This is problematic for long term residents who are not currently in the market or who have been shell shocked with the rise in their monthly rent.

When I explain to people in person how hot the market is, nearly everyone says “that must be great for your business”. The answer is that it actually makes my business much harder!

A hot market is great as we break records with our sellers, but it’s two-fold. We also have buyers and it’s extremely tough to navigate this market. Hence why we always have a detailed plan specific to each client.

Long story short, I would rather a market that is more balanced that gives opportunity to BOTH the buyers and the sellers. Right now it’s super one-sided in favour of the sellers. Which is great for them, but at the end of the day the way that I see it is that there are humans on both sides of these transactions and it’s really tough for the buying side right now and I feel for them.

There is always more than enough real estate business to do in ANY TYPE OF MARKET. Therefore, I dream of a more balanced market where the pressure is more manageable. I miss those days! But for now it is full steam ahead and our team is getting all of our buyers into great homes every week!

I’ve also had many clients asking me lately, “why are there so many new communities and new homes popping up?” or “Who is going to buy all of these new homes?”

The answer is that yes we have an aggressive number of new home starts happening right now and for longtime residents it is mind boggling how many new communities are popping up.

Check this out:

The truth is that we actually need more NEW homes and more available housing in general to curb the housing crisis we are experiencing!

Here is something that may blow your mind!  Statistics Canada reported that within a 12 month span from July 2022 to July 2023, Alberta’s population grew by 4% in just one year. That is right, 4% in just one year folks!

This is nuts and for me this really puts it into perspective on what is happening with our population. We have too many people moving here and not enough homes. Sorry if I sound like a broken record on this but the data is just astounding and it continues to amaze me. AND it continues to strengthen our local home market and drive up home prices.

Due to these factors our market will continue to be stable with continued growth throughout 2024, there is absolutely no doubt in my mind about that. And for the analytical followers, the data and infographics below  this write up will support this opinion.

And heck, as a prediction, toss in a potential interest rate drop in the coming quarter and watch the market heat up even further. It would be just more fuel on an already raging fire.

Switching gears now into an industry topic –> Since covid we have experienced an aggressive amount of new licensed real agents entering the industry. I hear other industry colleagues often comment how annoying it is to work with these inexperienced agents, but that is just the WRONG ATTITUDE. 

Yes, many of them are not experienced and they may not be gaining the proper skills or training to be a professional agent. However, many of them will succeed, they will become skilled and it’s our job as industry leaders to show them the way. So I just wanted to throw that out there for anyone who has the wrong attitude towards any new industry professionals, no matter what industry you may work in. 

Furthermore, with more licensed real estate agents and a watered down quality of agents, the ol’ saying in the industry goes – 95% of real estate business is done by 5% of the agents. This still stands true in my opinion but it’s confusing for the consumer because there are many advertisements, social media posts and agent names out there etc. I don’t blame homeowners for being confused on who is the best fit for them. That being said, the top 5% will remain the top 5% with some of these new agents joining the top 5% in the future, which is great.

Highly skilled real estate professionals are just like lawyers or accountants, for example – the top echelon of professionals in any industry will always provide the highest value. They will be sought out by consumers and they’ll continually receive referrals because they do quality business (and have tools like Google reviews to support validity) and their clients value them.

I encourage all new agents (or anyone entering a professional services career) to become highly skilled and to become leaders in your industry. Skills are truly what sets you apart. It’s not marketing, it’s not social media, it’s not what brokerage or company you work with (these decisions are important, but it’s not the magic solution).

I believe that anyone’s success depends on the breadth of their skillset. Just like in any professional industry, the highly skilled will provide the most value and will win the most business.

Simply put, go be in the top 5% as a leader in your industry or you are leaving your career up to chance. 

Real estate is a tough industry and most people do not know that most real estate agents fail in the first 5 years (I often hear  that this number is around 85% failure rate in the first year alone). It’s a common misconception that it’s an easy job. Most licensed agents in our market average between 4-7 sales per year – which is impossible to live off of with the high costs and fees we incur. In my opinion the successful agents running a smooth business are selling 20+ homes a year and the leaders are 40-70+ per year. And they do it by having the high level of skills consumers are looking for.

No matter what industry you may currently work in, let’s champion new growth and new colleagues! There is always room for more professionals – especially as our population continues to boom as mentioned above!

February was a pretty crazy month for the Realty Aces as we had the opportunity to sell a large volume of real estate. CONGRATS to all of our clients who succeeded in a wild market and thank for trusting in us and our processes!

We broke records with sale prices with our marketing plan in many communities in general and also many condo complexes.This was all possible because of our strong support system referring us to buyers/ sellers and continuing to support us as the local real estate professionals of choice.

Without the support from all of you, none of this would be possible. We truly are running a referral and review business that requires your support.  THANK YOU!

Spring is here folks, not only with the market, but with the weather!  I’m beyond excited for spring weather, the outdoors and some BBQ cookouts!

I hope to see you out and about.

