The Future of Calgary Real Estate will SCARE You. My 2024 Market Prediction.

Summary

The video script discusses the contrasting effects of Calgary's booming real estate market on homeowners and renters. While homeowners benefit from increased property values due to high immigration and job opportunities, renters face rising costs and job insecurity. The speaker analyzes 2023's housing stats, revealing a significant price increase driven by supply and demand. Predictions for 2024 suggest continued high demand, low inventory, and possibly falling interest rates, which could further inflate housing prices. The script advises viewers to prepare financially and make informed decisions based on their individual circumstances.

Takeaways

• 🏙️ The city is experiencing a boom with increased property values due to high migration for affordable homes and jobs.
• 📈 Homeowners have benefited from increased net worth, while renters face higher costs and less job security, creating a 'Tale of Two Cities'.
• 📊 Calgary's real estate board underestimated the average benchmark price for 2023, which ended up being $570,000 instead of the predicted $526,000.
• 🌐 Strong immigration and low housing supply have led to a significant increase in housing prices, despite high interest rates and lower job growth.
• 📉 There was a slight decrease in sales year-over-year, but this was offset by a 30% increase in rent, making purchasing more attractive.
• 💡 Affordability concerns have shifted buyer demand towards more affordable housing options like row housing and apartment-style condos.
• 📉 Persistently low supply levels in 2023, averaging 44% below the 10-year average, heavily favored sellers and affected pricing and availability.
• 🏘️ Calgary is still considered a bargain in the context of the Canadian real estate market, but it's starting to lose its affordability edge.
• 📈 Apartment-style condominiums saw the greatest growth in sales and pricing, increasing by over 133% compared to the previous year.
• 🌐 High immigration is expected to continue into 2024, maintaining the strong demand for housing.
• 💰 The speaker predicts that housing prices will continue to rise in 2024, possibly by more than the Calgary real estate board's prediction of 10%.

Q & A

What has been the impact of increased migration on homeowners and renters in the city?

Homeowners have experienced increased property values and more net worth due to high migration, while renters have faced increased costs, less affordability, and less job security.

Why did the Calgary real estate board's initial prediction for the average benchmark price in 2023 turn out to be incorrect?

The board underestimated the impact of strong immigration and low housing supply, which led to a significant increase in housing prices, finishing the year at $570,000 instead of the predicted $526,000.

What factors have contributed to the increase in housing prices despite higher interest rates and lower job growth?

The strong demand from immigration has outpaced the downward pressures of higher interest rates and lower job growth, resulting in a continued rise in housing prices.

How did the rental market's increase impact the decision to purchase a home in 2023?

The 30% increase in rent made purchasing a home more attractive as it would result in lower monthly costs compared to paying the increased rent.

What was the general trend in sales for the Calgary real estate market in 2023 compared to the previous year?

There was a slight decrease in sales year-over-year, but the market still supported 27,600 transactions, helped by the increased rent which made home ownership more appealing.

Why did the demand for row housing and apartment-style condos increase in 2023?

The high cost of living and affordability concerns led to a shift in demand towards more affordable housing options like row housing and apartment-style condos.

What was the average supply level of homes in 2023 according to the Calgary real estate board?

The supply levels in 2023 were persistently low, averaging 44% below the 10-year average, which heavily favored sellers and affected pricing and availability.

How does Calgary's affordability compare to other major Canadian cities like Vancouver, Toronto, and Victoria?

While Calgary is still more affordable than Vancouver, Toronto, and Victoria, it is starting to lose its edge as it now takes 47.1% of a household's income to service the mortgage debt, up 8% from the previous year.

What was the performance of the apartment-style condominium market segment in 2023, and why was it an outlier?

The apartment-style condominium market had more sales than the previous year and experienced over a 133% impact on pricing, making it an outlier due to its increased demand and relatively more affordable nature.

What are the three nearby markets outside of Calgary that have become more attractive to homebuyers?

The nearby markets of Airdrie, Okotoks, and Cochrane have become more attractive due to their affordability compared to living in Calgary itself.

What are the three key factors that the speaker believes will influence the real estate market in 2024?

The speaker believes that continued high immigration, the lack of inventory to meet demand, and potential decreases in interest rates will be the key factors influencing the real estate market in 2024.

What prediction does the speaker make for the real estate market in 2024, and why?

The speaker predicts that prices will go up, possibly by more than 10%, due to continued high demand from immigration, limited inventory, and potentially lower interest rates, which could inflate asset prices.

What advice does the speaker give to potential homebuyers who are concerned about affordability and timing in the current market?

The speaker advises potential homebuyers to not give up, to take steps to prepare for the future such as saving for a down payment or improving credit ratings, and to make decisions based on their individual financial situations rather than external pressure.