the Calgary Real Estate Market: Trends, Opportunities, and Challenges
The funny thing about the Calgary real estate market, and probably like any other major Canadian city, is that no one has a clue what will happen from month-to-month. Yet, news outlets like CBC, CTV, Global, etc. all post articles about what some “expert” says will happen next.
As I write this article, I googled, “calgary real estate industry news” and quickly saw 10 different opinions. The problem with any real estate prediction is the complexity of the market; you have to consider:
- migration to Calgary
- hires and layoffs in the city
- new home builder capacity (which for 2023 was at 100% capacity – it’s a known fact that there is no extra industrial capacity to build more homes than what got built in 2023)
- zoning and City counsellor approvals for new communities
- mortgage interest rates
- inflation (cost to build a home)
- the rest of Canada discovering that Calgary is the best city in the world to raise a family
So far, in 2023, the Calgary real estate market has been defying the cooling trend seen in other areas, with rising prices and a high demand for homes.
Housing Market:
Calgary’s real estate market is characterized by a high demand for housing, with more people looking at fewer homes on the market In a typical Reddit rant on Calgary’s housing market, someone wrote, “This scarcity has led to increased competition among buyers, resulting in higher property prices. Experts in the industry believe that Calgary’s home prices could rise as much as 40-50% in the next 5 years.”
The most popular comment to the above statement was, “Probably go up…if not it will go down. No one has a magic ball.”
Property Prices:
The limited supply of homes in Calgary has contributed to the surge in property prices. Buyers are willing to pay a premium for desirable properties, leading to bidding wars and increased competition. The scarcity of available homes has created a seller’s market, with sellers having the advantage in negotiations.
Rental Market:
The rental market in Calgary has also seen significant growth, driven by a combination of factors. The tight housing market has made it challenging for some individuals to enter the homeownership market, increasing the demand for rental properties. Additionally, Calgary’s growing population and a strong job market have attracted people from across the country, further fueling the demand for rental housing.
Investment Potential:
Calgary’s real estate market offers promising investment potential. The city’s strong economic fundamentals and diverse industries make it an attractive destination for investors. With the potential for significant price appreciation in the coming years, real estate investments in Calgary offer the opportunity for substantial returns. However, investors should carefully consider factors such as changing demographics, interest rates, the economy, and government policies [3].
Challenges:
While the Calgary real estate market presents numerous opportunities, it also faces certain challenges. The limited supply of homes and rising property prices can make it difficult for first-time buyers to enter the market. Additionally, fluctuations in the economy and changes in government policies can impact the stability and growth of the real estate market.
The Calgary real estate market continues to thrive despite the cooling trend observed in other areas. The scarcity of homes and rising property prices indicate a strong demand from buyers. The rental market is also experiencing growth, driven by population growth and a strong job market. Investors should carefully consider the key factors that impact real estate prices and demand when making investment decisions. While the market offers promising opportunities, challenges such as limited supply and government policies should be taken into account. Overall, the Calgary real estate market remains an appealing destination for both homeowners and investors.
