Real estate in Calgary - another bubble?

[MillerTime GFG]

Good ol' Harry Dent with his typical "spray and pray" forecast.

[blankall]

Originally Posted by The Yen Man

The pace of suburb condos going up is insane though (up here in Sage Hill, they have several projects going on at once). I think the housing market in Calgary is still pretty warm, but I don't think the condo market is (or ever has been to be honest).

Apparently, the condo market in Calgary is expected to rise:

https://calgaryherald.com/business/r...20%24286%2C562.

Calgary’s real estate market has “bucked the trend,” the report notes, as it continues on its upward price trajectory.

Condominiums are expected to see the largest price jump, projected to increase 9.5 per cent by the end of the year to $286,562. Meanwhile the median price of a single-family detached house is expected to rise six per cent to $803,692.

As long as population growth continues at a record rate and the government doesn't fix supply issues, prices will go up. A lot of levels of government are forcing through measure to increase supply, but it'll be years before those measure actually translate into more supply. Even then, will that supply account for the 3-6 million new Canadian residents over the next 3 years or put Canada even further behind?

[Izzle]

Calgary city council passed an affordable housing plan back in September 2023.

https://calgaryherald.com/news/local...ved-whats-next

Seems very far reaching and will be bringing in more supply in a variety of ways. This probably puts a cap on how high Calgary real estate can go.

[blankall]

Originally Posted by Izzle

Calgary city council passed an affordable housing plan back in September 2023.

https://calgaryherald.com/news/local...ved-whats-next

Seems very far reaching and will be bringing in more supply in a variety of ways. This probably puts a cap on how high Calgary real estate can go.

Calgary's issues are different than a lot of other cities, as actual land supply is less of an issue. Labor and supply shortages will likely continue to be a major issue in
Calgary though. It's one thing to actually allow people to build and another to actually get the units built. Canada doesn't really have the capacity to build huge amounts of housing quickly. We should have been building at a steady pace for the last ten years. Now we're in a huge hole.

[Vinny01]

I have a condo in Sunnyside I bought back in 08 when i was 24 and have been renting it out since 2011. The condo fees have more than doubled and while I have a good tenant and just dropped my property manager it still costs more money than it brings in. I would love to dump it but I would take a massive hit on it. I really hope the condo boom continues. If I could sell if for what I paid for it I would move it tomorrow

[monkey brewery]

Are seniors downsizing going to put even more pressure on younger, first time home buyers? I've been thinking about this recently.

Up until about last year we've talked about eventually downsizing (we're 60's), and central to these plans are moving into a condo or something a little easier to manage as we get older, and/or a place we'd feel comfortable leaving locked up while we head south. It's not a financial retirement issue per se.

in 2020-21 we were looking at condos for 250-350k on the low end and 500-600k for something a bigger. Today we're looking at 400k at the bottom. It's of course all relative to where you want to live and how you want to live, so your mileage will vary.

Today we're looking at what I would categorize as a first time buyer's condo. Another idea is an active senior living facility down the line (I for one would rather just go ahead and die at this point in my life, my wife thinks they'd be great for us).

This all has me thinking where do first time buyers go? As seniors start to sell-off, downsize, die-off and what have you, I think there's this expectation that the market will suddenly be flooded with all these prime houses in established areas. But what I don't hear a lot of commentary about is how those selling are going to put a lot of pressure on younger buyers, in all quadrants.

Our property tax assessment came in at an astonishing number, and houses in our neighborhood sell well above that even after interest rates cooled the market. It's frankly insane, and there's a reason there are hardly any kids in this neighborhood as it it. Who's going to be buying these houses? The next generation of seniors?

[blankall]

Originally Posted by monkey brewery

Are seniors downsizing going to put even more pressure on younger, first time home buyers? I've been thinking about this recently.

Up until about last year we've talked about eventually downsizing (we're 60's), and central to these plans are moving into a condo or something a little easier to manage as we get older, and/or a place we'd feel comfortable leaving locked up while we head south. It's not a financial retirement issue per se.

in 2020-21 we were looking at condos for 250-350k on the low end and 500-600k for something a bigger. Today we're looking at 400k at the bottom. It's of course all relative to where you want to live and how you want to live, so your mileage will vary.

