of sales held steady year-over-year (6 in Q1 2023 and 6 in Q1 2024).

Average sale prices and transactions are expected to decline 10 percent in Tofino through the remainder in 2024. Meanwhile, Ucluelet will likely see both sales and prices rise by 10 percent.

Buying & Selling in Tofino & Ucluelet

Despite inventory increasing in the region, short-term rental rules are creating challenging conditions for investors and buyers seeking additional income through short-term stay rentals. This is expected to be further pressured by the federal’s government’s capital gain tax increase which will go into effect on June 25, with many owners looking to sell and close before that date. Some property owners have chosen to list their property, prompted by the federal government’s announcement of a capital gains tax increase.

Buyers are coming from the lower mainland and Vancouver Island. This has not changed since last year. The features and amenities most in demand among residential property buyers in 2024 are:

• Good Wi-Fi access

• Access to recreational activities

• Close-knit community

• Waterfront properties

Regulations such as short-term rentals are impacting the local residential markets. Tofino has opted into the new provincial legislation restricting short-term rentals. Tofino property owners with affected properties are likely to see a significant drop in value as income will be about 1/3 or less of what they were earning as short-term rentals. Ucluelet has managed to deal with short-term rentals issues by zoning and has chosen to opt out of the provinces short-term rental rules. Ucluelet is likely to see more buyers who would have otherwise considered Tofino.

Advice for Buyers

• Sellers need to keep in mind that with higher interest rates, the market is not what it was in 2020 and 2021. There are fewer sales and less competition.

• Buyers need to be mindful of the shifting landscape and to ensure they do a thorough job understanding what short-term rental restrictions apply.

EDMONTON LAKES, AB

Edmonton Lakes’ property market is currently balanced, with the spring season generally affording enough inventory for six months of sales. Couples, including young and middle-aged couples, and retirees, are driving property sales.

The 2024 average residential sale price across all residential property types, not including lakefronts (Zones 75,71 & 93) increased by 22.7 percent year-over-year, from $388,772 in Q1 2023 to $477,104 in Q1 2024. Meanwhile, the average price of lakefront properties (Zones 75,71 & 93) increased by 10.5 percent, from $639,750 in Q1 2023 to $715,300 in Q1 2024.

The number of sales increased by 27.8 percent year-over-year (from 18 in 2023 Q1 – of which 4 were lakefronts, to 23 in 2024 Q1 – of which 10 were lakefronts).

Prices are anticipated to increase by five percent by the end of the year – depending on the inventory on the market. Sales will likely remain balanced year-over-year, with a possible slight increase of up to three percent by end of 2024.

Buying & Selling in Edmonton Lakes

Edmonton Lakes is starting to see newer homes coming on the market that generate a higher value, which is contributing to the increase of the sales price values. Inventory is generally fairly stable with the major market season beginning in April of every year until around the end of October.

Most buyers are coming from both out-of-province (BC and Ontario), and locally, from Edmonton and Edmonton’s surrounding area, and Northern Alberta. This has not changed since last year.

The features and amenities most in demand among buyers in 2024 include:

• Waterfront properties

• Access to recreational activities (i.e. skiing, water sports)

• Good Wi-Fi access

Since the onset of COVID-19, buyers continue to want out of city centres while taking advantage of lower interest rates. They can enjoy the quality of life that the ‘lake life’ offers. It also helps that the Edmonton Lakes region is only an hour out of the city of Edmonton, making it easy to commute.

Advice for Buyers

Hire a local expert in the desired local target area. Local expertise helps ensure buyers get what they are looking for.

CANMORE & BANFF, AB

Canmore/Banff is experiencing a seller’s market, as it continues to struggle with lack of inventory and low buyer demand. Families, couples (including young and middle-aged couples), retirees and investment buyers are all driving residential property sales in the region. Albertans are also driving property sales in the region. This trend is expected to continue.

The 2024 average residential sale price across all residential property types increased by 8.1 per cent year-over-year, from $962,619 in Q1 2023 to $1,040,422 in Q1 2024. Sales across all residential property types increased by eight per cent year-over-year, from 101 in 2023 Q1 to 121 in 2024 Q1.

Average cottage prices in the region are likely to increase by 10 percent by the end of 2024, while sales is likely to increase by five percent.

