The reason all the real estate markets in Canada went a bit crazy was because two events happened simultaneously. First, we had a pandemic. Many potential sellers chose not to sell their homes
because they didn’t want people bringing the coronavirus into their environment which caused low inventory. The lowering of inventory occurred when interest rates were at their lowest ever levels making borrowing money cheaper, thus increasing the demand in the market.
When you have low supply and high demand, prices are pushed up as buyers compete for the limited number of properties.
Experts were a bit mystified about why Calgary’s real estate market was so strong. Other Canadian cities like Vancouver and Toronto have immigration and migration of citizens looking for jobs in diverse labour economies to support the demand for homes. Calgary’s current economic prospects are not as strong, so the reason for the run-on real estate was the low cost of borrowing, a desire to be isolating and working in a bigger home, and the housing market’s low inventory. As a result, Calgary didn’t see the increase in prices as early as the other cities and the market is cooling down sooner.
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