As we step into the new year, the Calgary real estate market reflects a combination of stability and ongoing challenges shaped by both supply and demand dynamics. December’s sales figures, though slightly down from 2023, demonstrate a market that continues to outpace long-term trends, thanks to significant gains in higher-priced homes.
A Year in Review: 2024 Market Summary
In December 2024, Calgary recorded 1,322 home sales, a 2.9% decline year-over-year. While this marks a slight dip compared to 2023, it is still a notable 20% higher than the long-term historical average for December. This figure underscores how Calgary’s market has remained relatively strong despite some underlying challenges.
Over the course of 2024, total sales came in just shy of 2023's levels. Higher-priced homes saw a notable uptick in activity, while the lower end of the market experienced some pullback due to ongoing supply challenges. According to Ann-Marie Lurie, Chief Economist at CREB®, the gains in the upper price tiers helped to offset the softness in the more affordable segments. A key factor behind this was the ongoing population growth in Calgary, which continues to fuel overall demand.
However, the real limitation in 2024 was the scarcity of inventory, particularly in the lower price ranges. “Sales would likely have been higher if there was more supply choice, especially in the lower price ranges,” Lurie explains. While the market remained strong, the lack of available homes, especially in affordable segments, created a bottleneck, keeping overall sales from surpassing the previous year’s performance.
Improved Supply, Stabilizing Prices in the Second Half
One positive trend in 2024 was the gradual improvement in housing supply, particularly in the second half of the year. Inventory levels increased due to a boost in new listings in both the resale and new home markets. As of December 2024, Calgary had 2,989 available units, marking a significant improvement over the tight conditions seen in early 2024 and at the same time in 2023. While still below long-term trends, this increase in supply helped alleviate some of the pressure on home prices.
This improvement in inventory, combined with more rental choices and a surge in new home activity, played a critical role in stabilizing the market. After the steep price increases seen in the spring, home prices plateaued during the latter half of the year. Despite this stabilization, the overall residential benchmark price saw an annual increase of more than 7%. While price growth slowed in the latter part of 2024, it was still a year of notable appreciation.
The Road Ahead: What to Expect in 2025
As we head into 2025, the overarching theme for Calgary’s real estate market will remain the supply side of the equation. The dynamics of inventory will continue to shape price trends and sales activity, especially as we see more homes being added to the market.
However, the critical question for 2025 is the type of supply entering the market and how demand will respond in the face of a shifting economic landscape. Economic factors such as interest rates, inflation, and broader market conditions will have a direct impact on homebuyer behavior and demand levels.
It is important to note that while more supply has helped alleviate some of the pressure on prices, it has not fully solved the challenges in the more affordable housing segments. If the demand for lower-priced homes remains strong, and if inventory in these price ranges does not sufficiently rise to meet that demand, we could see upward pressure on prices for homes in the affordable categories.
CREB®’s upcoming forecast report, set for release on January 21, will offer further insights into the expectations for Calgary’s real estate market in 2025. It will outline potential risks, including economic factors and supply-demand imbalances, while providing a closer look at the market’s future trajectory.
Conclusion: A Market in Transition
The Calgary real estate market in 2024 was marked by resilience despite ongoing supply issues. With higher sales in more expensive categories helping to offset slowdowns in the lower price points, the market showed its ability to adapt. Moving into 2025, the market’s performance will largely hinge on the pace and type of new supply, alongside broader economic conditions that will shape demand.
For homebuyers and sellers in Calgary, the coming months promise a balanced but cautious market, with inventory levels and price movements largely determined by external economic factors and how well the supply side keeps up with demand.