Buying & Selling in Canmore & Banff

There continues to be strong buyer demand, mainly from Alberta and Ontario. In addition, there is international demand, though they can’t currently purchase. Lack of supply is putting upward pressure on pricing. Much like 2023, strong demand for properties which are eligible for nightly and weekly rental is also trending in the region.

Out-of-province buyers are coming from Ontario, and more-locally from Calgary and Edmonton. This has not changed since last year. The features and amenities most in demand among residential property buyers in 2024 are:

• Mountain views

• Swimming pool

• Access to recreational activities (i.e. skiing and hiking)

• Good Wi-Fi access

Advice for Buyers

• Be prepared to act quickly.

• Be prepared to compete for properties.

• Although this is a seller’s market, there is still a need to price correctly to successfully sell.

SYLVAN LAKE, AB

Central Alberta Lakes’ residential property market is currently a seller’s market, driven by strong demand and short supply. The Alberta economy is very strong, with population increases due to inter-provincial migration from Ontario and B.C. New construction isn’t keeping up with demand driving prices higher. Families, retirees and investment buyers (for Airbnb) are driving property sales. This trend is expected to continue, so long as Central Alberta’s economy stays strong.

The 2024 average recreational sale price across all recreational properties increased by 14.9 percent year-over-year, from $580,357 in Q1 2023 to $666,949 in Q1 2024. Sales decreased by 7.5 percent year-over-year, from 40 in Q1 2023 to 37 in Q1 2024.

Looking ahead, average prices are anticipated to increase by five percent by the end of 2024, while total sales will likely decline by by three percent.

Buying & Selling in Sylvan Lake

There are fewer recreational properties on the market with continued strong demand, although high interest rates are probably slowing sales somewhat. Average 91 days on market in the first quarter of 2024, compared to 78 days in the first quarter of 2023.

Most buyers are coming from both out-of-province (Ontario and B.C.), and locally, from Calgary and Edmonton. This has not changed since last year. The features and amenities most in demand among buyers in 2024 include:

• Large properties with more outdoor/green space

• Waterfront properties

• Access to recreational activities (i.e. skiing, water sports)

• Good Wi-Fi access

Since COVID-19, there is a strong Central Albertan economy with lots of money around which allows families to make discretionary spending decisions. Supply of lake property in Alberta is limited, driving prices higher when the economy is strong.

Advice for Buyers

There are still properties available at relatively affordable prices at the less popular lakes, including: Pine Lake, Buffalo Lake and Gull Lake. Although, they are all suffering from lower water levels due to the drought in Alberta.

Courtesy RE/MAX LLC

APRIL 2024 HOUSING MARKET UPDATE

May 1, 2024

Price growth persists in Calgary as seller’s market prevails

Sales in April rose by seven per cent compared to last year, to 2,881 units. While the pace of growth did ease compared to earlier in the year, sales remain 37 per cent higher than long-term trends for the month. Much of the growth in sales has occurred for relatively more affordable, higher-density products. 

At the same time, there were 3,491 new listings in April, an 11 per cent gain over last year but only three per cent higher than long-term trends. The rise in new listings compared to sales prevented any further deterioration of the inventory situation. However, with 2,711 units in inventory, levels are 16 per cent below last year and half of what is traditionally seen in April.

“While supply levels are still declining, much of the decline has been driven by lower-priced homes," said Ann-Marie Lurie, Chief Economist at CREB®. “Homes priced below $500,000 have reported a 29 per cent decline. Meanwhile, we are seeing supply growth in homes priced above $700,000. Persistently high-interest rates are driving demand toward more affordable products in the market and, at the same time, driving listing growth for higher-priced properties.”

With a sales-to-new-listings ratio of 83 per cent and a months of supply of less than one month, conditions continue to favour the seller, driving further price gains in the market. In April, the unadjusted total residential benchmark price reached $603,700, a one per cent gain over last month and nearly 10 per cent higher than last year's levels. Price gains occurred across all property types and districts of the city. The strongest price growth occurred in the more affordable districts of the city. 

Detached

Detached home sales rose by one per cent in April compared to last year. Sales gains in the higher price ranges offset the steep decline for homes priced below $600,000, which is related to the lack of listings in the lower price ranges. While detached new listings did report a year-over-year gain of 10 per cent, detached homes priced below $600,000 saw new listings decline by 34 per cent.

