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June sales down due to supply issues and rising prices

June sales down due to supply issues and rising prices
June sales down due to supply issues and rising prices

July 2, 2024 | CREB

City of Calgary, July 2, 2024 — June sales reached 2,738, down 13 percent from last year’s record high. While sales of homes over $700,000 improved, it wasn’t enough to offset the declines in lower price ranges. Despite the decline in June sales, they remain more than 17 percent higher than long-term trends.

“The decline in sales reflects supply challenges at the lower price points, which ultimately limits sales activity,” said Ann-Marie Lurie, chief economist at CREB®. “Inventory at the lower price points of every home type continues to decline, limiting choices for potential buyers seeking a more affordable product. It also remains a competitive market for some buyers, with more than 40 percent of homes sold above asking price.”

New listings also declined relative to sales this month, keeping the sales-to-new-listings ratio high at 72 percent. Inventory levels improved from last year’s lows, largely due to gains in the higher price points. However, with 3,789 units available, levels remain 40 percent lower than long-term trends.

The modest change in inventory levels helped to increase the months of supply. However, at 1.4 months, conditions remain favorable for sellers. Continued tight conditions led to further price increases this month. In June, the unadjusted benchmark price rose to $608,000, up from the previous month and almost nine percent higher than last year. Prices rose across all districts, with the most significant year-on-year increases in the North East and East districts.

Detached

The gain in higher-priced detached home sales wasn’t enough to offset declines in homes priced under $700,000, leading to a 16 percent year-over-year decline in sales. Despite the recent decline, detached home sales in the first half of the year remained in line with levels reported last year. Meanwhile, after several months of gains, new listings slowed this month. There were 1,775 detached homes in inventory at the end of June, an improvement over last year but 45 percent below long-term trends for the month.

While conditions in the detached market remain tight, we are starting to see a better balance between supply and demand at the higher end of the market. Months of supply have ranged from a low of one month in the most affordable eastern district to just over two months in the city centre. Nevertheless, with less than a month and a half of supply, we continue to see upward pressure on house prices. In June, the unadjusted benchmark price reached $767,600, almost one percent higher than the previous month and 12 percent higher than prices reported in June of last year.

Semidetached

After a significant gain last month, new listings declined relative to sales in June, pushing the sales-to-new-listings ratio to 76 percent. While this didn’t prevent some gains in inventory levels, inventory levels remained nearly half of what we traditionally see in June.

With just over a month of supply, we continue to see upward pressure on house prices. In June, the unadjusted benchmark price reached $686,100, up one percent from the previous month and more than 12 percent higher than levels reported last year. Prices rose across all districts in the city, with the steepest increases occurring in the most affordable areas of the North East and East districts.

Queue

Like other types of real estate, townhome sales slowed in June from the highs seen over the past two years. A steeper drop in sales relative to new listings caused the sales-to-new-listings ratio to fall to 75 percent, the lowest level in June since 2021.

However, conditions remain exceptionally tight with one month of supply, particularly for properties priced under $600,000. The unadjusted benchmark price edged higher in June, reaching $464,600, nearly 17 percent higher than levels reported at this time last year. While price adjustments varied by location, we continue to see the highest price growth in the most affordable districts.

Apartment Condominium

There were 791 sales in June, down nearly eight percent from last year. The decline in sales was primarily due to a significant drop in units priced under $300,000. Limited supply for lower-priced products is preventing stronger sales activity. Despite the monthly decline, condo sales are up 13 percent year-to-date and are at record highs.

New listings continue to outpace sales, lowering the sales-to-new-listing ratio and fueling further inventory gains. However, much of the supply growth has been at higher-end properties, resulting in tighter conditions at the lower end of the market and more balanced conditions at higher-end units. Overall prices continued to climb this month, reaching $344,700, up more than 17 percent from last year.

REGIONAL MARKET FACTS

Airthree

Sales in June remained relatively stable compared to last year at levels well above long-term averages. At the same time, we saw an increase in new listings this month compared to last year. However, with 269 new listings and 209 sales, the sales-to-new-listings ratio remained high at 78 percent, keeping inventories relatively low by historical standards.

Like Calgary, Airdrie is experiencing the tightest conditions for the most affordable sectors of the market, and prices continue to rise. In June, the unadjusted benchmark price rose to $554,500, up almost one per cent from the previous month and nine per cent from year-ago levels. Price growth is highest for condos.

Cochrane

Sales in June improved from last year’s levels, contributing to a seven percent gain this year to date. This was made possible by the increase in new listings in June. However, the gain in new listings had little impact on inventory levels, which remained consistent with levels reported last year and are 44 percent lower than levels typically seen in June.

With nearly a month and a half of supply, conditions remain favorable for sellers, driving further price gains this month. In June, the unadjusted benchmark price was $571,100, up from the previous month and nearly nine percent higher than year-ago levels. As with Airdrie, price growth was strongest for apartments, which are also the most affordable products available in the city.

Okotoks

Sales in June slowed compared to last year, primarily due to a decline in the detached sector. Sales activity is somewhat subdued due to limited delivery options. Inventory was 81 units in June, down 56 percent from levels typically seen in the month, and detached inventory is down nearly 63 percent.

Continued tight market conditions have kept prices high compared to last year. Although there have been some monthly fluctuations, prices so far this year are almost nine percent higher than last year.

Click here to view the City of Calgary’s full monthly statistics package.

Click here to view the full monthly statistics package for the Calgary region.

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