Calgary Real Estate Market Update: Uncovering the Truth Behind the 17% Home Sales Drop in 2024
October 4, 2024

Is Calgary's real estate market in trouble? Discover the truth behind the recent 17% sales drop and what it means for buyers and sellers in this analysis.
Calgary home sales drop 17% in September.

Lately, you may have seen headlines that suggest Calgary’s real estate market is experiencing a sharp decline. One such headline highlighted a 17% drop in home sales for September, which could sound alarming at first glance. But before jumping to conclusions, it’s essential to dig deeper into the data and understand the bigger picture.

In the video below, I take a closer look at the actual trends behind the headlines, analyzing sales data over the past several years to provide a more accurate view of what’s really happening.

Check it out:

As you can see from the video, while the headlines might suggest that the market is in serious decline, the truth is far more nuanced. Calgary’s real estate market still follows seasonal patterns, and other factors such as interest rates and inventory levels play a huge role in shaping the market.

If you want to stay informed about the local real estate market or have any questions about how these trends might affect you, don’t hesitate to reach out. My team and I are always here to help.

Below is the full transcript of the video for those who prefer to read along:

Calgary home sales drop 17% in September.INTRODUCTION:

I had a headline cross through my inbox this week that said that Calgary home sales are down. They’re down by 17 % in September. And the byline underneath it said that it was a 17 % drop from last year’s record breaking levels. This caused me to stop and think a little bit. It sounds like maybe it’s a bad headline, but is it really?

Let’s Dig Deeper into Calgary Home Sales Data

I thought that I would go and look at the data myself. Sometimes just looking at month over month or year over year changes doesn’t really tell the whole story because the problem is that this is giving a comparison of one specific month now against another specific month in the past and that not every year acts the same. So I went and looked at all of the sales since 2019. That’s nearly six years worth of data.

Every year on this blue line here, we have an increase in the number of sales in the springtime and a decrease later in the year in the fall. 2020 was a little bit different because of COVID. There’s that extra dip right in the springtime when everything shut down. But aside from that, there was an increase in the spring and a dip in the fall. That pattern repeats itself year after year, but exactly when the increase starts, when that peak happens and when the decrease starts, that’s not the same every single year.

Calgary sales trend chart from 2019 to 2024.

Not really much different than 2023

So in an attempt to cut through some of the noise and this shocking headline, I thought that I would look at the last couple of years before interest rates started to go up in the spring of 2022. About two years ago, we saw almost 4,100 sales in March of 2022. That was the peak of that year. And then it really dipped. We saw rising interest rates all through that year and it dipped to quite a low level in December and January at 1200 sales each month.

2023-2024 sales comparison, 1.8% decrease.

Total sales remain the same

Now, if we look at the graph for the last two years, 2024, and compare it with 2023, those two years are actually very similar. However, some of the underlying things have changed. Interest rates. They’ve remained elevated, but in the early part of 2023, we did see a bit of a rate war, and that brought rates basically to where they are right now for a few months.

The peak in the market was in May 2023, and in June with just over 3,100 sales each of those months. And we had almost the same peak again in 2024 at almost 3,100 sales again that month. So the slope generally goes up in the spring, it hits a peak and then it comes back down.

Let’s take a look at what happened in the first nine months of each of the last two years. That might be telling. In the first nine months from January through September,of 2023, saw 22,096 sales in the same period in 2024, we saw 21,706 sales, which is only a difference of 390 sales over a nine month period compared to the same period last year, or said differently, a 1.8 % decrease. That’s not really something to get terribly concerned about at least not by itself. Now,

Calgary sales and listings graph, 2019-2024.

Home Inventory is climbing

Something that might make this a little bit different than last year is that now for the first time in a long time, we have a lot more inventory. That’s on the red line here. The total number of sales, it’s kind of repeating. It’s similar, but the inventory levels have come back up to what it was in previous years. Now for the first time in a long time, there are two months worth of homes to be sold, meaning it would take two months for all of the homes listed to be sold at the current rate of sales.

That said, in the last two years, we’ve seen an unusually low amount of inventory, which has contributed a lot to the price increases. We’re seeing the line of inventory though, going up by quite a lot, still behind the peak in the spring of 2022, below the peak of the years before that.

Now, obviously being the fall time, we have fewer sales right now than we had in the spring markets of those years, but it’s fall and Calgary’s real estate market really took off four years ago, 2020, 2021, in spite of, and actually largely because of COVID. And we’re still at lower inventory levels than we had for most of those earlier COVID years.

The truth is the sky’s not falling. We might see some slowdown in the number of sales through the fall this year. But if we see inventory levels remain a bit higher, we might see slower price growth in Calgary come spring as interest rates really kick in for Cal and

You know that Calgary is more expensive than it was, but it’s still a much more affordable market than the largest markets in Canada. We still have very high earnings per capita and household earnings in our province and in Calgary. while unemployment is up somewhat, we also know that it’s very cyclical in Calgary and Alberta.

I don’t think that now’s the time to panic. And in spite of that headline number and some other headlines, I feel that headline number is just really misleading and not really representative of the whole story. I encourage you to follow the media, what it says, to read the news, to be aware of what’s going on. But try to read through it sometimes, ask some questions.

My team and I, here to help you. If you have any questions and want to see maybe a different angle or a different interpretation of the headlines or the data, we’re here to provide that. Please like the channel, subscribe to it. Maybe comment on the video, we’ll respond.

We’ll keep giving you more of these updates. Visit our website. We’re here to help you. I look forward to sharing the next one. Thank you.

 

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