A new survey from Royal LePage continues to paint a rosy picture for Calgary’s real estate market in the months to come.
“Calgary’s real estate market finished the year strong, and I believe the trend will continue into the spring market in 2022,” Royal LePage Benchmark broker Corinne Lyall said. “As demand continues to outpace supply in one of the country’s most affordable major cities, prices are expected to continue increasing.”
The Royal LePage house price survey shows the aggregate price of a home in Calgary increased nine per cent year-over-year to $576,800 in the fourth quarter of 2021.
Meanwhile, the median price of a single family detached home increased 11.6 per cent to $650,800, while the median price of a condominium increased 3.0 per cent to $224,700 during the same period.
“A lack of inventory, especially in the lower end of the detached market, continues to drive price appreciation and create an increasingly competitive environment for first-time buyers,” Lyall said.
“A booming job market, quality of life and affordability are among the top factors contributing to the current increase of demand for housing in Calgary.”
Calgary realtor Len T. Wong agrees that a lack of inventory is one factor helping to push prices higher.
“Typically we don’t get busy until maybe the end of January to the first part of February,” Wong said. “What we’re seeing right now is when new listings are coming up (homeowners) aren’t accepting offers until two or three days down the road to ensure they’re getting maximum value.”
“We’ve seen some of the townhouses actually start to get activity because there’s no inventory for single-family detached homes and now they’re going to Plan B.”
Wong also said he’s seeing an increase of people outside of Alberta interested in buying in Calgary, some of them opting to put in an offer before even stepping foot in the home.
“We’re back to bidding wars,” he said. “A lot of times the younger generation or the first-time buyer enters the marketplace and they lose out two or three times and it causes anxiety.”
That’s why Vancouver residents Thomas Grier and Sarah Massie opted to buy their home in Calgary virtually.
“We found that… the Calgary market was going to heat up as we moved away from the winter (season) and so it put a little bit of pressure on us,” Grier said. “You would have to go about an hour or two outside of Vancouver to find something comparable to what we got in Garrison Greens in Calgary.”
“Having the opportunity to really see what is available and in our price range in Calgary, we just decided to go for it,” Massie explained.
Mount Royal University economics professor Anupam Das said other factors driving up Calgary house prices include higher oil and gas prices, supply chain issues as well as lower interest rates.
“One thing everyone should take into account is that eventually the Bank of Canada will increase the interest rate, so the mortgage rate will go up too,” Das said. “In the future when we will renegotiate our mortgage, we’ll probably have to pay higher rates.”
Nationally, the survey shows housing prices are also doing well in other parts of Canada with the aggregate home price increasing more than 17 per cent year-over-year to $779,000 in the final quarter of 2021.
The national median price of a single family detached home also rose 21.1 per cent year-over-year to $811,900, while the median price of a condominium increased 15.8 per cent year-over-year to $553,800.
“Like a bad dream that disrupts your sleep for months on end, we ushered in 2022 with a fresh round of pandemic restrictions,” Phil Soper, the president of Royal LePage said. “Thousands of Canadians have been redirecting their growing savings into improving living conditions, as the family home doubles as office, restaurant and schoolroom.”
In December, Royal LePage issued its 2022 forecast stating that the national aggregate price of a home is expected to increase 10.5 per cent year-over-year.