[Solved] When Is The Best Time To Buy a House in Calgary?
The Best and Worst Time To Buy a House in Calgary
Timing can be everything in real estate. Determining when is the best time to buy a house in Calgary can have a large impact on the number of homes you have to choose from, the price you get the home for, and how easy it will be to move on at that time. Homebuyers in Calgary are focused on finding the right property but the value will also play into their decisions. If you are thinking of buying a house in Calgary, this guide will help you determine the best time of year to start looking for a new house. Also, if you are planning on selling your house, you will learn the best time to put your home on the Calgary market.
Factors To Consider When Buying in Calgary
When you are determining the best time to buy a house in Calgary, there are a few factors to keep in mind as you start the process.
- New Listings: As a buyer, you will want options to choose from when you are searching for your next house. The last thing you want to do when you are dealing with a purchase this size is settle on a place. It’s one thing when you go to your favourite restaurant and you have to settle for your second favourite item on the menu, but when it is a house, it is a different story.
- Sales: Knowing when the most number of sales occur will put you in a position of power. You will have an advantage when negotiating as you will have a general understanding of the seasonality behind the market conditions in Calgary.
- Inventory: Having a handle on inventory levels in your community will provide you with one of the best indicators of when you want to buy. This is because inventory is a function of both listings and sales. New listings might be high but if sales are equally as high, buying at that time may lead to one losing out on properties, but if inventory levels are high, this tells us that sales could be on the lower side in comparison to new listings.
- Prices: When will I get the best price on a home? Well, this is property dependent, however, with the power of real estate market trends and data, we can draw some powerful conclusions as to when sellers will likely take lower prices. Again, this will depend greatly on the house and the seller, but having the insider scoop never hurts.
- Seasons: We can’t discount the importance of our Calgary weather. When it comes to the best season to buy a house, there are some clear distinctions and time frames to choose from. This also hinges on when a seller is interested in packing their bags and moving to their next home.
- Personal Timing: This relates to if you have a home to sell first or if you are in a lease that dictates the time frame you need to be in your future home. We will not put as much weight on these items in these guide as they are subjective. However, if you have flexibility on when you sell or if you are in a month to month rental, this information will be extremely valuable.
Buying a House Based on New Listings
Choosing when to buy a house will be very dependent on the number of homes you have to choose from. If having the most number of options is important to you, then you will want to tailor your home search to a time when there are the most number of listings. Let’s look at the data
This graph shows a typical year in Calgary and the number of new listings that buyer will have to choose from. When looking at this, one can see that the “Spring Market” in real estate is a real thing! If you are looking for the greatest number of options in the Calgary market, then you would be wise to look between April-June.
Pro Tip: If you are a prudent buyer, you may wish to start your search in March. That way you will become familiar with the market and you can confidently purchase a property of interest in the spring months.
This information is very important to those buyers that consider themselves “picky buyers.” These are the buyers that have a hard time finding what they are looking for on the market. If this is you, then an ideal time to start shopping is in the early spring as the number of new listings in the spring is almost 3x the number of new listings in December.
Now, it’s important to know that just the number of new listings is not enough data for us to make a firm conclusion that spring is the best time to buy.
Buying Based on Number of Sales
Looking at the number of new listings is great for determining the options that you have, but what happens if all your options sell before you have a chance to look at them? This can mean you are left with the properties that the other buyers were not interested in. This doesn’t necessarily mean there is something wrong with the home, it can just be the pricing wasn’t yet aligned with what the market is willing to pay or the marketing could use a boost.
When you focus your search on the number of sales in a given month in Calgary, you may be more inclined to select a month with fewer sales. If this is the approach for you, then you could be more focused trying to land the best deal or receive the highest amount of the asking price.
Based on this information, December through January may be looking like your best option. There are less than half the number of sales in these months versus the spring months. Logically, this makes sense as moving in the dead of winter isn’t the easiest process in Calgary.
This can also reflect overall activity in the Calgary real estate market. Although this isn’t always the case, if there are fewer sales, it’s likely there are fewer showings. If the seller is receiving fewer showings, there could be more motivation to reduce the price or sell for a lower amount. Again, this isn’t a sure thing as every seller has a different level of motivation and all properties are unique, but this is some additional information you can use when searching for your next house.
Buying Based on Inventory Levels
Inventory levels are one of the most powerful ways to determine when you would like to buy. That is because inventory levels are a function of both new listings and sales. It’s one thing if you are just focused on the number of new listings, but if these are all selling then you can be in a tricky spot. Furthermore, if you just focus on a time when sales are the slowest, you could also not be maximizing the number of options on the market.
