Cooling In The Wrong Places...

I'm a bit late to the game to bring this month's market update, my apologies about that. 

But I think when analyzing the market, it's important to look at the holistic view of how different components of the market have been applying pressure. 

Personally, in my business, I haven't seen a slowdown in the market. This past month alone I've had to compete on two offers I have written (both we won šŸ„³) and have had the great fortune of working with many buyers. 

So when I read articles from the Financial Post or national news outlets advising the public that the markets are continuing to decline, I feel it's really important to dissect what is really happening and share what I've been seeing from both the stats for the month and my personal experience. 

So without further adieu, let's dive into this month's breakdown of how the market has been reacting to the last change of an increase in 75 basis points to the overnight rate by the BOC (Bank of Canada). 

Aggregated Absorption Rates - Calgary


This past month, the absorption rate (the rate at which active listings have been sold) decreased by 3% from the previous month to 40%. with two out of five homes currently selling in today's market, we are still performing stronger than at this same time last year (36%). 

It's also important that the BOC overnight rate at this same time last year was 3% lower than this past month. 

Month over month, the number of new listings has declined by 7% while the number of new sales has dropped a significant 21%. 

Year over year, the number of listings has dropped 26% while the number of sales has also dropped 13%. 

This decline in activity is a bit predictable this time of the year when looking at the trend of the past two years in the above chart. In both 2020 and 2021, we saw that the time between July and September was the lowest time for market activity throughout the year (excluding March and April 2020 due to the pandemic). 

This drop in activity can be attributed to both the higher rates, and also seasonality of fewer sellers listing their homes and fewer buyers taking the time to search for homes in the summer. 

Not to mention the fact that this summer saw most of the pandemic restrictions ease to allow for more travel. 

While market activity is an important statistic to look at, does it equate to what most buyers are hoping for, a decrease in the prices of properties? 

The quick answer? Not at much as you would like! Let's take a look. 

Median Prices Changes

The median single-family detached home price in Calgary saw a decline from a month ago by 1%. From the high point of this year (February - $625,000), we have seen a decline in pricing of 9%. 

Attached or duplex homes saw no significant change in their value, currently $472,000. 

Condominium townhomes (row) dropped 3% from a month ago and currently sit at $330,000 while apartments saw an increase in the median price of 3% to $246,000. 

With activity and absorption rates down, in the same window of the last three months, we have small changes to the prices across all segments. This is important to note since during this time there were two significant BOC rate hikes. 

While rates are continuing to hurt all homeowners from those with new purchases to those that have a variable rate and fixed payment mortgage, a significant amount of the changes we are seeing in price can be attributed to the seasonality of our market, which seems to be following the same trend of activity. 

October 26th is Coming, What Next?

On October 26th, we will have one of the last two interest rate announcements from the BOC this year. It is speculated that another increase will come since our economy in Canada did still grow in the month of September. 

If this change does happen, and an increase does come, what does that mean for our local market? 

This has been a question I have been fielding from my clients and my answer remains the same with these increases. 

The interest rate changes are a national change, our pricing here in Calgary is local. We continue to be one of the lowest-cost markets in the country and more and more people are seeing this. Migration to our city continues to be high. 

You've probably felt that there are more people in Calgary than a year ago. It was recently reported that the traffic activity alone in Calgary has increased by 25% from this same time last year. 

I've had clients move from Ontario and Quebec to Calgary for a number of reasons. Here are just a few:

  • Lower cost of living

  • Reduced debt loads from mortgages

  • Policy changes in Quebec by legislation

  • The ability to work remotely.

  • Relocation of a company to Calgary

And the list keeps growing. 

Those that are feeling the pinch of higher interest rates in Ontario, might look at their situation and think a condo for me in Toronto might be $700,000, while I can find one in Calgary for $246,000 and make that change to better their financial situation. 

Do the higher rates affect our market? Most definitely! But will it be here for a long time? It cannot because it not only slows our housing market but a number of other industries that need the lower rates to return to make their businesses profitable once again. 

My business has continued to be busy these past few months and if you speak to my clients you will see how hard it is still to find a home to purchase, even though they are more affordable than other markets. 

Until the supply issue simmers down, we can continue to see our market remain this way for a bit longer. Lower activity means fewer people are in the market to either buy or sell a home, which makes the market stagnant, causing for little change to the status quo. 

Thank You!

Thank you for taking the time to check out my update. I hope you found it useful. I do still maintain the apartment absorption rates analysis if you'd like to see that. Just shoot me an email and I can get it to you. 

Feel free to reach out with any questions you have, shoot me a text or send me an email at or connect with me on social (IG: @alyjanmohamed). 

Take care and I hope we can connect soon!