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Data lens: Calgary housing more expensive, harder to obtain

As the housing affordability debate begins, we at LWC turned to the data to see where the challenges have been for Calgarians to purchase homes in the city.

Chief among the issues cited by both Calgarians and the City’s housing affordability task force has been the rising cost of housing.

Data from the Canada Mortgage and Housing Corporation demonstrates the swift rise in housing prices in Calgary, for all types of housing, in the past three years.

The median price of a detached or semi-detached home in the city rose from $545,000 in 2021 to $695,000 in July of 2023 (the last month that data is available from CMHC). This represented a nearly 28 per cent increase in the median purchase price of houses in that time period.

UCalgary economist Trevor Tombe said that rising home prices were only part of the affordability challenge that home buyers are facing.

“Average conventional mortgage rates have nearly doubled in the past two years, and are up nearly two percentage points since the summer of 2019,” he said.

“So even with 20 per cent down, the required monthly mortgage payment for a home in July 2023 is nearly 70 percent higher than what it would have been to purchase a median home two years earlier.”

Tombe cited the change as going from a 2.1 conventional rate to 3.55. Although, he said, those Statistics Canada measurements mortgage rates don’t include discounts that some mortgage holders can find—but are broadly representative.

Getting more granular with the data, the lower bounds of house prices in Calgary has also grown accordingly. Whereas in February of 2021, the lowest 20 per cent quintile of homes were priced at $405,000, that number rose to $570,000 in July of 2023—a 41 per cent increase which outpaced the overall median increase.

Tombe said that there is a high level of price dispersion throughout Calgary for home prices.

"Rising median home prices may also create significant pressure for many individuals to select homes further from the downtown core."

"If that's the case, then there are pressures not only on individuals when selecting their home, but also on City Council, which regularly struggles with the financial, environmental, and transportation capacity challenges that come with sprawl."

Looking at CMHC data from 2022 (matched to 2016 Statistics Canada census tract areas) for the unit absorption for single detached homes and semi-detached homes shows that the majority of those absorptions occurred in communities outside of the inner city.

Homes becoming harder to purchase

The ability for Calgarians to purchase homes is also affected by market conditions that affect individual professions.

Looking at the multiplier of weekly wages versus average home prices in Calgary, the rise in home prices has made it harder for Calgarians to purchase homes.

Alberta's aggregate weekly wage as a multiplier of the average home prices in February of 2021 saw it it would take 400 weeks of work, where the entirety of that wage was used, to pay for a the average home.

By July of 2023 that number rose to 541, or about a 35 per cent increase.

For the average oil and gas worker in Alberta, that value went from 173 in February 2021 to 257 in July 2023. For retail workers on the other end of the spectrum of wages, that multiplier went from 740 to 933.

Housing prices on the rise throughout price brackets

Visually, that rise in median price can be seen in the number of houses sold in price bracket data also provided by CMHC for Calgary.

The majority of sales of homes from 2016 through to the start of 2021 were between $400,000 and $700,000, with the highest number of sales typically occurring between $500,000 and $550,000.

By July of 2023, that bracket level data showed that the majority of house sales had jumped to between $550,000 and $950,000, with the most amount of sales that month occurring in between $650,000 and $700,000.