Here are the data for both the number of new listings and the number of sales in a given month.
This is where your buying strategy will become interesting. If you are looking to buy in the spring, your sales are higher but your new listings far outpace your number of sales. However, if you are looking to buy in the winter when sales are slowest, your number of new listings are just slightly above your number of sales.
Looking at the spread between sales in the spring in Calgary and the winter in Calgary, spring still seems to win out based on the number of options you have.
On the other side of the coin, if you are selling in the spring you will need to be mindful of the other listings. Since the number of new listings far outpaces the sales, pricing too high could be a mistake. Whereas, in the winter the spread between sales and listings is less.
Taking this one step further, let’s look at the number of expired listings. Expired listings are lowest in February through March presumably because this is when sellers are starting the listing process. In December, there are the greatest number of expired listings.
To add one more piece of information to buying based on inventory levels, we also need to look at the months of inventory. This is calculated by looking at home may sales there are in one month based on the number of listings currently on the market. This is then broken into how many months it would take to sell all the current inventory.
For example, there are 20 homes on the market and 5 homes sell in one month. Therefore, there are 4 months of inventory (it will take 4 months to sell the remaining homes at the same pace)
Here is a look at the months of inventory in a given year in Calgary. The trend shows that the months of inventory stays quite high as we move through the winter months and dips in the spring months. Also, there can be a slight dip in the fall known in Calgary as the “fall market.”
Buying a House Based on Prices
This is usually at the forefront of the buyer’s minds. They want to know when is the best time to buy a house in Calgary in order to get the best deal. I mean, who doesn’t want a great deal on their house? And as a seller, when can I expect the highest price on my home?
Like most things in real estate, the answer depends, but we can look at the datum to see if there are any conclusions we can draw on this front.
This is the graph that always excites clients. This shows the sale price to list price ratio, or the percentage off the asking price that, on average, sellers took. For example, if a home was listed for $100,000 and sold for $97,000, the sold price to list price ratio would be 97%.
How interesting is this trend? In March, on average, sellers are accepting 97.5% of their list price whereas in December they are accepting 96.5% of their asking price. This is a 1% difference between the times of the year. If we are looking at a standard $500,000 house in Calgary, this is a $5,000 swing in, presumably, what the seller will accept.
As mentioned, this is the trend but this doesn’t mean that it will work this way with every transaction. A well-priced property in December should still sell very close to the asking price and an overpriced property in March will still sell at a discount. Another important point is these are averages. One sale in December that sells for 90% of the ask can really pull down the average.
Regardless, these are trends we see in the Calgary real estate market. This means that if you are a tough negotiator and you want the most possible off the asking price, November and December are the times to get this.
Pro Tip: List price and market value are independent values. The list price should be in line with the market value but this just a number that a seller chooses to put on their property. As a home buyer and seller, focus less on the list price and focus almost exclusively on the market value to make sure you are landing in a proper range.
Buying Based on the Season in Calgary
It’s no surprise that the seasons play into both buying and selling in Calgary. Packing your boxes and moving in the dead of winter can be a challenge. This is reflected in the trends.
Why does a seller take a lower price in November and December than they do in March? Probably because they don’t want to deal with having their home on the market throughout the winter, or they are worried that they will not see an offer until the next spring. This is not the case, but psychology does play into the residential real estate transaction.
Pro Tip: When choosing your closing date, avoid the last week of June. This is the busiest time for Calgary real estate lawyers and land title transfers.
As is highlighted in the new listing, sales, inventory, and sale price trends, the market will be slower in the winter months. If you are hiring movers, REALTORs, lawyers, inspectors, etc, chances are they will be busier in the spring months as this is the time when the most transactions occur.
When Is The Best Time to Buy a House in Calgary?
The best time to buy a house in Calgary is April, May, and June if you want the most number of options but would still like a reasonable amount of the asking price. If you are looking for the largest discount off the asking price, you will want to purchase in November or December.
When Is The Worst Time to Buy a House in Calgary?
Based on the data, February and March may be a less appealing time to buy a house in Calgary as the sellers are usually less negotiable and all the spring market options have not been listed yet.
Important: There is no right or wrong time to buy a house in Calgary and there are perks and drawbacks to all seasons. In most cases, the best time to buy a house depends on your personal circumstances, the property you are interested in, and your motivation.
Determining when is the best time to buy a house in Calgary is an important part of the buying process. When deciding when to buy a house, it’s important to look at new listings, sales, inventory, prices, seasons, and your personal circumstances. If you are looking for the largest discount, you may be focusing on buying in the winter months. However, if you want the most number of options, you may focus on the spring months.