Today we're looking at what I would categorize as a first time buyer's condo. Another idea is an active senior living facility down the line (I for one would rather just go ahead and die at this point in my life, my wife thinks they'd be great for us).

This all has me thinking where do first time buyers go? As seniors start to sell-off, downsize, die-off and what have you, I think there's this expectation that the market will suddenly be flooded with all these prime houses in established areas. But what I don't hear a lot of commentary about is how those selling are going to put a lot of pressure on younger buyers, in all quadrants.

Our property tax assessment came in at an astonishing number, and houses in our neighborhood sell well above that even after interest rates cooled the market. It's frankly insane, and there's a reason there are hardly any kids in this neighborhood as it it. Who's going to be buying these houses? The next generation of seniors?

Seniors having less housing space, generally, opens up more housing space for young people/families. Seniors downsizing is good for young people. Seniors holding onto excessively large homes with empty rooms is what's bad for everyone trying to buy in.

I suppose some markets have a vast shortage of entry level condos, but, from what I've seen, not Calgary. Calgary condos also seem like a really poor place to build equity. With interest rates higher and condos not really going up in price since basically the late 2000s, you would have been much better off investing the money elsewhere and renting. (See Vinny01's post 1 post up from yours.)

[DoubleF]

Originally Posted by monkey brewery

Are seniors downsizing going to put even more pressure on younger, first time home buyers? I've been thinking about this recently.

Up until about last year we've talked about eventually downsizing (we're 60's), and central to these plans are moving into a condo or something a little easier to manage as we get older, and/or a place we'd feel comfortable leaving locked up while we head south. It's not a financial retirement issue per se.

in 2020-21 we were looking at condos for 250-350k on the low end and 500-600k for something a bigger. Today we're looking at 400k at the bottom. It's of course all relative to where you want to live and how you want to live, so your mileage will vary.

Today we're looking at what I would categorize as a first time buyer's condo. Another idea is an active senior living facility down the line (I for one would rather just go ahead and die at this point in my life, my wife thinks they'd be great for us).

This all has me thinking where do first time buyers go? As seniors start to sell-off, downsize, die-off and what have you, I think there's this expectation that the market will suddenly be flooded with all these prime houses in established areas. But what I don't hear a lot of commentary about is how those selling are going to put a lot of pressure on younger buyers, in all quadrants.

Our property tax assessment came in at an astonishing number, and houses in our neighborhood sell well above that even after interest rates cooled the market. It's frankly insane, and there's a reason there are hardly any kids in this neighborhood as it it. Who's going to be buying these houses? The next generation of seniors?

No, I don't think so. At least not a significant level. But I could be completely wrong. The biggest issue in Calgary/Edmonton over the last few years were young families cashing out their homes in Vancouver/Toronto and coming here + willing to put up $50-100K+ in premium to avoid coming over to a weird and awkward scenario.

Then I presume condos spiked due to rent affordability and some people buying condos by cashing out investments to avoid rental supply issues and fighting the masses in grabbing whatever lower rents were available. This pool of demand was basically both locals and people new to the city.

Retirees suddenly flooding the market with non-reno'd homes should not be another huge shock. Movement trends, sure. But not shock. I think much of the supply will be horizontal with some families fighting to get into certain communities to address certain children school scenarios (that's its own separate issue) or people upsizing from condos to address growing family sizes etc. With the initial stream of families coming over from Vancouver/Toronto/immigration slowing down a lot and implementation of recent property flipping tax rules in 2023, I also think this will keep property flippers from excessively adding to the frenzy.

I'm seeing quite a few million dollar reno'd homes stuck on the market recently. I think we might start circling back down to the types of pricing demands and homes that people wanted about 5-10 years ago soon. But honestly, who knows. We thought that would happen because interest rates and it blew up instead (TBH, likely lots of those Vancouver/Toronto people cashing out to come here because those interest rate burdens of several percentage points up in the first place). Maybe it will indeed cool down? I know some people that weren't happy with the pricing in the city already migrated outwards to the bedroom communities if they were lucky enough to get WFH heavy schedules and I don't really anticipate many of them suddenly deciding they need to rush back to Calgary city limits in large numbers.