Adjustments in sales and inventory levels caused the months of supply to fall further this month. The less than one-month supply reflects a market favouring the seller, driving further price growth. In April, the unadjusted benchmark price reached $749,000, over one per cent higher than last month and 13 per cent higher than April 2023 levels. Year-over-year gains were the highest in the city's most affordable districts.

Semi-Detached

Sales activity continued to rise in April, contributing to the nearly 18 per cent year-to-date growth in sales. The growth in sales was partly due to gains in new listings. However, the growth in new listings did little to change the low inventory situation, as the months of supply remained below one month for the second month in a row.

The persistently tight market conditions have caused further price gains. In April, the unadjusted benchmark price reached $668,400, nearly two per cent higher than last month and 13 per cent higher than levels reported last year. Year-over-year price gains ranged from a high of 23 per cent in the East district to a low of 10 per cent in the City Centre.

Row

Row home sales continued to improve in April, contributing to the 19 per cent year-to-date gain. At the same time, new listings have improved by 16 per cent so far this year. The gains in new listings did little to change the low inventory situation due to sales activity. This has kept the sales-to-new-listings ratio high at 93 per cent and the months of inventory below one month for the fourth consecutive month.

The persistently tight conditions, especially in the lower price ranges, are driving further price growth for row homes. In April, the unadjusted benchmark price reached $458,100, two per cent higher than last month and 20 per cent higher than levels reported last year. Both monthly and year-over-year gains were the highest in the most affordable districts of the North East and East, where resale row homes are still priced below $400,000.

Apartment Condominium

Sales in April reached 822 units, contributing to year-to-date sales of 2,761 units, a 24 per cent gain. Apartment condominium sales have risen more than any other property type and now represent nearly 30 per cent of all resale activity. This, in part, has been possible due to the rise in new listings. April reported 1,050 new listings, helping support a monthly gain in inventory levels in line with seasonal expectations. However, inventory levels remain nearly 13 per cent lower than last year’s and are 35 per cent below long-term trends.

Like other property types, year-over-year supply declines are driven by the lower-priced segments of the market, which for apartment condominiums is units priced below $300,000. Overall, persistent sellers’ market conditions in the lower price ranges are driving further price growth. In April, the unadjusted benchmark price reached $346,200 a month, a gain of over two per cent and nearly 18 per cent higher than last April. Year-over-year price growth ranged from over 30 per cent in the North East and East districts to a low of 13 per cent in the City Centre.

REGIONAL MARKET FACTS

Airdrie

Supply continues to be a challenge in the Airdrie market. April reported 219 new listings and 202 sales, keeping the sales-to-new listings ratio elevated at 92 per cent. This prevented any significant change in the lower inventory environment, and the months of supply remained below one month.

Persistently tight market conditions have driven further price gains. In April, the unadjusted total residential benchmark price rose by nearly two per cent compared to last month and over 10 per cent compared to last year, reaching $549,100. Detached homes account for the majority of sales, and prices reached $649,900 in April, nearly 12 per cent higher than last year.

Cochrane

Sales in April eased compared to last year. However, this was not enough to offset the gains that occurred earlier in the year, as year-to-date sales improved by seven per cent. Some of the monthly pullback in April can be related to a drop in the number of new home sales occurring in the resale market.

Meanwhile, new listings improved relative to sales, supporting a modest gain in inventory levels. This also helped push the months of supply up to nearly two months. Despite the shift, conditions remain relatively tight, causing further price gains. Prices rose across all property types. In April, the unadjusted total residential benchmark price reached $561,000, one per cent higher than last month and nearly 11 per cent higher than April 2023.

Okotoks

Both sales and new listings improved in April compared to last year, but with 89 new listings and 65 sales, inventory levels rose compared to last month and last year. However, inventory levels in the town remain 60 per cent below what is typically on the market at this time of year.

With one month of supply, the market continues to favour the seller and is driving further price growth. In April, the unadjusted total residential benchmark price reached $617,200, one per cent higher than last month and nearly eight per cent higher than last year. Prices improved across all property types, with the highest gains occurring for semi-detached and row homes.

Click here to view the full City of Calgary monthly stats package.

Click here to view the full Calgary region monthly stats package.

The Canadian housing market showed little change in March 2024, with home sales and prices remaining mostly flat. Sales activity recorded through Canadian MLS systems edged up by 0.5 percent month-over-month but remained below the average of the last 10 years. 

