November 2024 Real Estate Market Report: Calgary and Surrounding Areas
In October 2024, Calgary’s real estate market demonstrated resilience amid evolving conditions. The Calgary Real Estate Board (CREB®) reported 2,174 sales for the month, a slight increase from September’s 2,003 transactions, and closely aligning with October 2023’s figures. In fact, the number of residential transactions was up 0.14% compared to October of last year.
Sales and Listings Dynamics
The market experienced a notable uptick in new listings, reaching 3,687 in October—the highest for this month since 2008. This surge contributed to an inventory increase to 5,064 units, nearly double the exceptionally low levels reported in the spring, but still below the 6,000 units we typically see at this time of year.
Price Trends
The unadjusted benchmark price for a residential property in Calgary was $592,500 in October, reflecting a slight decrease from the previous month but maintaining a year-over-year increase of 4.5%. Year-over-year gains ranged from approximately 8 per cent growth for detached homes to over 11 per cent gains in the apartment condominium market.
Surrounding Areas
- Airdrie: Inventory levels rose to 349 units in October, an improvement over the persistently low levels reported over the previous three years. With 151 sales, the months of supply increased to 2.3 months. The unadjusted benchmark price reached $551,000, nearly seven per cent higher than last year.
- Cochrane: Sales in October totaled 58 units, while new listings reached 116, resulting in a sales-to-new listings ratio of 50 per cent. Inventory levels improved to 174 units, pushing the months of supply to three months—the first time it has reached this level since the end of 2020. The unadjusted benchmark price was $571,800, nearly six per cent higher than last year.
- Okotoks: New listings outpaced sales, leading to an inventory increase to 106 units. The months of supply reached two months, indicating a shift toward more balanced conditions. The unadjusted benchmark price in October was $630,300, nearly one per cent higher than last month and nine per cent higher than levels reported last year.
Interest Rates and Buyer Sentiment
The current interest rate environment significantly influences buyer behavior in Calgary’s real estate market. As of October 23, 2024, the Bank of Canada reduced its target for the overnight rate to 3.75%.
This reduction marks a continued shift from the previous period of higher rates aimed at curbing inflation. The Bank of Canada’s projections suggest that inflation is expected to return to the 2% target in 2025, with the nominal neutral interest rate estimated to be in the range of 2.25% to 3.25%.
Despite the recent rate cut, many potential buyers remain cautious, opting to wait for further clarity on the interest rate trajectory into 2025. This hesitation is influenced by expectations of additional rate reductions, as indicated by the Bank of Canada’s forward guidance and market forecasts. For instance, the Bank’s schedule for 2025 includes multiple policy interest rate announcements, reflecting a commitment to adjusting monetary policy as needed to support economic growth and maintain inflation targets.
This “wait-and-see” approach among buyers contributes to a dynamic market environment, where purchasing decisions are closely tied to anticipated changes in borrowing costs. As interest rates are a critical factor in mortgage affordability, even slight adjustments can significantly impact buyer confidence and market activity.
Advice for Buyers and Seller
- For Buyers: The increase in new listings, particularly in higher price ranges, offers more options. However, with inventory levels still below long-term trends, competition remains, especially for lower-priced properties. Buyers should be prepared to act swiftly and consider pre-approval for financing to strengthen their position. While waiting for potential further rate cuts might seem advantageous, it’s essential to consider that housing prices may adjust in response to increased demand once rates decline. Engaging with a mortgage advisor to understand current options and securing pre-approval can provide a competitive edge.
- For Sellers: While the market is gradually shifting toward balanced conditions, it continues to favor sellers, particularly in the lower price ranges where supply remains limited. Accurate pricing and strategic marketing are essential to attract qualified buyers and achieve favorable outcomes. Understanding that some buyers are currently hesitant due to interest rate uncertainties is crucial. Pricing properties competitively and highlighting unique selling points can attract serious buyers who are ready to proceed despite the fluctuating rate environment.
In summary, Calgary and its surrounding areas are experiencing a dynamic real estate market in October 2024, characterized by increased listings and stable sales. Both buyers and sellers should stay informed and work closely with their REALTORS® to navigate these evolving conditions effectively.
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Ryan Smith
Broker | Director of REALTOR® Development