What I'm also curious though is whether we will start seeing more multi-generational households in Calgary. I heard of very few in the last few decades and many were typically for reasons of doing it temporarily getting out of a rough financial situation. With zoning bylaw changes also changing rapidly, I could also potentially see support this shift of gentrifying single tenant properties with large square footage to multi tenant (rental/multi generational) occupation. The "mother in law suite" might actually start be predominantly lived in by mother in laws vs renters going forward.

But again, who knows?

[Winsor_Pilates]

Vancouver market has started this year on fire; not sure how it is in Calgary or other cites.
Will be interesting to see how this Spring goes, lots of active buyers in Vancouver and inventory is getting soaked up quickly.

Also on the real estate front, the Federal government extended the foreign buyer ban yesterday for 2 more years. Now goes through 2026.

[Twitchy15]

I’ve heard the Calgary market is still quite hot

[troutman]

Just talked to a friend in Port Moody. She has a condo near the Sky Train. The City wants to develop higher density and delivered a notice today - she could realize 600% on what she paid, if 80% of the owners accept.

[GoinAllTheWay]

Originally Posted by GoinAllTheWay

Yep...seeing that in my complex.


Units regularly going for $350k and one as high as $400k. A year ago I didn't see one go for more than $300k. Finally a good time to list a condo.

What a difference a year makes. Prices are as high as $500k in my complex now. Insane.

[chemgear]

We have net positive interprovincial movement and still massive volumes of immigration. Unless people start living 10 to a condo starting immediately, not sure how things improve/get worse (depending on your point of view) in the near to medium term.

[Calgary14]

Calgary house flipping has reached new levels: https://www.cbc.ca/news/canada/calga...data-1.7143857

[Mickey76]

Originally Posted by Vinny01

I have a condo in Sunnyside I bought back in 08 when i was 24 and have been renting it out since 2011. The condo fees have more than doubled and while I have a good tenant and just dropped my property manager it still costs more money than it brings in. I would love to dump it but I would take a massive hit on it. I really hope the condo boom continues. If I could sell if for what I paid for it I would move it tomorrow

I’m not trying to rub salt in the wound but this really surprises me. You’re saying a condo you bought in 08 is worth less than you paid for it? I don’t know the condo market at all but I just assumed everything would have at least doubled since then.

[Hemi-Cuda]

Originally Posted by Mickey76

I’m not trying to rub salt in the wound but this really surprises me. You’re saying a condo you bought in 08 is worth less than you paid for it? I don’t know the condo market at all but I just assumed everything would have at least doubled since then.

I'm guessing he bought right before the big crash in '08. I bought a condo in '06 for 280k. Prices cratered in '08 and it never recovered it's value. We finally sold the place in 2022 and managed to get 240k for it. Condos are not a good investment and I will never buy one again

[Nancy]

Originally Posted by Mickey76

I’m not trying to rub salt in the wound but this really surprises me. You’re saying a condo you bought in 08 is worth less than you paid for it? I don’t know the condo market at all but I just assumed everything would have at least doubled since then.

Condo prices only recovered to the 2007 peak as of last month, but adjusted for inflation, you would still be at a ~$100K economic loss.

[calgarygeologist]

Originally Posted by Hemi-Cuda

I'm guessing he bought right before the big crash in '08. I bought a condo in '06 for 280k. Prices cratered in '08 and it never recovered it's value. We finally sold the place in 2022 and managed to get 240k for it. Condos are not a good investment and I will never buy one again

I suspect that condo fees are really holding prices back as well. My mom bought a condo about 20 years ago in Marda Loop. It is a really nice place but it definitely increased as much as it should have. Obviously there is a lot of competition in Marda Loop but also her condo fees have gone up from just under $300 to over $550. This is a building with no amenities other than an indoor parkade. I think that $550 per month stings a lot of people when they see it.

[lazypucker]

The main reason condo value sucks is because Calgary is building so many of them, everywhere!! There is no need to build so many condos in ALL corners of the city, from Sage Hill to Cornerstone to Seton.

[accord1999]

Originally Posted by lazypucker

The main reason condo value sucks is because Calgary is building so many of them, everywhere!! There is no need to build so many condos in ALL corners of the city, from Sage Hill to Cornerstone to Seton.

They're probably needed to meet City requirements for unit density in new communities.