The national composite MLS Home Price Index (HPI) also remained mostly unchanged, dipping by 0.3 percent month-over-month. The report suggests that while there are expectations of a market pick-up this year, the current situation could be influenced by high interest rates and the anticipation of rate cuts.

Canadian consumers are tapped out but buyer’s market potentially on horizon

We’d say it’s more likely this flat market behaviour indicates that the Canadian consumer is tapped out, and with housing at record unaffordability, it’s unlikely we’ll see much growth until affordability returns to the market.

Affordability is a function of price, interest rates and income. According to Bloomberg, to reach pre-COVID affordability in Canada, prices would need to come down 33 percent, incomes would need to rise 55 percent or interest rates would need to fall 350 basis points. 

It’s likely that some combination of these three factors will eventually create a recovery in the Canadian real estate market. 

The data suggests buyers might respond positively to the increase in new properties for sale, which would reduce some excess demand and potentially create a buyer’s market, allowing for negative price discovery to take place. The full impact will be clearer with the release of April’s data.

Transactions

The unadjusted transaction count for March 2023 exhibited a 1.7 percent increase compared to the previous month. This growth was relatively modest when juxtaposed with the preceding two months’ performances. Apparently, the Easter weekend’s sluggish market conditions can be blamed for this subdued growth.

However, when looking at the inability of monthly home sales to return to their 10-year average, it tells us that unaffordability and economic factors are clearly preventing Canadians from buying homes the way they have in the past:

Price

Price activity seemed comparably underwhelming, with prices moving sideways (slightly downward) during the spring market of February and March — two months they almost always move up:

The biggest increases in price were observed in the following locations.

1. Greater Moncton: +5 percent

2. Estrie, Quebec: +3.5 percent

3. Prince Edward Island: +2.7 percent

4. Sault Ste. Marie, Ontario: +2 percent

5. Chilliwack, British Columbia: +1.9 percent

The biggest decreases in price were observed in these locations.

1. Simcoe & District, Ont.: -2.3 percent

2. Mauricie, Que.: -3 percent

3. Halifax: -1.7 percent 

4. B.C.’s Interior region: -1.6 percent

5. Owen Sound, Ont.: -1.2 percent

CREA’s 2024 forecast

The Canadian Real Estate Association (CREA) released its quarterly forecast, which indicates a return to the 10-year average sales volume growth trajectory by 2025.

CREA expects interest rates to remain a key factor influencing Canadian housing markets through 2024 and 2025. The market has been noticeably quiet since the Bank of Canada’s rate hikes in 2023, with prices in many markets still well below their historic peaks seen in 2021 and 2022.

Source: CREA

Expectations suggest the first rate cut in 2024 may occur in the second half of the year, with financial markets predicting around 50 basis points of cuts by the end of 2024. Most economists seem to believe that Canada won’t cut until the United States Federal Reserve cuts, which we may not see this year if it doesn’t happen at the next Federal Open Market Committee meeting. 

CREA’s statistics show a bounce in new supply, sales and listings, suggesting the market may be gearing up for a recovery. Around 492,083 residential properties are projected to trade in 2024, a 10.5 percent increase from 2023. The national average home price is forecast to increase by 4.9 percent to $710,468 in 2024.

In 2025, national home sales are expected to climb by 7.8 percent to 530,494 units, while the national average home price is projected to rise by 7 percent to $760,120.

Increases in volume

CREA’s 2024 forecast shows the biggest increase in number of homes sold to take place in:

• Alberta, by 13.6 percent

• Nova Scotia, by 12.7 percent

• Ontario, by 12.6 percent 

• Quebec, by 11 percent

Source: CREA

Increases in price

CREA’s 2024 forecast expects the biggest increase in home prices to be seen in:

• Alberta, by 7 percent to $479,765

• British Columbia, by 6.9 percent to $1,037,382

• Nova Scotia, by 6.7 percent to $451,114

• Quebec, by 5.9 percent to $515,877

Source: CREA

Courtesy REM Magazine, CREA

A public hearing on a proposed bylaw that could change the urban landscape of Calgary starts on Monday when citizens head to council chambers to voice their opinions about a possible citywide zoning change.

