September 2023 Monthly Market Update

The August stats are in, and for the 4th consecutive month, Calgary has set a monthly sales record. The sales numbers in August were higher than in March and April…which are 2 of the busier spring months.  So, how is this low inventory / high demand environment affecting home values? Are we seeing the same market strength across all property types, and what can we expect to see this fall? 

If you enjoy reading, please continue with my blog below, but if you would prefer to watch the video instead, you can click on the YouTube link below:

Let’s start by looking at those August record sales numbers a bit more closely.

Here is the Total Sales graph from the Calgary Real Estate Board. August finished the month with 2729 sales. This is the first time that August has even crested the 2,500 sales mark, and as you can see,  it is quite a bit stronger than any of the previous August’s going back to 2009. 

Last month, I talked about the amount of people moving to Alberta, which is a significant reason WHY we are seeing such high sales numbers. In Q1, there were approximately 51,000 people who relocated to the province, and while I haven’t come across any updated numbers for Q2, it's safe to say those numbers are still high. 

If we look at new housing, Alberta recorded 3290 new home starts in July 2023, a decrease of 8% from July 2022, but up from the 2368 in June.

Switching to supply, the total inventory graph goes back to 2009. August finished the month with just over 3200 homes on the market, a record low for the month and well below the 6,000 homes that are usually available. The 3200 homes are also 230 less than what it was at the start of the month, and 1,500 fewer or 32% less than August last year. 

While new listings did improve compared to the levels seen in 2022, strong sales have caused inventory levels to hit record lows, resulting in conditions continuing to favour the seller, driving further price gains. 

The benchmark price in August grew to $570,700, which is 8% higher than the $528,000 it was in August of 2022. This is the 8th consecutive month of price gains, and you can see in this graph how much prices have grown since January. 

A look around the city, shown in this graph, highlights the price growth by quadrant. The highest year-over-year price gains occurred in the most affordable regions of the city's North East and East districts.

Prices have also increased across all property types, 

The detached segment grew to $696,700 in August, an increase of 10% year over year and $72,000 since January. 

The semi-detached segment only had 197 sales in August, but those sales resulted in a benchmark price of $623,200, a 10% increase year over year and an increase of $61,000 since January. 

At a benchmark price of $413,200, the row or townhouse segment reported the most significant year-over-year increase of 16%, also $57,000 higher than in January.

The Apartment segment, which had the most sales after detached homes, had a benchmark price of $309,100, a year-over-year price gain of 14% and an increase since January of $36,000.

So, to recap, the summer months finished with sales higher than 2 of our strongest spring months, inventory remains at record lows, and prices have increased for 8 consecutive months. 

Can we expect to see the same conditions as we move into fall?

Typically, in the fall, we see sales and inventory decline each month through to December before both start to increase in February as we approach spring. This year, with sales gaining momentum through July and August and inventory already at record lows, I don’t see the conditions changing for the remainder of 2023. I like to watch this daily, so if I start to see the trends shift, I will be sure to record another video to update you, which is another reason to subscribe to my channel. I know I am not above these shameless plugs.

So, if I am looking to buy or sell in 2023, how can I navigate this?

For those who are Selling…, last month, I talked about not over-pricing your home and how, by doing this, you may get less for your home. This month, I advise that if you plan on selling, make other plans. What I mean by this is when a home first goes on the market, there is usually a flurry of showing requests, and the first few days can be pretty busy with people touring your home. 

If your home goes on the market just before the weekend, it is a good idea to plan to stay with a friend or relative if possible, and if that isn’t possible, plan out activities that you can do for an hour or up to an entire afternoon or evening, to help pass the time. If your home goes on the market mid-week, your late afternoon and evenings can be pretty busy, so you may want to work late or spend the evening with a friend. 

In most cases, you will have advance notice when a showing request is booked, but to prevent frustration, plan a few activities so that being out of the home for a few hours isn’t too inconvenient. 

For those planning to buy: Last month, I talked about engaging a real estate professional early in the process to have someone in your corner, working for you and helping you set up a plan. 

This month, my advice is to have your ducks in a row! In addition to talking to your mortgage advisor or financial institution in advance for a pre-approval, ask them how long it takes to get their approvals done. You can also speak to a home inspector to find out how far in advance they are booking. And if you are buying a condo and having the documents professionally reviewed…which I recommend; by the way, you can ask them how much time they need to do a proper review. 

This will help save you time during the condition window by knowing who you will be using for these services in advance; it will also hopefully help you put a tighter condition window in your offer, which could help you win when competing with others if all the other aspects of the offer are similar. Having your ducks in a row in this busy market will help reduce stress and help you be better prepared when you find that home you want to put an offer on.

If you would like to have a more personalized conversation about your specific situation, please call or text me at 587-998-0731 or email me at sglover@redlinerealestate.ca

Enjoy your September!