The future of Calgary’s Real Estate Market (the meat and potatoes).

The future of Calgary’s Real Estate Market (the meat and potatoes). 

If you are like me, you like to push all the fluff to the side & get straight to the point.  Although the statistical nerd in me also likes to dive into stats which can be a long and winding road taking forever to get to your destination.  So in an effort to save you loads of time, I’m going to venture to extract from the many forecasts and stats I’ve read and offer you a bulleted list of deets which will give you good insight into where our Calgary Real Estate Market is heading in the next few years.  At the end I’ll include the various sources.

Here we go:

Covid and the Real Estate Market

→ Reductions in employment were evident before Covid.

             20K jobs lost in Feb
             40K jobs lost in March
             Immediate impact was very significant
             Professional & scientific sectors reflected the oil industry in job loses

→ Sales in April dropped 63% compared to April of 2019
             Listings also dropped at the same time which helped curtail over-inflated inventories
             Months of supply did push up to 10 months

             Benchmark price declined by 1.56% in April compared to April of 2019

→ Sales in May dropped 43% compared to May of 2019
             Listings also dropped 29%
             Months of supply retracted back to 5.4 months
             Benchmark price declined by 2.67% in May compared to May of 2019

→ Differentials seen btw average and median points out variances of impact in different sectors although the        benchmark is better when looking at the over-all market and long-term trends.
→ Most sales are occurring in lower price ranges
→ Higher price range absorption rates have increased substantially
→ Far steeper price declines in the higher range rather than the lower ranges
→ Deepest recession in AB history expected
→ RBC states Canada economy will retract by 8% and AB will have the greatest impact due to Covid & Energy
→ We still haven’t recovered from the 2015 recession.  Argh!

How does this compare to past recessions?

→ 80s:
             High interest rates
             Another recession happened in 1986 due to decline in oil prices
             Decreased migration levels due to job losses
             50K jobs lost with a provincial population of about 2 million
             1981 to 1985 average price dropped 22% with a slow decline of 3% in the first year with gradual increases per year. 

             Prices didn’t recover until 1989

             NOTE:  price decline trends take time to get traction and tend to take a long time to recover. 

→ 2008 Financial crisis:
             Huge impact but strong / quick rebound
             Decreased migration levels but far lower than the 80’s
             28K jobs lost so unemployment rates not as high as the 80s
             Prices declined btw 2007 and 2009 by 4.6% prices recovered in 2012. 

→ 2015:

             37K jobs lost with unemployment rates up over 8%
             The jobs replaced were not in the energy sector.  Most in the government, education, healthcare sectors
             Prices declined from 2014 to 2019 by 5.8% and still have not recovered. 

Now and moving forward:

→ Some of the programs that the Government put in place will help moving forward
→ This recession will take much longer to recover than past recessions
→ Bank of Canada has responded with Prime Lending Rate of 0.25%
→ Migration levels should be relatively stable in 2020 with some rebound in 2021.  Most migration is international, not inter-provincial.
→ 250K job losses expected with unemployment rates highest in recorded history
→ Job growth will rise in 2021 but unemployment rates in 2021 expected to be in the double digits
→ This recession is expected to persist for several years due to a delayed recovery in the energy sector.
→ Sales activity in the 2nd quarter expected to drop by 50%  but pick up in the 3rd quarter
→ As social distancing measures ease, this drop will level off but will still remain low
→ Price declines expected in 2020 by 3% Benchmark price city wide with higher drops in the higher price ranges.
→ Further price declines expected in 2021.


→ Prices expected to remain low for several years
→ Western Canadian Select prices are in negative territory for several months
→ WTI will likely not recover for the next 2 years or more.
→ As Social distancing measures ease, demand for oil will increase
→ Storage is full so it will take time to absorb current supplies
→ Energy job losses will persist
→ Federal Government financial programs are not focused to assist the energy sector
→ Energy reflects 42% of our GDP and 25% of our work force
→ GDP is expected to drop 6% in 2020
→ 9% drop in employment in the energy sector
→ All other sectors of GDP expect to see declines with the exception of healthcare and education
→ Employment decline of 6% with no improvement until 2022. 


→ Energy sector will cont. to struggle
→ 2nd wave of Covid?
→ How many companies will survive?
→ If jobs do not return in 2021, mortgage defaults will increase putting downward pressure on prices due to low precedents set within each sector. 
→ Can large companies like airlines survive through this?  If so, inflation may occur due to limited competition

Good news:

→ Government programs to ease the pain ie deferred mortgage payments (for now)
→ Potentially lower mortgage rates
→ Real Estate has been and will continue to be an essential service.
→ Governments (internationally) are willing to take on whatever debt is necessary to get through this difficult time. 
→ New Home Builders have not scaled back (yet) on starts.  Covid will ultimately affect their starts due to downward pressure on prices.  If not, there will be an over-supply for new homes which will ultimately lower prices. 
→ Mortgage Rates remain low.  Although the relationship between the Bank of Canada rate and Mortgage rates is not cohesive.  Mortgage rates may not see decreases that correlate with the BOC rate. 

What to pay attention to moving forward?

→ The first indicators of a recovering economy are:– Employment Market, Job numbers & Unemployment Rates. 
→ Easement on the financial stress-test for buyers to stimulate affordability – If the markets in Vancouver and TO begin to recover, then likely no change to the current stress test parameters.  Unfortunately, TO and Vancouver markets are not as impacted as the AB markets.  The Bank of Canada wants to ensure the Banks have enough liquidity.
→ The Political environment:  Ottawa doesn’t have a lot of interest in boosting the energy sector in AB & not a lot of international investment into AB for energy as well.  As far as diversification, there is nothing on the horizon to replace the 30% of AB’s GDP in energy.  Pending on the US’s response to international energy market, the US may engage in importing Canadian oil South to the US at significantly discounted rates rather than the US introducing US oil to the international markets causing international tension. 
→ US election:  If the Democrats get elected, any oil moving South will come to a hault. 

Figures 7 to 12 below indicate that the outlooks for housing indicators in Alberta and Saskatchewan are more heavily weighted to the downside compared with other provinces with no anticipated recoveries to current levels until sometime in 2023. For the complete CMHC report click here

Those of you who know me know that I tend to be overly optimistic and try to see the silver lining in all circumstances.  Although I want to be more optimistic about the next 2 years of Calgary’s / Alberta’s Real Estate Market.  With the facts / insights given above from people much smarter than me, it would be misleading of me to be overly optimistic at this point.  Times are tough at the moment, and it doesn’t appear to be getting better any time soon.  But, Albertans are resilient and we always find a way to not just survive, but thrive by our strong work ethic, entrepreneurial spirit and determination! 


Given that we’re in 2020, our vision for the future is far from perfect.  With that said, we need to make the best decisions we can based upon our current circumstances and the factual information we have before us. There are so many variables that will affect the best time for our clients to either buy or sell.  Each of you have entirely different circumstances that need to be taken into consideration separately.  For consultation specific to your circumstances, give us a call, we are always happy to chat with you!

At RealPros we view part of our role as educators; providing our clients with excellent information to help them make good educated decisions.  

I trust the above information gives you a good insight into Calgary's market. If you have any questions, please don't hesitate to contact us anytime. 

Keith Braun
RealPros Real Estate Consultants

Purpose Realty
Office: 403-547-1222

Toll Free: 1-855-547-1222

Sources:  Calgary Real Estate Board - Canadian Mortgage & Housing – Canadian Real Estate Associations – Alberta Treasury Branch – Calgary Herald – Mortgage Sand Box

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