The rezoning proposal is a key part of the city's housing strategy, something the city says is an important measure to address housing supply and affordability.

If passed, the bylaw would allow for different housing types, such as six-plexes and townhomes, to be built in neighbourhoods that currently only allow single-family homes.

It's been a hotly debated topic that included an attempt at a plebiscite, separate community meetings with city councillors, a highly-criticized citizen engagement plan and a letter opposing the proposal signed by more than 40 Calgary community association presidents.

In an interview on CBC Calgary's This is Calgary podcast, host Anis Heydari spoke with Chris Welner, the Glendale community association president, about why he thinks rezoning is not the right path.

He was one of those who signed the letter.

City council is about to decide if it wants to make it simpler to knock down a bungalow and build a row house. This could help ease the affordability crunch, and could lead to neighbourhoods that don't look like they were intended to. With emotion on all sides, we hear from a community opposed, and why the city says it's time to get cozy with this blanket.

"I think blanket zoning is really a blunt sledgehammer," said Welner.

"We 100 percent support density development, but it's got to be done properly. It can't just be 'open up the doors to a developer who wants to build on anywhere they want, under any circumstances.'"

According to the City of Calgary, rezoning happens when a property owner wants to develop something other than what's currently allowed under existing zoning. 

"Council makes the final decision on whether to approve or refuse a rezoning application after a public hearing," the city said on its website.

If the rezoning is approved by council, the applicant can submit a development permit application. Depending on the location of the property, development and building permits might still be required — and building permits are always required for new homes.

Speaking on This is Calgary, Josh White, Calgary's director of city and regional planning, said the citywide rezoning proposal is a necessary step toward solving the ongoing housing problems the city faces.

As it stands, White said, around two-thirds of the city's land base is only zoned for single-detached homes and no change can happen. If you want to replace a single-detached home, you'd only be able to do build another house of the same type.

"We've seen rapid rise in rent and price across the city," White said.

"What that [rezoning] does is allow more diversity of housing, so, different varieties of housing to boost our housing supply and provide housing that's more within the reach of more Calgarians."

The proposed citywide rezoning is one of a number of strategies that the city is pursuing. 

While the proposal may be a solution for one problem, Welner worries that in solving this issue, others will come up.

"Calgary is a great city to live in, it's truly a great place. Are there issues, are there problems, absolutely," he said.

"But blanket zoning is going to open up an amazing wealth transfer to developers who have the wherewithal to come in, buy up the house that's probably a little bit run down that's next to you and put up anything."

The citywide rezoning public hearing starts Monday with a decision on the bylaw to come in the following weeks.

Courtesy CBC News

A public hearing on a proposed bylaw that could change the urban landscape of Calgary starts on Monday when citizens head to council chambers to voice their opinions about a possible citywide zoning change.

The rezoning proposal is a key part of the city's housing strategy, something the city says is an important measure to address housing supply and affordability.

If passed, the bylaw would allow for different housing types, such as six-plexes and townhomes, to be built in neighbourhoods that currently only allow single-family homes.

It's been a hotly debated topic that included an attempt at a plebiscite, separate community meetings with city councillors, a highly-criticized citizen engagement plan and a letter opposing the proposal signed by more than 40 Calgary community association presidents.

In an interview on CBC Calgary's This is Calgary podcast, host Anis Heydari spoke with Chris Welner, the Glendale community association president, about why he thinks rezoning is not the right path.

He was one of those who signed the letter.

LISTEN | Glendale Community Association President Chris Welner says "a more surgical approach" would be a better approach to tackle Calgary's housing crisis:

 

This is Calgary19:50We need to talk about blanket zoning, Calgary

City council is about to decide if it wants to make it simpler to knock down a bungalow and build a row house. This could help ease the affordability crunch, and could lead to neighbourhoods that don't look like they were intended to. With emotion on all sides, we hear from a community opposed, and why the city says it's time to get cozy with this blanket.

"I think blanket zoning is really a blunt sledgehammer," said Welner.

"We 100 per cent support density development, but it's got to be done properly. It can't just be 'open up the doors to a developer who wants to build on anywhere they want, under any circumstances.'"

According to the City of Calgary, rezoning happens when a property owner wants to develop something other than what's currently allowed under existing zoning. 

"Council makes the final decision on whether to approve or refuse a rezoning application after a public hearing," the city said on its website.

