This is the Calgary real estate market update for May 2021. As always,
we deep dive into the stats every single month to help you understand the sales,
inventory, and pricing.
If you're a home buyer or seller, you don't want to miss this.
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Now let's do this first.
Let's talk about sales to see the Calgary real estate market has been hot is an
understatement. We have continued our momentum from May,
2020 all the way until now and it continues to build.
Last month was the best-selling April in the history of the Calgary real estate
board - a total of 3,209 homes were sold!
Check out this graph that shows April sales for last 15 years.
And we surpassed the boom of 2005 to 2007 and even the peak of
2013 and 2014. Among ever changing economic situations.
and COVID-19 lockdowns,
our market has completely recovered and have formed well
above pre pandemic levels.
Now take a look at this graph showing sales per week,
the blue line represents the same time last year when we were in the beginning
of our first lockdown. We were only selling around 125 homes per week.
The red line here represents this April and we are in the range of 750
homes per week. That's a 600% increase in sales.
A few factors that are driving this buyer demand,
low mortgage rates and a proposed review of stricter stress test is set for
June 1st.
The vaccine rollout with higher availability and more people getting their
vaccinations. This is providing more confidence in Alberta's recovering economy.
Another evidence of this is the unemployment rate and the peak.
It was at 11.3%, which has now fallen to 9.1%.
And Felix Chan and I have been talking about increased migration to Calgary from
other cities that have now become unenforceable.
And these are not just home buyers.
There are also investors who are looking to make their mark in a relatively
inexpensive Calgary market compared to cities like Vancouver or Toronto.
Now take a look at this chart that shows sales per day,
and you see that towards the end of April sales did slow down slightly and on
this table,
it shows that different price ranges perform differently while all price ranges
were doing well when compared to April, 2020,
there were many price ranges in the high end luxury home segment shown in green
to have over 1000% growth.
We saw the biggest growth in the $850k to $900k range with a
whopping 3800% sales growth. Inventory.
We started April with a total of about 5,400 homes on the market,
which is about 7.5% less total inventory than last year.
And by the end of the month, we had a total of almost 61 homes,
which was an inventory of 7.5% more than last year in terms of listings per
week. In the first half of April,
we were averaging about 168 new listings hitting the market.
And by the beginning of May we were around 134 homes.
Inventory levels were different for each property type.
Detached homes had 1.5% more road town homes at
10% more with semi-detached we saw a 12% increase and
33% more for apartments. You might be asking yourself, what does this all mean,
Jaz? We are not currently in a low inventory situation.
As you saw. Our total inventory actually increased throughout April.
An important concept to understand here is that our current sellers market is
actually being driven by increased buyer demand. Pricing.
With the increased demand for homes comes with an increase
in benchmark prices. And city wide,
we saw a year over year 9% increase did give you some perspective.
This price level is very similar to where April 2015 was,
which was just shy of the peak in 2014 and across Calgary,
we saw benchmark price gains,
but we need to drill down into the different quadrants of the city to better
understand what's going on. And from this chart,
you can tell that the suburbs had more gains than the inner city.
And to dive at it even a bit deeper.
Each property segment also saw increases, but at varying levels.
Detached homes are up 11%. Row and townhomes increased by 6%.
Semi-detached homes saw an uptick of 8%,
and finally apartments are gains of 4%.
You've probably already heard stories of people selling their homes for well
over this price, but is this true?
Take a look at this chart that shows the sales to list price ratio for different
price ranges. On average,
the $400k to $800k homes are selling for pretty much less price while
one's lower or higher than this range are much softer. All right,
I just threw a ton of stats at you and normally we would end this segment with
advice for buyers and sellers,
but instead we believe it would be more valuable for you to summarize everything
and tie in sales, inventory, and price and what it means as a whole.
So you can understand the bigger picture. To wrap things up,
there are two metrics we can analyze in the first is sales to new listing
ratio. By the end of April,
there were 74% homes sold versus new listings coming to market.
So three out of four new listings were being sold.
Even with the record sales volume.
This indicates the market is not overheated and remains healthy.
The second metric to tie things together is the months of supply or how
many months at the current sales pace it will take to absorb all the existing
inventory we started in end of the month around 1.9 months,
even with a higher than normal number of sales happening.
This also points to a strong and healthy market and pace,
and there's no evidence of a real estate bubble forming.
It may seem that things are overheated,
but really in comparison to the last seven years of a much,
much slower Calgary real estate market outlook. Well, that's it!
We hope that you found a ton of value in our channel here at LiveInnerCity,
and we appreciate you for following us on our journey. We have huge,
huge plans coming, so be sure to stay tuned. I'm Jasben Lai,
and it is my pleasure to serve you. We'll see you next time.