Inventory Grows and Sales drop off - Seasonal Expectations

It’s that time of year again when we normally start to see sales drop off as we head into the fall and winter months. The overall market has moved into a much more balanced state. The days of the crazy multiple offer are diminishing unless of course, it is a hot property and/or priced aggressively. Approximately 38% of all September sales in Calgary sold for list price or higher. 18% of the properties sold for over list price with the assumption being that there were multiple offers on the majority of those sales. It is a good reminder for sellers as our market shifts downward to price fair out of the gate. A few factors effecting sales and inventory over the next could months is the up coming election in the US, world wide events such as the escalation of war in the middle east, oil prices (Alberta) and interest rate drops expected in the near future.

First time buyers should start to see some relief. For everyone else, it is all relative if you buy and sell in the same market.

Q2 2024 population growth for Alberta

Population growth is a big driver of real estate transactions both for new builds and the residential resale and rental market. Alberta was the only province to register significant net gains from interprovincial migration, adding 9,654 people in the second quarter. Nova Scotia posted the next highest net interprovincial gains at 1,266. This was the eighth quarter in a row that Alberta registered the highest net interprovincial gains. Natural increase added 4,669 people in the second quarter, the balance of 13,004 births and 8,335 deaths. Alberta had the highest natural growth rate amongst the provinces at 0.1% among all provinces.

Calgary housing market shifts with Okotoks and High River holding steady

In Calgary, Housing sales activity continues to move away from the extreme sellers’ market conditions experienced throughout the spring. Easing sales, combined with gains in supply, pushed the months of supply above two months in August, a level not seen since the end of 2022.
“As expected, rising new home construction and gains in new listings are starting to support a better-supplied housing market,” said Ann-Marie Lurie, Chief Economist at CREB®. “This trend is expected to continue throughout the remainder of the year, but it’s important to note that supply levels remain low, especially for lower-priced properties. It will take time for supply levels to return to those that support more balanced conditions.”
Inventory levels in August reached 4,487 units, 37 per cent higher than last August but nearly 25 per cent lower than long-term trends for the month. Higher-priced properties mostly drove the supply gains, as the most affordable homes in each property type continued to report supply declines.

Both Okotoks and High River held steady for sales and inventory but we are starting to see a shift happening. New construction projects are hitting the market in full swing. Sellers of pre-owned homes will have to be more patient in selling and tame expectations on getting a quick sale with multiple offers (unless the property is priced very aggressive). Sellers and real estate agents will need to be careful not to overprice listings as we head into the fall and winter months.

Buying and selling in the same market is all relative. First time home buyers or move up buyers are the ones that will benefit most from the shifting market conditions with some possible downward pressure on price this fall.

Your new home awaits.