Cheers,

Your Local. Realty. Aces

I purposely wanted to wait a few weeks into January before sending this newsletter so I could watch how the market shapes up for the beginning of 2024 and to see if we can expect any major shifts in Q1.

And I say with absolute confidence that it will remain a seller’s market and we can expect home prices to rise in Q1 and probably Q2 of 2024. If you’ve been reading previous newsletters then you’re well aware of the housing shortage we are dealing with, or rather the “housing crisis” as I have previously named it in our local market. The demand of buyers FAR OUTWEIGHS the supply of homes available and furthermore, when you factor in our continued record breaking net migration to Alberta, you have the perfect storm to see prices rise in 2024.

How much can we expect prices to rise in 2024?

The honest answer is that I do not know and in fact, nobody does. It is pure speculation and if someone gives you a number and says it is a sure thing then they’re full of you know what. None of us have a crystal ball, however, what I can tell you is that when I see numbers like what you’ll see below with demand far outweighing our supply of homes, it is simple economics that we are going to see prices rise. There is no way to determine by how much because it truly depends on how many sellers list their homes in the next few months, and the supply level of properties we are then inherently dealt. IF we see enough properties listed then perhaps we can balance out the market by mid-2024, however, this is going to take a considerable amount of time and is likely a long shot.

Also, IF we see interest rates fall throughout 2024, then this will add fuel to demand by putting even MORE BUYERS back into the market.

Let’s switch it up this month….instead of ranting about how I have in previous months about topics such as migration, interest rates, the amount of buyers in the market and how prices are going to rise, I want to shift focus to why most real estate agents fail in the first year and why very few agents make it past the 5 year mark. Isn’t it crazy that no one talks about this?

Let’s talk about the influx of new agents who have entered the industry in the past few years and all the agent social media stars you see out there.

You may or may not know this but the truth about real estate agents is that the barrier to entry into the industry is very easy. What I mean by this is that the licensing process/ education component isn’t too costly, it doesn’t take too long to complete and the requirements to gain entry into the program are low, in my opinion. The Calgary Real Estate board which governs Realtors in Calgary, Airdrie, Cochrane and surrounding areas is a machine that pumps out new agents weekly. The real estate board is a business and their mandate is of course to make money, therefore, they are licensing new agents weekly and collecting fees despite most of the agents will not last long in the industry.

I tell you this not because they’re doing anything wrong but because it’s very confusing to the consumer on who to choose with so many choices. Also, it’s disheartening to watch all these hard working bright eyed new agents enter the industry, just to quickly fail and leave with a bad taste.

So how do you choose a professional real estate agent with so many agent options?

It’s simple, choose someone who has skills. Do not choose someone based on social media or their perceived image – dig deeper than just that and find an agent who instead of marketing themselves has instead focused on educating themselves to be a leader in the industry. 

It doesn’t matter if they’re a new agent or a veteran agent, choose someone who truly understands the market, they understand data, they know how to market a listing properly,  the have killer instincts when assisting buyers, they have processes, technology, they’re highly motivated, they possess strategies that suit your needs and they’re honest!

I always tell my clients that I believe 95% of the business in our industry is done by 5% of agents. So find someone in the 5% because they’re going to provide the smoothest process and best results. And to be clear, any new agent can get into that 5% in the first 1-2 years in the industry, if they focus on their skills. I did and I am not a genius and I watch others do it all the time.

A buyer or seller is going to hire someone (or should) based on their skillset. We are talking about major assets (sometimes people’s largest investment/ nest egg) so why leave it to someone who isn’t skilled? Would you give your investments to a financial advisor who isn’t skilled? Why would this be different?

The agents who have had (or who are going to have) a LONG successful career are the agents who are skilled, honest, transparent, high integrity and they truly care about helping out their clients.

I always tell my clients that I am not sales driven, or driven by commission. Of course this is how I get paid but instead of counting the pay cheques I focus on how I can help as many families as possible with the highest level of skills and in return the organic referrals and reviews I will receive will create an influx of business.

Like any business, a referral business is the best route to longevity and much easier to run to have a healthy balance sheet to run a tight business.

I am not a social media star and nor do I care to become one (I actually really treasure my privacy which is incredibly hard to do as a Realtor), and I do not judge any other industry member who is a social media star, everyone can run their business however they like and I respect that.  I will continue building my business based on skills, results, reviews and referrals and I hope that other colleagues will do the same.

Lastly, I want to give credit to a colleague named Ted who has had an incredible career in real estate. When I entered the industry years ago I hired Ted as a coach and he taught me that skills pay the bills. There is no secret marketing trick, it’s simply having the highest level of skills possible. He taught me how to become more skilled than my competition and in return I rose to the top naturally because consumers want skills. So Ted, thanks buddy!

I hope everyone is off to a great start in 2024. Obviously this weather is brutal right now but in true Alberta fashion it will be completely different by next week. Stay warm everyone and please reach out anytime with your real estate questions.

Cheers,

Justin & Your Local Realty Aces

How long will this boom last? 

