Calgary Sellers’ Market Conditions Expected to “Persist” Into 2024

According to the Calgary Real Estate Board’s 2024 forecast, Calgary’s 2024 housing market may continue to favour sellers and see price increases.

By Brett Surbey | 4 minute read

According to the Calgary Real Estate Board’s 2024 Market Forecast Report, Calgarians won’t be facing as tight of housing conditions compared to 2023. But that doesn’t mean they’re entirely out of the woods.

Last year was one for the books for Alberta. Record-high interest rates, devastating wildfires across the province, and inventory shortages not seen since 2006 were some of the key pressure points from last year in Alberta’s housing market. And boy, did we feel them. Homebuyers and sellers alike — though sellers arguably — had the market in their favour. 

One area that faced many of these challenges was the ever-growing city of Calgary. On January 23, 2024, the Calgary Real Estate Board (CREB) released its much-anticipated 2024 Forecast Calgary and Region Yearly Outlook Report, drawing attention to Calgary’s unique housing situation in 2023 and how things could shape up for this coming year.

A Year Defined by Limited Supply and High Rates 

Ann-Maurie Lurie, Chief Economist of CREB and creator of the report, summed up the core challenges facing Calgarians in a press release. “Despite higher [interest] rates, 2023 was a year of relatively strong sales thanks to a robust labour market and strong migration. The challenge was limited supply, especially for low-priced homes with the strongest demand,” she noted. 

The report indicated that migration to Alberta – both internationally and interprovincially — was one of the main contributors to tightening housing conditions. To put it into perspective, Alberta welcomed just over 45,000 individuals from other provinces, almost reaching the record high of 2006 in terms of migration, according to CREB’s report. 

This spike in Calgary’s population — along with high interest rates — then prevented current homeowners from selling out of their housing situation, which led to a large disparity between housing supply and demand. Calgary saw a 26% year-over-year (YoY) drop in housing inventory, and a 20% decrease in months of available supply — down to 1.34 months’ worth. 

Both of these conditions led to significant price growth in Alberta’s hub: a 6% YoY increase in the city’s benchmark price. All of these events made Calgary’s housing market ideal for sellers, a trend that will likely continue into the first quarter of this year.

Sellers Could (yet again) Be in the Driver’s Seat  

Looking ahead to 2024, Lurie expects Calgary’s market to be in the favour of sellers, due to persisting supply constraints, ongoing interprovincial migration and rates easing up. “We expect potential buyers, who were on the sidelines due to limited supply choices, to re-enter the market as lending rates ease and listings improve. At the same time, interprovincial migration and a healthy labour market should continue to support stronger sales activity,” she stated. 

The report noted that there is an “expectation” interest rates will drop this year, potentially down to 4% by Q4, which bodes well overall. With more mortgages slated to renew this year and more homebuyers potentially jumping into the market seeing favourable conditions, housing supply could see an uptick. But Lurie doesn’t think it’s enough to outpace migration into the city and Calgary’s healthy job market. 

“Given the persistent strong demand driven by recent migration and a healthy job market, it will take time for supply levels to rise sufficiently to restore balance to the market,” she stated in the report. “…Ultimately the level of construction will have to be more in line with the migration figures before we see a substantial adjustment in supply.”

Similar Price Increases Seen in Surrounding Areas, Edmonton Excluded

Surrounding areas such as Airdrie, Okotoks, and Strathmore saw sharp decreases in supply and upticks in benchmark prices of around 5 to 6% YoY. According to the report, these localities’ affordability and lack of supply led to a jump in price increases similar to Calgary’s situation.

Conversely, though Edmonton had decreases in supply (approximately 10% YoY), the effect on its benchmark price was nowhere near Calgary. Edmonton’s average home price hovered around $368,000 — a decrease of over 4.5% from 2022. 

The reason? The report notes Calgary has taken on a larger share of interprovincial migration, supporting sales growth and simultaneously pressuring housing supply. Edmonton also started off 2023 with greater supply than Calgary, which prevented housing prices from rebounding. Classic supply and demand at work.

Though Edmonton did avoid the major price gains Calgary was hit with, Alberta’s second-largest city could still see price surges this year. “Edmonton prices are forecast to rise this year, as recent shifts to tighter market conditions will persist given expected gains in employment and migration,” the CREB report said. 

Unfortunately for buyers in Calgary, Edmonton’s southern sister could continue to see price gains that outpace its hockey rival, according to the report.“As we enter 2024, conditions remain tighter in Calgary compared to Edmonton. Despite recent shifts in the Edmonton market, the expectation is that price growth in Calgary will still outpace growth in Edmonton in 2024.”