Let’s look back at January 2025 Calgary Real Estate Board (CREB) data to make sense of supply side metrics.

We’ll look at detached and apartment data to help anticipate any near term changes in price.

The stats we target are:

1.  Sales to new listings ratio. 

2.  Months of inventory (absorption).

3.  Average/Median price. 

Detached Homes:

Sales To New Listing Ratio:

The sales to new listing ratio combines sales (homes exiting the market) with new listings entering the market.  

The barometer to quickly assess this chart is assessing the proximity of the data relative to the 100% horizontal line.  

Data closer to, or above the 100% line indicate less near term inventory available for sale.  

Data points further below the 100% line indicate more accumulation of near term new listings.

We can see January 2025 sales to new listing data is much lower than January 2024—but starting to be more in alignment with historical data.  

What does this mean?

Linking this with other stats below, there seems to be a direction to a more balanced market.  Balanced meaning runaway price increases are not forecast.  

Is there competition for good properties, priced well?  Yes.  Are there multiple offers for those properties?  Sometimes.  Is there $90,000 over list offers, with no conditions?  No. 

Months Of Inventory:

Months of inventory = Absorption rate.

This data point tells us how many months it would take to liquidate all inventory for sale, at the pace of this months sales volume. 

If there is ONE data point to look at, to get a sense of the market direction, the absorption rate is worthy to look at.  

For context, a lower number of months of inventory (at or below 2 months) indicates a seller’s market, which typically results in price appreciation. 

Conversely, a higher number of months of inventory (at or above 4 months) indicates a buyer’s market, which typically results in downward pressure on pricing. A balanced market typically has between 2 and 4 months of inventory.

We can look back and see for years Calgary’s detached absorption rate has been chronically below 3 months of inventory, and several times long stretches below 2 months of inventory!

More recently, from about the Summer of ’24, the months of inventory has been generally trending higher.  January 2025 data is also higher month over month, and year over year. 

Again, there is still competition and urgency for highly desirable homes that are move-in-ready and priced well.  It’s becoming more common that buyers are viewing homes more than once, writing offers with conditions and being able negotiate price. 

Average Price:

The average price is slightly down month over month, and up year over year.  This is a lagging indicator of the market, but worthy to note trends.

I’m anticipating a busy spring market that will pull buyers who did not want to compete in previous years.  I’ve also heard many folks say there would be even more sales in Calgary IF there was more inventory for sale.  These two forces might collide?

Apartment Homes:

Sales To New Listings Ratio:

There is a very clear change in year over year data for the apartment sales to new listings ratio.  

The three years of ’22, ’23 and ’24 show very high ratios which indicated low near term supply of apartments.  

January 2025 sales to new listing ratio is at 40% which is closer to the previous seven years of data.  

It looks like more apartments will be available to purchase—relative to the previous three years—over the near term. 

Months Of Inventory:

Calgary’s apartment months of inventory is flat month over month, and well below previous highs.  

With the sales to new listings ratio lower, it’s possible the months of inventory for apartments remain flat or increase—depending on sales of course!  Let’s keep an eye out on this segment.  

Median Price:

We can see a big jump in median price of apartments in 2024.  Year over year, January 2025 is slightly higher than last year.  

With the sales to new listings ratio lower, and absorption currently balanced, Calgary’s apartment market will need one or two things to happen to support current prices: 1) big uptick of sales, 2) very low new listing inventory, or 3) both 1 and 2. 

Bonus Content!

The Calgary Real Estate Board (CREB) publishes an annual forecast.  Here are some highlights—relating to housing supply:

• As of November 2024 there was 22,563 of new construction completed, including 9,340 purpose built rentals (page 8).  
  
• New home starts in 2024 topped out at 22,652 which is higher than new housing starts in 2023 which came in at 19,579 (page 8). 
  
• Purpose build rental starts are reported at 5,000 units (page 9). 

New home supply is coming/here!  CREB is reporting this new inventory will compete with re-sale homes, and is a reason for vacancy rates increasing and rents decreasing. 

Conclusion:

It’s seeming like the detached market is setting up to be supported, while there is definitely divergent data in the apartment segment.  Let’s continue to monitor how demand evolves for Calgary Real Estate. 

Over these past three and a half years the overwhelming consensus was “prices will continue to rise.”  And the market behavior was in alignment with that thinking (I.E., urgently buy now, purchase over list price, remove conditions in offers etc).  

Why?  The past three years saw low inventory, and high demand.

Will that overwhelming consensus and market behavior return this Spring?  You, the market, will tell me.  Reach out with any questions.

Thank you for reading!

Chad Moore