Rising interest rates will make a larger impact by cooling our market but it is unlikely to be a major impact until late 2023 or early 2024. Especially as many buyers have lower interest rates locked in for 1-2 more months and they’re hungry to BUY NOW (and likely can’t afford the rental market right now).

As mentioned in the past, it’s all about supply and demand – we have significantly more Buyers (demand) than we do Sellers (supply) across all market segments and home types. Until this can level out we are experiencing a home crisis as we truly do not have enough homes for everyone right now. Builders can’t build homes fast enough, sellers won’t sell until they’re confident on how they will buy back into the market and then we have thousands of people migrating here looking for homes as well = the perfect storm.

Honourable mention goes to townhouse sales which are absolutely wild right now. I recently listed a townhouse that had 60 showings in 2.5 days and many offers. It sold 20% above list price and the most recent comparable sale in that complex was $55,000 lower! The townhouse market in Calgary, Airdrie and Cochrane has experienced a major gain in prices over the past 45 days and will likely continue the surge in August.

I’ve had many people ask me recently whether this market is sustainable and my answer is no, this is not sustainable long term. 

I do not think the market will stay this hot and I believe that our market is cyclical and prone to the classic “Boom & Bust” economic cycle. However, I do think that these current prices are here to stay in 2023 and likely to remain stable (at minimum) in 2024 unless interest rates in 2024 can make enough of an impact to slow down buyers and out of province migration to Alberta. There will be a bust, however I do not see that bust happening in 2023.

Listing a property in this market and ensuring that you get top dollar requires a rock solid process and a strategy that can be executed well. Every property needs a unique strategy to ensure we get as many buyers as possible in the door, to in return get you the strongest offer. No corners can be cut and I really mean it. Sure the market is the best we’ve ever seen but that also means that you have an opportunity to get the best value for your home and we are loving this opportunity to help our sellers out by ensuring they seize the opportunity! I shake my head when I see a listing come online that is poorly executed and I am not shocked that it receives an average sale price. Getting an average sale price is easy, but right now it’s about getting the best price and being ABOVE AVERAGE! This data then changes the market by pushing up the benchmark price, so you want to be above average right now if you want to beat the market. 

As mentioned in the past few newsletters, BUYERS NEED A PLAN. This means being focused on a specific market, being pre-approved and ready to view homes ASAP and ALSO write offers before the market changes and swallows you up. Yes, it’s a ton of pressure but the only way to beat the other 10 buyers out of your dream property is to be more prepared. We’ve had many smooth buyer transactions over the past month and have also had to lick our wounds a few times when we lost in multiple offers situations – but we always come back stronger. Buyers need to be resilient right now to find the right opportunity because the right property does exist (or will soon), therefore having a strategic plan on how to obtain it is absolutely critical.

July was one of our personal best July’s ever, for the amount of clients we were able to help out. We were very busy selling and buying properties and we are incredibly thankful to the many clients who supported us and trusted in our process! We may be a bit tired and we may have a few new battle scars but we are still as motivated as ever! Especially because as mentioned above, this market will not last forever so we are loving the opportunity to navigate it and to help so many people out.

It looks to be another hot August weather wise and also real estate wise – we are looking forward to it! Have an awesome August everyone and please reach out anytime to chat.

Cheers,
Justin

Last month we saw Calgary detached home prices hit a benchmark high and now Airdrie & Cochrane detached homes have both also hit an all time benchmark high. Simply put – this is a historical market.

The entire market is hot right now but the hottest tickets in town are townhomes and apartments, simply because they’re the most affordable housing segment. With rising interest rates (including another 0.25% hike today by the Bank of Canada) buyers are flocking to get into these lower priced homes while they can. The result of this is a home segment that is experiencing surging prices as buyers compete for them.

As a buyer in today’s market if you’re searching for a home under $500,000 you need to be prepared to be in multiple offers (and above $500,000 too, just not as much) – if the listing is priced correctly it will almost certainly have multiple buyers bidding on it. I’ve seen as many as 25 offers on a listing over the past month, it’s absolutely wild stuff happening right now.

Sure, home prices are at a record high and the market is continuing to exceed expectations, but why is this still happening and how long will it last?

The hottest topic in town right now is Interest Rates. While the feds try to cool down inflation by hiking interest rates it’s fuelling the lower priced homes and it will eventually cool down the market, in theory. However, I predict that the prices of these homes will rise significantly before the impact of the interest rates take effect. And in a short period of time too, I am talking about in the next few months! Buyers and sellers need to strike now while the iron is hot.

I predict that the rise in interest rates, including the most recent one, will fuel buyers to get into the market while they can before they’re priced out of the market. And if you haven’t heard, the rental market is absurd right now, it’s not fun trying to find a rental, especially with the rise in rents we’ve had in the past year.

Inherently all of this is going to make the next 1-2 months surely a chaotic frenzy. Eventually as pre approval interest rate holds with lenders expire (see chart below for a breakdown of the impact on a mortgage) the buyers fate will be that they now need to rent and wait for a more appropriate time to enter the market which will cool the market. And the price points we land at once we hit the peak market will be higher than they are today, even in just a short period of 1-2 months from now.

