A Calgary realtor expects more challenges ahead for the housing market in 2023 as it recovers from interest rate hikes that have spooked both buyers and sellers alike.
“We’re hoping by the end of 2023, it’s going to change and it’s going to change probably pretty radically,” said Christopher Audette, realtor and founder of The Group at RE/MAX First.
However, right now, he said many home buyers are struggling to find good, affordable options, including his clients Amber Dorais and Kyle Medicraft.
The couple has spent the last month looking for their first home together just outside of Calgary.
“We’re looking as dual-income and we’re having a harder time finding things within our price range,” Dorais said.
The pair is being transferred to the area for work and are hoping to buy a place in either Langdon or Strathmore.
The biggest challenge they’re facing is a lack of listings.
“We’re not the only people looking right now and when something good does come on the market, it often disappears decently quickly,” Dorais said.
Interest rate hikes are further complicating things for them.
The Bank of Canada implemented seven interest rate hikes in 2022 alone, taking its key interest rate from 0.25 per cent in February to 4.25 per cent in December.
The central bank has another announcement scheduled for Jan. 25. While it was suggested it might be ready to press pause on interest rate hikes, further increases have yet to be ruled out entirely.
Dorais said that the prospect is concerning, but the options for rentals are also slim.
“We kind of feel like we’re stuck between a rock and a hard place,” she said.
“We don’t want to end up poor houses, so we are, with potentially higher interest rates coming and the high interest rates that we currently have, we are looking at decreasing our budget a little bit in comparison to what we were looking at , say a year ago.”
Audette said the interest rate hikes have caused housing sales to plummet in the city and across Canada.
While it still won’t be what it was in early 2022, Audette predicts 2023 will still very much be a seller’s market.
“With these low, low, record low inventory levels that we’re seeing right now, it’s a good time to list,” he said.
“Trying to beat out a couple more of these interest rates increases, too, is not necessarily a bad thing. You have less buyers who are able to purchase at your price point as the interest rate comes up.”
Audette expects inventory levels to remain low this year as the demand for housing in Calgary and Alberta continues to rise.
He said that could also come with modest price increases.
“We are a little bit of an island in the storm. We’ve got a lot of people moving here. We’ve got a big tech sector, oil and gas. We’re just a desirable city to move to right now and a lot of people in the rest of the country are seeing that.”
Audette recommends that people looking to buy a home in 2023 consult their mortgage broker first to figure out the best financial strategy.
He also encourages people to constantly look at new listings and be prepared to act quickly.
“If something does come up that looks good and it looks like it’s priced right compared to the other things, jump on it. Don’t wait,” he said.
“Having said that, don’t be rash in your decisions. have a plan b.”
As for Dorais and Medicraft, they’re doing everything they can to find a home by mid-February.
“You gotta be a little more open-minded to, you know, fixer-upper versus a new build show home,” Medicraft said.
Dorais added, “We’ve had to have lots of conversations on what are musts, what are needs, what are wants, what are dislikes but not deal breakers and what kind of work we’d be willing to put into a place.”