CREB®'s Q2 2022 Housing Market Report
Q2 totals by the numbers
Sales: Up 9,303 (2.4% Y/Y)
New listings: Down 12,937 (-3.25% Y/Y)
Inventory: Down: 5,163 (-21.73% Y/Y)
Benchmark Price: Up $544,733 (14.52% Y/Y)
City of Calgary, August 16, 2022 – Within the city of Calgary, housing sales totaled 18,694 units in the first half of 2022, with sales in the second quarter nearly matching the record high pace set in the first quarter of the year.
“This doesn’t come as a surprise as consumers were eager to get into the market ahead of rate gains while they still had low pre-approval rates,” said CREB® Chief Economist Ann-Marie Lurie.
At the same time, new listings struggled to keep pace leaving inventories relatively low and the months of supply relatively tight. This resulted in prices trending up in the second quarter relative to both the previous quarter and year.
Since April, the Bank of Canada has taken an aggressive stance against inflation with their most significant move in July, which saw a one per cent increase. After four consecutive rate increases, the overnight lending rate has jumped to 2.5 per cent and pushed mortgage rates up to their highest levels in over a decade. The lending rate increases have started to impact home sales and are expected to weigh on sales over the second half of the year, offsetting some of the strong gains reported over the first half of the year.
Supply adjustments in the market have been slow, especially for lower priced products. However, the pullback in demand is expected to help support more balanced conditions.
“With market conditions easing and a higher cost of borrowing, prices are expected to trend down in the second half of the year, offsetting some of the stronger than expected gains in the first half of the year,” said Lurie. “Despite the pullbacks, we anticipate that the annual benchmark price will remain higher than levels reported last year.”
Q2 Benchmark price: $647,467 - up 16.60% Y/Y, up 5.45% quarter over quarter
Rising rates are expected to have the most impact on higher priced inventory. However, the upper range is better supplied than the lower range of the detached market, where there is still a lack of supply relative to the demand . Overall, we continue to expect that sales in the detached market will slow in the second half of the year and prices will trend down from the high point of the year, resulting in a slower pace of growth on an annual basis .
Q2 Benchmark price: $582,100 - up 14.17% Y/Y and 5.62% quarter over quarter
As we move through the second half of the year, we expect to see some adjustments in this sector supporting more balanced conditions and slower price growth.
Q2 Benchmark price: $362,533 - up 16.52% Y/Y and 7.45% quarter over quarter
This segment of the market is expected to continue to benefit from relatively strong demand coming from those looking for affordable housing options . However, as supply choices continue to rise relative to sales, the market should move toward more balanced conditions slowing the upward pressure on home prices.
Q2 Benchmark price: $274,767 - up 9.38% Y/Y and 6.31% quarter over quarter
The tight market conditions supported some of the highest quarterly price gains recorded since 2007, narrowing the spread from the record high prices set back in 2014 . This segment of the market should not see the same degree of pullback in sales as the detached segment of the market, but it will remain sensitive to gains in supply, limiting the pace of price growth in the second half of the year .
Post a Comment