Then will it all come crashing down?

No, it’s unlikely that the market will crash because we simply have too much pent up demand and our migration is still at record levels. We have a housing crisis on our hands, there are not enough homes available for sale or for rent in our market. Until we have a larger supply of homes this is what we can expect.

Therefore, I predict that the market will stabilize in the last quarter of 2023, likely will be a flat market and 2024 remains to be seen. But what I am confident in is that our market is going to have one more small surge across all price and home types and then it will likely stabilize in 2023 as the weather cools and the snow flies. Making it another record year.

For sellers this an incredibly opportune time to be selling property but it needs to be done right. It doesn’t matter what price point you are at, you can’t cut corners if you expect top dollar – this means having a strategy in place to market the home to its fullest potential, timing the day of the week and specific week that you list the property on the market based on competition etc and then having a strategic plan in place on how to get the most buyers into the property and have them subsequently write offers to drive up the price and create a historical sale. We have quite a few listings coming up in the next 3 weeks and we are very excited to exceed expectations!

This is prime time for our 2023 real estate market, however, you need to take the right steps and that’s what we are all about. After all, strategy is nothing without execution.

For buyers, I feel your pain. Trust me, it’s not fun as an agent to know that the home you want may not be attainable at current prices and interest rates. That being said, we are still managing to find all of our buyers awesome properties. Hard work always pays off, especially for buyers competing on properties with multiple offers. This is where having a realistic plan is critical, we need to be quick and be ready when the correct opportunity presents itself.

Our team has had a great past few months with many happy clients and nearly all of them came to us from referrals from past clients. This is what fuels us to get up every day and kick ass. So thank you all for the continued support and for thinking of us.

To recap, July is already off to a hot start with the market showing no immediate signs of cooling and we expect it to be an awesome month for all of our clients. It’s likely that we’ll see a slower fall season market so we’re excited to keep the good times rolling with you as we continue to navigate this historical market.

If you haven’t had the opportunity to enjoy some Stampede festivities then make sure you get out and enjoy some much deserved fun. We personally love the rodeo, if you haven’t been yet then you should try to make it out.

Enjoy the sunshine and have an amazing July everyone!

Cheers,

Justin

Our real estate market prices have officially climbed back to the peak and we are now flirting with breaking new records on many different home types. There has been a ton of “fear” and “doom and gloom” around us since mid 2022 when interest rate hikes began and although we had a slight correction in the second half of 2022, we are now another trip around the sun and we are back to 2022 peak prices. AND likely to surpass them this month.

Close your eyes and imagine one of the hottest real estate markets EVER….. and then open your eyes back up and there it is. We are living it.

We are not going to see a real estate market crash in our local market in 2023 unless a major global event (like Covid for example) happens again. There is simply too much demand  for a home and not enough homes for people to live in, both for purchase and also for rent. It’s actually a crisis in my opinion, we need more homes and we currently have a home crisis! There is a shortage of homes, it’s going to take many months and into 2024 at the earliest before we can likely provide these homes.

Although the volume of homes sold is significantly down in 2023 vs 2022, this is not an accurate indicator of the health of the market because IF there were more homes on the market and more sellers in a position to sell their properties, then they all would’ve sold and increased that volume. However, many sellers (and I don’t blame them), are on the sidelines waiting for the right timing or opportunity before pulling the trigger on selling their property.

You need to have a game plan as a seller, more than ever! Because you can’t just sell your home and easily buy another if the home you want doesn’t exist! This is where working with an experienced and high integrity real estate professional is critical, so they will tell you the truth and reality of the given market and what truly is a viable plan to secure your new home.

Maybe I sound like a broken record if you’ve been following my newsletter – there are not enough homes for buyers to purchase! We are incredibly short in the supply of homes and the demand far surpasses what we have available on the market.

This is driving up prices but prices are not skyrocketing at an accelerated pace because we need more homes to sell first, which will create sold data, which will push up prices. Because as we all know a home is only worth what someone is willing to pay for it and the sold data needs to exist to give buyers confidence to purchase at those prices and to show them that the market is on a definite upswing.

Apartment sales are leading the way in Calgary, Airdrie and Cochrane. Many of the listings we are seeing have been rental properties for the last 5-10 years because sellers couldn’t get the price they needed to make it worthwhile to sell, but now they can! Now is the time for these sellers/landlords to cash in. I have my finger on the pulse and am watching very closely as this market continues to sizzle and it will be interesting to see how apartment prices are influenced in summer 2023 or whether we have hit the top for them already.

My Prediction= There is still room for apartment prices to grow this summer! There is simply too much demand and not enough supply of apartments to purchase.

The name of the game is affordability! Basically anything under $575,000 is selling very quickly and likely selling in multiple offers. It’s simple, with rising interest rates and also a very unaffordable and competitive rental market, buyers are competing for homes – inherently driving up prices and also rents.

Also I will mention, homes priced above $575,000 are also selling like hot cakes, just on a lesser scale.

