Real estate sales activity in Calgary has started off slow in 2023, and the number of new listings in January was the lowest the region has seen since the late-1990s, but big broad-strokes statements like that often become less true when we zoom in for more nuanced context.
On Monday, Zoocasa published an overview of the Calgary real estate market, with region-by-region statistics that illustrate how different regions of Calgary are doing and, specifically, whether the market is leaning towards buyers or sellers at the moment.
Zoocasa used the number of sales and new listings across each region, via the Calgary Real Estate Board, to determine the sales-to-new-listings ratio for each region -- a ratio that serves as a quantitative indicator of how supply is competing with demand, and which way the market may be leaning.
A sales-to-new-listings ratio below 40% is an indicator of a buyers' market, where there is more supply than there is demand, giving buyers more options. A ratio over 60% -- 55% is also used by some, such as the CMHC -- shows a lean towards sellers as a result of demand outpacing supply. Anything in between, then, is a sign of a balance in the market.
By those definitions, Wheatland County is the only region of Calgary where the real estate market is currently favoring buyers, with a sales-to-new-listings ratio of 35%.
On the other end of the spectrum, Mountain View, Airdrie, Calgary, and Willow Creek are each favoring sellers, with sales-to-new-listings ratios between 65% and 68%.
(Zoocasa)
All other markets -- Rocky View, Kneehill, Bighorn, Chestermere, Foothills, and Vulcan -- are currently fairly balanced, with half of those markets -- Rocky View, Kneehill, and Vulcan -- even below the CMHC's stricter 55% threshold.
Those numbers are in fairly stark contrast to those of January 2022, where all 11 submarkets were heavily leaning towards sellers, with the sales-to-new-listings ratio in eight of the 11 submarkets well over 80%.
READ: Calgary Home Sales in 2023 Projected to Surpass Pre-Pandemic Highs: CREB
A significant culprit responsible for that drastic change is, of course, rising interest rates, which began 2022 at 0.25% and are now 4.5% a year later.
Similar to markets in British Columbia, the speed at which interest rates rose forced many who wanted to be active in the market to pause and reassess, with market statistics reflecting that wide-scale caution. In Calgary, however, it appears that the caution has brought a significant portion of the region to a market balance, rather than a point of concern.
