Elevated lending rates are expected to drag on the real estate market in Okotoks and elsewhere in the region this year after a brisk 2022, but sales are still forecast to be higher than activity reported before the pandemic.
“Higher commodity prices, recent job growth, record high migration and relative affordability are expected to help offset some of the impacts higher lending rates are having on housing demand,” said Ann-Marie Lurie, the Calgary Real Estate Board’s chief economist.
Lurie prepared the recently released 2023 Forecast Calgary and Region Yearly Outlook Report that provides a detailed analysis of housing market trends in Calgary and surrounding areas for the coming year.
According to the report, the year has begun with low supply levels which are expected to prevent significant price declines. Supply levels declined to the lowest levels seen in over a decade as gains in higher price properties did not offset the supply declines occurring in lower-priced homes.
“This has left our market in a situation where lower-priced properties still face sellers’ market conditions while higher-priced homes are seeing more balanced to buyers' market conditions,” Lurie said.
Limited supply compared to demand persisted in the Okotoks market throughout most of 2022 as overall supply remained exceptionally low relative to historical levels.
According to the report, shifts to a more balanced market will be dependent on supply adjustments.
There has been an improvement in new home starts activity, which should help with the supply, but much of the gains have been for multi-family properties. The tighter conditions will likely prevent a significant adjustment in price in 2023.
Blair Gordon, owner of Century 21 Foothills, said all indications are that it’s going to be a slower market this year, but he added that Alberta’s economy will continue to be strong.
“As properties come up for sale, they’re selling so it seems like there are buyers around,” Gordon said. “The interest rates haven’t scared everyone away.”
He said lower inventory means prices are holding.
Gordon said Alberta, particularly the southern part of the province, continues to be attractive to buyers.
“Our prices are lower than just about anywhere else,” he said. “Alberta is a go-to place; we’re attracting people from other provinces to move here.”
There were 843 sales in Okotoks in 2022, up almost two per cent from a year earlier. There were 999 new listings last year, eight per cent more than in 2021, while the benchmark price increased to $542,908, up more than 15 per cent from $469,425 to end 2021.