If the rental market was as soft as it was a few years ago we would likely be experiencing a different real estate market today. However, with rentals being scarce and tough to find at affordable rents, it is continually pushing many renters into the market to purchase and they are purchasing while they can before interest rates jump even further. It’s a Catch-22!

We just had an interest rate hike of 0.25% this week and there is rumour of another coming as soon as July. It’s a mad dash! Especially for families who are looking to secure their next home this summer before school begins again in Sept. Whether it be home ownership or the rental market both options are fiercely competitive so you need to have your game plan set and look to be executing it NOW! 

There is no perfect statistic for how competitive the market is right now but on most of our listings we are still experiencing multiple offers which tells a clear story.

I am telling buyers that for every home that we view and that they like, we are likely competing with 5-10 other buyers in the same situation, if it’s priced right. Therefore, it’s incredibly important to have your finances sorted out and to be prepared to write the most strategic offer in order to give yourself a chance at success. The other option for these buyers is the rental market, which is much more costly in the long run from a financial perspective, in my opinion.

May was an awesome month for our team as we helped many buyers and sellers navigate an incredibly complicated market and we expect similar conditions as we enter the summer months. It certainly is challenging but we are up to the challenge and it is why we are here, to help you succeed with your real estate goals. So don’t be shy, if you need help or if you simply have some questions then take advantage of us. We are always happy to chat.

Thanks as always to our incredible support system of past/current clients, friends and family. None of this would be possible without you :) We are now approaching 100 Google Reviews which I am sincerely grateful for all of you who have taken the time to tell the world about us. This is hands down one of the most important ways to support us, so thank you!

Maybe the most important message of all is – Get outside, enjoy this weather, bbq some great food, drinks some delicious drinks and spend time with family and friends because that is truly what this time of year is about!

Hope to see you around.

Cheers,
Justin

With some listings getting 20+ offers on them right now I think it’s safe to say that the spring market frenzy is in full effect, buckle up folks!

Not to sound like a broken record, but as I have been saying for the past few months – there are not enough properties on the market to meet buyer demand right now. With the lack of home supply we are now seeing crazy bidding wars on some properties (similar to spring 2022) and it’s causing a rise in prices across the board. Apartments and townhouses are leading the way because they’re the most affordable options for buyers who are dealing with higher interest rates.

Existing homeowners are reluctant to list their home unless they have a plan in place for where they’re going to be moving next. And I don’t blame them for sitting tight until they have that figured out. I have met with dozens of sellers over the past month and nearly all of them are working on the plan of “where they’re going to go next”  before we list and sell their home. Needless to say, this is a very tricky market because you can likely get a peak price for your property this spring but if you don’t have somewhere new to move to, then you’re not really getting ahead. And the rental market is insane right now, therefore selling and then paying high rents until you find something new isn’t appealing to most sellers either.

So how do we sell your house and get you in a new one?

We need a custom strategy specific to you – we need to find you the right option or options first so you’re comfortable to list and sell your property for top dollar without fear of where you’re going next. We have been doing this with many of our clients and although it’s not the traditional method of selling first and buying second, with now buying before selling and matching up the closing dates, we have managed to make sure risks are mitigated and our clients successfully achieve their goals with a smooth as butter process.

Although this 2023 market has shades of similarity to 2022, it is very much a different market. New markets create new challenges, new risk and require new strategies and new solutions.

The main challenge has been centred around supply. As a result, existing homeowners may be reluctant to list as they struggle to find an acceptable housing alternative in this market. At the same time, higher lending rates can also reduce the incentives for existing homeowners to list their home.

Sellers–> So the market is hot – must be easy to sell a property right?

No – A hot market means that yes we can sell your property BUT we still need to take all of the right steps if you expect top dollar. This means proper preparation of the property, pricing it right, marketing it like a boss and having a strategy on how to manage showings and offers in order to maximize opportunity to the seller.

Buyers–> So the market is hot – is it too hard to find/buy a property right now?

No – Buying a property just requires a strategy to ensure we can get into homes as quickly as possible to have a chance to compete for them. This may mean that my partner Damien is helping with showings to ensure we don’t miss out on any property in a very fast paced marketplace. Or this may mean that we are making sure we understand the market better than the competition so we are making strategic offers, especially in a bidding war situation (that you’re likely to be in if you’re buying a property right now).

Overall, we are going to have a frenzy in our market with some rising prices until either a major global event or major political event happens OR sellers decide to capitalize on high prices and a sufficient influx of properties hit the market at the same time to curb buyer demand and curb the bidding wars.

A special thanks to all of our supporters. We have been fortunate to live our dream of being real estate professionals year after year because each of you.

Spring is here so get outside, get some fresh air and enjoy some sun :)

Cheers,

Justin

January 2023 Market Update

Hi Friends,

Happy New Year!

