Calgary Real Estate Market Update - December 2023

January 2, 2024

Strong migration and low supply drive Calgary housing prices in 2023

In 2023, the real estate market experienced a relative ease in sales compared to the previous year’s peak, recording 27,416 sales. Despite this decrease, sales remained considerably higher than pre-pandemic levels. Notably, there was a discernible shift towards more affordable apartment-style condominiums as housing demand persisted, driven by strong migration levels.

Higher lending rates impacted housing demand, but the market maintained strength, particularly for affordable options. Throughout the year, low supply levels compared to demand contributed to unexpected price growth, with inventory persistently below long-term trends, averaging a 44 percent decline over the 10-year average.

The months of supply stayed below two months for homes priced below $1,000,000, further emphasizing the tight conditions in the market. The resulting record high average annual benchmark price growth slowed from 12 percent in 2022 to almost six percent in 2023, though still robust compared to other markets.

Detached Homes:
The detached market experienced a nearly 20 percent decline in sales, with limited choices in lower price ranges leading to a shift towards alternative housing styles. Despite some gains in higher-priced new listings, inventories remained near record lows, contributing to nearly eight percent benchmark price growth in 2023, with the most significant gains in the city’s most affordable districts.

Semi-Detached Homes:
Semi-detached homes saw a 10 percent decline in sales, primarily in lower-priced properties due to limited supply choices. Tight market conditions resulted in a seven percent annual benchmark price growth, slower than 2022 but still robust, varying from six percent in the city center to over 16 percent in the east district.

Row Houses:
Limited supply choices in lower price ranges contributed to an 11 percent decline in sales for row houses. Favorable conditions for sellers resulted in over 13 percent annual benchmark price growth, ranging from 11 percent in the city center to over 20 percent in the North East and East districts.

Apartment Condominiums:
Apartment-style properties reported a sales gain, reaching a record high of 7,884. Conditions favored sellers, driving over 13 percent annual benchmark price growth, surpassing 2014 levels. By December, prices reached a new record high of $321,400.

Regional Market Highlights:

Airdrie:
Sales declined by 24 percent, primarily in detached homes, with low inventory levels and limited new listings. Despite this, conditions favored sellers, resulting in a nearly five percent annual benchmark price growth.

Cochrane:
Both sales and new listings fell, but recent improvements supported some inventory gains. Prices continued to rise, with a four percent increase in detached benchmark prices over 2022.

Okotoks:
Supply challenges impacted sales and prices, with inventories near record lows. Despite some improvements in new listings, prices rose by over six percent annually.

In summary, the real estate market in 2023 showcased resilience, with varying trends across property types and regions, emphasizing the impact of supply and demand dynamics on pricing and market conditions.