Calgary is the biggest city in the province of Alberta, and has a thriving economy that includes energy, financial services, health and wellness, aerospace, manufacturing, technology, retail, and tourism. It is considered one of the best cities in Canada to live, the strength of the oil and gas sector has created a fantastic environment for lifestyle and real estate investment in the city.
While not immune to economic downturns, the real estate market in Calgary has been more resilient than other cities in the country. The housing market is always changing, and Calgary has experienced lower property sales volume and declines in price, but most of the homes sold have only had single-digit decreases in real estate value. As the oil sector recover, it is predicted that the housing market will improve too.
If you are interested in buying in the city, here are five ways the Calgary housing market is changing:
1. Improvements in Condo, Attached & Apartment Sales
Buyers are looking for more affordable products. The condominium market has been increasing year-over-year. The attached home and apartment sector has been offsetting the decline in detached homes, which is helping in sales improvements. The real estate marketing for condominiums, connected houses, and apartments will continue to increase gradually.
2. Heading into a Balanced Market
What does a balanced market look like? The demand for all homes (townhouse, detached, condo) are trending towards a position where buyers and sellers have equal power. In the past years, due to the population in Calgary and its exceedingly fast growth, it was a seller’s market and prices increased dramatically. Now, the economy and growth are leveling out. Buyers can leverage, negotiate discounts and incentives. With the balanced market, buyers are receiving positive outcomes of lower prices, more selection of homes. Fewer bidding wars, and less stress.
3. Foreign Buyers Moving to Eastern Canada
Foreign buyers who were swarming the home market in Calgary are now moving to Toronto, Montreal, and Quebec. Real estate pricing in Calgary is a lost less compared to Toronto and Vancouver but still expensive if being compared to Fargo, ND, or Houston, TX.
4. Stabilization in New Home Building
In 2017, the Canadian home building hit a 10-year high but had begun declining since then. It is believed that the new home builds for 2020 and 2021, will be about the same in 2019. This means that the strong labor growth and income increase that come with a favorable market for new home builds won’t be positively impacted by the changing housing market.
5. Long Closing times & Conditional Offers
Closing times, the period between when an offer is accepted, and ownership is transferred, are getting longer. So, if you are selling your home, you need to make sure that the closing time on the property you are selling is longer then the one you are buying. Closing times use to be as short as 30 to 60 days. In a slower housing market, closing times have increased to 90 to 120 days. Many offers are coming with conditional offers, such as being able to sell your home.
Final Thoughts
The housing market is a little uncertain for sellers. Current trends are stating that the longer you wait, the less you will get for your home. Typically, the housing market has for upward pressure from January to June. Then stabilizes in the summer and decreases in the fall and winter. If you are interested in getting into the housing market, contact us now, as it’s an excellent time to buy. It’s important to remember if you are looking to get into real estate, that with the long-term trend of reducing home prices in Calgary, be specific in buying a home that is going to suit your lifestyle, rather than as an investment.