Alright, let’s jump right to it – IGNORE THE NATIONAL NEWS HEADLINES when it comes to real estate in Alberta. Measuring Canada as a whole and thinking that it applies directly to Airdrie, Calgary, Cochrane or the surrounding area markets is absurd and the headlines are simply not applicable to us. For example – I have been speaking with contacts in Ontario and many sellers have lost a quarter million in the past 6 months on their home values, yes $250,000 in 6 months. Their markets have experienced hyper growth for many years, whilst ours have not. Therefore they have way more room to deflate than we do even though 2022 saw record-high sales and double-digit price growth in our market.

That also means that our homes, quality of life and our affordable home prices compared to the rest of Canada, is still very appealing. I realize that I probably sound like a broken record regarding to the net migration we are experiencing but it’s real data, and data is what helps us make informed decisions.

Check this out:

“Alberta’s population jumped by 119,000 since the first quarter of 2022 and 135,190 since the fourth quarter of 2021, according to Statistics Canada’s third-quarter population estimates released Wednesday morning. Alberta’s population has increased by 1.3 per cent in the past three months, the highest rate in the country — an increase of 58,203 people.” -Calgary Herald Dec 21, 2022

Now that is a local headline that catches my attention and it is based on facts by Statistics Canada. As many of you know, basing decisions on data is how I operate. I am not saying to trust the local media outlets for real estate decisions, (definitely talk to us first as we’re the boots on the ground), however, almost daily I am meeting people who ask if our market is crashing like other parts of the country. The answer is NO – at least for the first quarter of 2023. It is impossible to perfectly predict the market outside of the first quarter of 2023 (in my opinion), because there are some major influences that will be hitting our local market this spring:

• Provincial Election in May –>  I do not care what colour of politics you bleed, each party will have pro’s and con’s to our real estate market and overall quality of life.  I’ll stay apolitical on this and let you decide for yourself, but do know that the election results will have a major impact on our province and the stability of our real estate market.

• Recession –> This is a scary term to most so let’s break it down a bit further.  Alberta certainly is not recession proof, however, our home prices are not inflated like other areas of the country and a recession typically hammers the over inflated markets more than others. Our energy focused economy is firing on all cylinders right now – I understand that this makes our economy volatile without a breadth of diversification, so our economy reliance on Oil & Gas is not a sustainable long term plan. However, I believe Migration offsets the risk of Oil & Gas prices falling, not to mention that Oil & Gas prices are projected to remain strong in 2023, likely even rising.

• Migration –> Our homes are affordable to Canadians, Refugees and Immigrants, whilst offering a quality of life that is arguably one of the best in Canada. As mentioned above Statistics Canada is predicting that net migration to Alberta will continue to be strong in 2023. To me it’s simple, more people coming to live here means more need and competition for homes. Inherently resulting in stable or rising home prices.

• Interest Rates –> I am no interest rate expert so let’s be clear that this is not me saying to buy or not to buy with current rates, that is your decision to make with your trusted mortgage advisor. Yes, interest rates are likely to remain high for 2023, let’s not expect them to come down anytime soon. That being said, the demand for homes in our market is still well above historical levels, even at these current rates and I believe that buyers need to transact in all types of markets because everyone needs shelter. Coupled with net migration trending upwards, buyers are figuring out ways to still get into the market and they will continue to do so.

Lastly, as mentioned in my market reports this fall, affordability is the name of the game. The more affordable housing segments have plenty of buyer demand and they will continue to outperform the higher priced properties. Especially as more people immigrate to Alberta looking for affordable housing.

Obviously there are other influences that will affect our local real estate market but these are the ones that I believe will have the largest influence in the first quarter of 2023. As mentioned above, I do not see the market crashing in Q1 of 2023. We will experience stable prices, at minimum and unless we see an aggressive amount of sellers list homes all at once, we will continue to have a shortage of homes on the market.

The market will not be as wild as the record breaking levels in the first half of 2022 but it’ll be busy for home sales and the numbers should be above historical averages. With net migration continuing to trend, along with the pent up demand of sellers/buyers waiting for spring to list/buy, it’s going to be a strong market going into spring. All it would take is one of the influences bolded above to change significantly and the market would react but I personally do not think the start of 2023 will have an influence strong enough to cripple our market. I do not have a crystal ball, what happens going into summer is still too hard to predict but I do expect the next 3 months to be a strong and stable market without a collapse.

2022 was a dynamite year for the JW Realty Team because of our loyal supporters, you folks truly are the best! We’ve been awarded the Top Producing Team in all of Alberta at Grassroots Realty Group and our clients, friends & family are to thank for our continued success & milestones. Our approach to business is to deliver a service that is superior to the average agent & in return we are naturally awarded with positive reviews (check them out on Google!) & referrals from past clients. THIS IS WHERE 90% OF OUR BUSINESS COMES FROM, PAST CLIENTS! Referrals from past clients are the backbone to our business, there is no magic formula to being successful in real estate other than just doing a great job & we love it that way!

Thanks as always for the continued support and for reading this market update. If you’d like to discuss further or if you have any questions please feel free to shoot me an email or give me a call, I am always happy to discuss and debate.

Have an amazing 2023!