If the rezoning is approved by council, the applicant can submit a development permit application. Depending on the location of the property, development and building permits might still be required — and building permits are always required for new homes.

A new multi-family housing development in Inglewood features a number of below-grade suites. (Bryan Labby/CBC)

Speaking on This is Calgary, Josh White, Calgary's director of city and regional planning, said the citywide rezoning proposal is a necessary step toward solving the ongoing housing problems the city faces.

As it stands, White said, around two-thirds of the city's land base is only zoned for single-detached homes and no change can happen. If you want to replace a single-detached home, you'd only be able to do build another house of the same type.

"We've seen rapid rise in rent and price across the city," White said.

"What that [rezoning] does is allow more diversity of housing, so, different varieties of housing to boost our housing supply and provide housing that's more within the reach of more Calgarians."

The proposed citywide rezoning is one of a number of strategies that the city is pursuing. 

While the proposal may be a solution for one problem, Welner worries that in solving this issue, others will come up.

"Calgary is a great city to live in, it's truly a great place. Are there issues, are there problems, absolutely," he said.

"But blanket zoning is going to open up an amazing wealth transfer to developers who have the wherewithal to come in, buy up the house that's probably a little bit run down that's next to you and put up anything."

The citywide rezoning public hearing starts Monday with a decision on the bylaw to come the following weeks.

The Bank of Canada today held its target for the overnight rate at 5%, with the Bank Rate at 5¼% and the deposit rate at 5%. The Bank is continuing its policy of quantitative tightening.

The Bank expects the global economy to continue growing at a rate of about 3%, with inflation in most advanced economies easing gradually. The US economy has again proven stronger than anticipated, buoyed by resilient consumption and robust business and government spending. US GDP growth is expected to slow in the second half of this year, but remain stronger than forecast in January. The euro area is projected to gradually recover from current weak growth. Global oil prices have moved up, averaging about $5 higher than assumed in the January Monetary Policy Report (MPR). Since January, bond yields have increased but, with narrower corporate credit spreads and sharply higher equity markets, overall financial conditions have eased.

The Bank has revised up its forecast for global GDP growth to 2¾% in 2024 and about 3% in 2025 and 2026. Inflation continues to slow across most advanced economies, although progress will likely be bumpy. Inflation rates are projected to reach central bank targets in 2025.

In Canada, economic growth stalled in the second half of last year and the economy moved into excess supply. A broad range of indicators suggest that labour market conditions continue to ease. Employment has been growing more slowly than the working-age population and the unemployment rate has risen gradually, reaching 6.1% in March. There are some recent signs that wage pressures are moderating.

Economic growth is forecast to pick up in 2024. This largely reflects both strong population growth and a recovery in spending by households. Residential investment is strengthening, responding to continued robust demand for housing. The contribution to growth from spending by governments has also increased. Business investment is projected to recover gradually after considerable weakness in the second half of last year. The Bank expects exports to continue to grow solidly through 2024.

Overall, the Bank forecasts GDP growth of 1.5% in 2024, 2.2% in 2025, and 1.9% in 2026. The strengthening economy will gradually absorb excess supply through 2025 and into 2026.

CPI inflation slowed to 2.8% in February, with easing in price pressures becoming more broad-based across goods and services. However, shelter price inflation is still very elevated, driven by growth in rent and mortgage interest costs. Core measures of inflation, which had been running around 3½%, slowed to just over 3% in February, and 3-month annualized rates are suggesting downward momentum. The Bank expects CPI inflation to be close to 3% during the first half of this year, move below 2½% in the second half, and reach the 2% inflation target in 2025.

Based on the outlook, Governing Council decided to hold the policy rate at 5% and to continue to normalize the Bank’s balance sheet. While inflation is still too high and risks remain, CPI and core inflation have eased further in recent months. The Council will be looking for evidence that this downward momentum is sustained. Governing Council is particularly watching the evolution of core inflation, and continues to focus on the balance between demand and supply in the economy, inflation expectations, wage growth, and corporate pricing behaviour. The Bank remains resolute in its commitment to restoring price stability for Canadians.

Information note

The next scheduled date for announcing the overnight rate target is June 5, 2024. The Bank will publish its next full outlook for the economy and inflation, including risks to the projection, in the MPR on July 24, 2024.

Courtesy Bank of Canada