A huge shift in the market occurred in July with sales soaring to a record high number of transactions. There were 93 sales in Canmore and the surrounding hamlets in July 2020 a 116% increase month over month and a 58% increase over July 2019. This record number of sales was due to a number of factors: a pent up demand for sales that did not occur during the traditional spring market; a cultural shift where people are looking for more space or leaving other communities as they work from home; strong provincial and national tourist visitation resulting in revenues returning for short term rentals; and incredibly low interest rates.
During July, there was a new short term rental building launched and pre-sold at 115 Kananaskis Way which resulted in 18 MLS sales. Even accounting for these sales, it was an incredibly strong month. Month over month, detached and semi-detached home sales doubled to 32 transactions, townhouse sales jumped 162% to 21 transactions and short term rental properties jumped 222% to 29 sales. The only two segments that did not see an increase in sales were apartment condominiums and building lots. I suspect that apartments did not see an increase as many of our apartment properties are in the entry level segment of the market and many entry level buyers are still feeling the effects of the spring’s economic downturn. As well, those looking to work from home may want more space and / or outdoor space that many apartments do no offer. In terms of building lots, many buyers are looking for move in ready rather than waiting 18 to 24 months for their homes to be complete.
Overall, 2020 sales by the number of transactions are currently down 24% from the same time in 2019. This is incredible considering that April sales were down 80% year over year. Currently the market has shifted into a seller’s market overall. With the exception of the luxury segment of detached homes, the detached and semi-detached market is very much in seller’s market territory. Townhouse units have transitioned into a seller’s market as much of the inventory is being absorbed. Apartment condominiums are in a balanced market with six months of inventory. The short-term rental market of visitor accommodation and tourist home units is sitting in a balanced market as well. Pricing remains key as properties that are pushing the limits in terms of fair market value are sitting on the market and taking longer to sell.
While Canmore’s real estate market surges, it is a completely different story in Banff. Compared to Canmore and area’s 93 sales in July, Banff recorded four MLS sales. As Banff has a high number of private sales we typically expect a ratio of 50/50 to private vs MLS sales. This fraction of the volume of sales is the result of Banff being a one industry town and the hesitancy of buyers to make a move. Over the coming months, we do expect sales in Banff to pick up for two reasons: the return of tourism from the local and national market brining confidence to the town and a spill over from Canmore with buyers who work in Banff but currently live in Canmore. We also expect to see a continued increase in inventory in Banff as the rental market remains soft.
Moving into the coming fall market, we expect to see continued strong sales in Canmore and inventory levels remaining above 300 active listings.