Cheers,

Justin

December 2022 Market Update

Hi Friends,

2022 has been a record year for our real estate market. Net migration to Alberta is the highest it’s been since 2014. To put it into perspective, in the second quarter of 2022, net migration into Alberta was 34,883 people, compared to 1,049 in the same quarter of 2021, an increase of 3225.4%, holy cow! (Pretty cool graphs here if you’re a data nerd like me –> https://economicdashboard.alberta.ca/NetMigration)

To me this paints the picture of what has happened with our market in Calgary, Airdrie, Cochrane and surrounding areas – the rest of the country is coming to Alberta and it’s completely lit our market on fire this year. And even though much of the country is experiencing a market contraction, our market has weathered the storm much better so far. With net migration expected to continue to be strong in 2023, this may be what steers the ship.

Two other topics I would like to touch on this month are interest rates and a provincial election in May 2023 that will impact our real estate market.

Let’s start with interest rates. We are expecting the Bank of Canada to announce another small rate hike tomorrow (Dec 7) and then it’s possible that we see more in 2023. However, many experts are predicting that this may be the last rate hike (I sure hope that they’re right, time will tell). With the current interest rate floating between 5.25 to 6+% (each buyer qualifies differently, please talk to your mortgage broker to confirm what rate you qualify for) we are still seeing homes sell very quickly.

In fact, a few weeks ago I had a listing that received 5 offers and sold for $20k over list price, in just 24 hours on the market. Therefore, our market is alive and strong even with these higher interest rates.

There is no doubt that the higher interest rates have pushed some buyers back into the rental market, but for buyers their choices are simple, they either buy at the current interest rate or they rent. The rental market and rents in general have increased significantly in 2022 and for many buyers they may feel more security in owning and building equity long term versus paying these high rents with no equity later. I don’t see rents coming back down near as quickly as they have gone up, therefore, I predict that we will continue to see renters looking to purchase, especially as rental leases expire each month and landlords then try to raise rents with a new lease, to try and match a more current market rate.

In May 2023 we have a provincial election coming that will have a major impact on the future of our real estate market short and long term. I do not care what colour of politics you bleed, each party will have pro’s and con’s to our real estate market and overall quality of life. When you go to vote in May, please ensure that you do your research and if you are as invested into real estate myself, then I think you’ll find a clear answer for how each parties economic platform may impact our market. How much this weighs on your decision is of course up to you. Again, I’ll stay apolitical on this, just know that this may cause concern in the market depending on the election results and a market shift in Q3 and Q4 of 2023. Something for us to keep an eye on.

The supply of homes on the market is lower than it was last year at this time. AND we all know what happened in January of this year when we still had a low supply of homes and buyer demand went bananas. I am certainly not predicting an exact repeat in Q1 of 2023 that we experienced in 2022, however, I do think that simple economics and the law of supply and demand will hold true in 2023. If we do not experience a significant increase in the supply of properties on the market in early 2023, then we will have a very strong start to 2023, as net migration is expected to continue on an upward rise.

It’s simple – people are moving here, they need homes and we do not have enough homes right now! 

We’ve been very fortunate to have another wonderful year of helping many clients with their real estate needs. We’ve stayed consistent and once again have sold over $30 million in real estate. We’ve also grown our family, made many new friends and overall just had a kick ass year! THANK YOU to each of you that read this update every month and thanks for the continued support.

Have an awesome holiday season everyone!

Cheers,

Justin

Migration to Alberta is going gangbusters and we have seen the largest wave of interprovincial migration since 2014. Let’s put it into perspective, in the last 12 months 23,132 people have moved to Alberta from other provinces! On top of that, Alberta and particularly Calgary, Airdrie, Cochrane and the surrounding area is an incredible place to live with amazingly diverse communities AND our housing is much more affordable than most other provinces, which inherently gives Canadians migrating to Alberta a much better quality of life. The Alberta Advantage is alive and well.

So what is selling?

Simply put, affordability is the name of the game right now! Buyer demand has eased in our market, however, the more affordable options are still performing extremely well. This includes townhomes and apartments but also well priced detached homes or detached homes under $600,000. Homes $500,000 and below are selling like wildfire due to a lack of supply in the market.

The market has cooled since it peaked mid-year, but many market segments are holding steady as new price points were set. Amongst our 3 major markets, Calgary, Airdrie and Cochrane, all 3 of these markets are either balanced (essentially meaning that buyer demand is being met by seller demand) or there are segments still in a sellers market (meaning there are more buyers than sellers).

With that all being said I do not think our market is going to crash in these last months of 2022. I do think that it’ll continue to balance out and we may see some more minor price declines month to month of 1-2% is many segments. The major caveat to everything is interest rates and inflation. If the feds continue to use interest rates to battle inflation then theoretically over time it will cool the market and we can’t ignore simple economics. I just don’t think it’ll be a quick and ugly crash like our provincial neighbours are in for.

