On January 24, 2023, CREB® released its 2023 Forecast for Calgary and the region, prepared by Chief Economist Ann-Marie Lurie. The short version: a calmer year after a record one.
Calgary home sales: 2022 actual vs CREB® 2023 forecast
The forecast
- Sales: 25,921, down from the record of 2022 but still above activity before the pandemic.
- Prices: an annual decline of less than 1%. Declines at the upper end are expected to offset gains for lower-priced homes.
- This follows price growth of 12% in 2022.
Why
Elevated lending rates are expected to weigh on demand. On the other side, CREB lists higher commodity prices, recent job growth, record migration and Calgary’s relative affordability. Supply is also very low, which should prevent significant price declines.
CREB expects a split market. Lower-priced homes still face sellers’ conditions, while higher-priced homes are more balanced or even favour buyers. Lurie noted that Calgary did not see the same run-up as other Canadian markets: prices here only recovered from their 2014 highs in 2021.
Our take: if you are buying in the lower price ranges, expect competition. If you are selling a higher-priced home, pricing well from the start will matter more than in 2022.
From a record year to a normal one
The forecast of 25,921 sales is about 3,750 fewer than the record 29,672 sold in 2022, a drop of roughly 13%. That sounds large, but 2022 was exceptional. CREB’s point is that 2023 still looks busier than the years before the pandemic. Lurie described 2023 as an adjustment into more typical conditions and a pause on price gains.
Two forces pulling in opposite directions
On one side are lending rates. After a year of rate increases, a buyer needs more income to qualify for the same mortgage, and some buyers will wait. On the other side, CREB lists higher commodity prices, recent job growth, record high migration and relative affordability. Calgary also starts the year with supply at the lowest levels in over a decade, because gains in listings of higher-priced homes did not offset declines in lower-priced ones.
A split market by price range
The forecast expects prices to move differently depending on property type and price range. Lower-priced homes still face sellers’ market conditions, so prices there can keep rising. Higher-priced homes face more balanced or even buyers’ conditions, and price declines there are expected to offset the gains, for an annual decline of less than 1% overall.
Why Calgary is different from other Canadian cities
Other markets in Canada are forecast to see bigger price and sales declines in 2023. Lurie explained that Calgary did not see the same gains, because its prices only recovered to their 2014 highs in 2021. A market that did not overheat has less to give back.
What it means for you
- First-time buyers: competition for condos and row homes is likely to continue; a strong pre-approval helps.
- Move-up buyers: if you sell a lower-priced home and buy a larger one, the split market may work in your favour.
- Sellers of higher-priced homes: buyers have more choice; price to recent sales, not to spring 2022.
- Everyone: forecasts change with rates; the Bank of Canada’s next decision is on January 25.
What could change the forecast
A forecast is a starting point, not a promise. If rates rise more than expected, sales could fall further than CREB projects. If migration and job growth stay strong while listings remain scarce, the lower price ranges could see more upward pressure than the overall number suggests. We will compare each monthly CREB release with the forecast during the year and point out where the market is running ahead or behind.
