The pandemic triggered a sharp drop in interest rates, a build-up in household savings, and a change in housing needs. This sent an unprecedented wave of Calgarians rushing to buy a home in 2021.
2021 marked the first year of home price appreciation in Calgary breaking a 6 year slide and bringing us back to 2014 values. Overall a 21% increase over the past decade, barely keeping up with inflation.
Supply chain issues have caused further delays for commodities and raw materials, thus putting pressure on new home construction and development. Housing starts over the past 12 months were the strongest since the mid-1970s, and the number of homes under construction is at an all-time high. The problem is that it takes time for new construction to reach the “move-in” stage. The average timeline to build has more than doubled over the past two decades, from 9 months to 21 months. This has all combined to help keep buyers in the re-sale market.
Average days on market for home sales stand at 40 days. We believe there is plenty of room for upward home price movement over the next year even with the forecast of increased interest rates. From a Nationwide outlook Calgary is still one of the most affordable major cities to live in and one of the youngest median age populations. We are seeing a renewed appetite to re-locate into our City, if inventory levels remain low we can expect 2022 to produce more of the same “hot market” headlines.
What does this all mean to you? Reach out, we would love to discuss.