As for the market in 2023, it’s still too early to give a honest answer as there are just too many moving parts that will influence our market. Recession, interest rates, oil and gas, migration etc. Nobody could’ve perfectly predicted the insane growth our market has had in 2022 back in Oct of 2021.

Fall is here & we are incredibly thankful for our clients & their continued support. Almost all of our business is coming from past client referrals or Google Reviews that our past clients graciously created for us…. so THANK YOU to all of our supporters as you are solely the reason that we can do what we love and love what we do. Have an amazing fall everyone

Cheers,
Justin

To recap – we kicked off 2022 with an exceptionally large influx of out of province buyers entering our market, combined with an already low supply of homes and low interest rates this boost lit our market on absolute fire. We have seen gains in ALL property types across our market and not small gains, we are talking about some hyper growth gains.

But, what is going to happen next?

With interest rates reaching a 31-year high, this is a GAME CHANGER. Interest rates have shot up quicker than most of us had expected, including myself. Looking back to earlier in the year I predicted that interest rates would reach this point, however, I did not think that we would see it until late fall or winter.

There is no need to hit the panic button and here is why. We still have a unique market to the rest of Canada, we have room to grow as we are still affordable to the rest of the country. Whereas much of the country has had years and years of major gains, while we sat back since basically 2015 until 2021.  I still believe that we have more room to grow – it just won’t be in 2022.

This does not mean we are “recession proof” or that we will not see declines in home prices this fall. In fact we are already seeing some home prices balance out and slightly decline. For Example: This spring you could expect to sell your home over list price, however the strategy now is listing your home precisely at market value and being ecstatic about getting list price. I predict by Sept that most sellers will be happy to get within 1-2% of their desired list price and that August will see the market drop by 1-2%.

The market will likely trend towards declining home prices for the remainder of 2022. This will not offset the massive gains we recorded in the first 6 months of the year. So although home prices are going to slip in the coming months, they’ll still remain significantly higher than in 2021.

To put it into perspective, the benchmark price of detached homes in 2022 in Calgary is up nearly 20%, Airdrie is leading the way at over 23% and Cochrane is nearly 19%. 

These benchmark home price gains WILL DROP for the remainder of 2022. But they won’t drop by more then 1-2% a month.

So if you’re a buyer, you’re going to see some better home prices in the coming months, HOWEVER, your interest rates are going to stink so you’re truly not going to save much, if anything, by waiting.

If you’re looking to sell a property. Well it’s simple, you’re going to get more for your home today than you will in Sept forward.

We’ve been blessed with an amazing following of supporters and we could not do this without you. Over the past month 100% of our business was referred to us by past clients. AMAZING! THANK YOU THANK YOU!

August is going to be a scorcher, get outside and enjoy the weather while it’s sizzling hot.

Cheers!

Justin

June was an incredibly strong month for our real estate market and although most of the public felt that is “was slow”, that is just because we had all become used to the frenzy that Jan to May was, which was the most intense real estate market and volume produced during that time period this decade -just to put it into perspective. Therefore, we are now moving along at a pace that I personally feel like is closer to what we had for most of 2021, which is still an incredibly strong and competitive market.

That being said, the longer we have these high interest rates, the more the market will cool as buying power is significantly reduced. This also means that higher priced homes will begin to bleed the most as consumers are pushed towards more affordable options, inherently giving a spike in demand to those lower priced homes.

In my opinion, anything under $600,000 will continue to be a strong market until at least the fall. And the lower the price of the home, the stronger the market will be. It’s simple, this is all that many of the buyers will be approved to buy with higher interest rates.

As mentioned last month, there has been a large transition of out of province buyers leaving our market as their local markets are now on a decline, which has many thinking that we may be next. If history repeats itself in Alberta then we will certainly follow a “boom & bust” trend. However, this time around it will be different because our housing is still WAY MORE AFFORDABLE then other top Canadian cities. Even if we see our market shift this fall, the bleeding will be a fraction of what markets like Vancouver and Toronto will see because we are still affordable, even with higher interest rates. Logically speaking, if you can’t afford to buy a home in those other markets, doesn’t it make sense to consider Alberta? Let’s face it, this is a great place to live with excellent benefits from just being an Albertan – the rest of the country is noticing.

On another note, Airdrie continues to lead the way with a stronger Seller’s Market compared to Cochrane or Calgary. There is still just a complete lack of inventory to match the demand from buyers. It’ll be interesting to watch this over the few months as we likely move into a more balance market.

As a reminder, July is typically a bit of a slower month for real estate because kids are out school and families simply have other plans and ideas on their mind. Also it’s summer and we all want to enjoy it. This doesn’t mean real estate sleeps, it never ends but we will likely see a bit of a slower month now that the sun is out and I then expect a stronger August/ September, before what I am expecting to be a slower fall for the market, especially if interest rates remain high. If interest rates ease by fall then we’ll have a strong finish to 2022.

What a spring we had and THANKS to all of our incredible clients it was a ton of fun. As always, you are the reason we love what we do and do what we love.

Get outside and enjoy Canadian Summer, it’s the best!

Cheers,

Justin