CANMORE – The largest residential home sale in Canmore shattered the previous record.
The home at 147 Cairns Landing went for $7.5 million earlier in April, going for roughly $959 per square foot for the six-bedroom home.
The previous record was last December when a four-bedroom home at 113 Spring Creek Lane went for $6.2 million. Before that, it was $5.5 million.
Devin Stephens, a Canmore-based realtor with MaxWell Capital Realty, said a key part of interest in the local real estate market is its proximity to Calgary and its international airport, outdoor events, and closeness to outdoor recreation opportunities.
“We’re seeing more improvements that are making Canmore more attractive to net-worth individuals,” Stephens, who sold the Cairns Landing home, said. “I think that transaction shows where the bigger money’s coming and it’s being relocated from typical markets like Whistler and lake markets and getting allocated to more of a unique dynamic like Canmore.”
Located in Three Sisters Mountain Village in Cairns on the Bow, the 0.22-hectare site was on the market for 90 days. Stephens said a similar type of property is often on the market for 250-300 days. He added it had two other offers before the final sale, highlighting buyers’ confidence in the price.
However, with inflation causing soaring costs for construction, he estimated if the home were built today it’d likely be in the $13 million range but $14-15 million in Whistler.
“In many cases, you couldn’t come close to rebuilding these properties for what the sale price is,” Stephens said. “There’s perceived upside for a lot of investors that are at that financial capacity. … It’s got lifestyle perks with amazing golf courses, incredible biking and skiing within a short distance. … If you compare it to Whistler, I think we’ve got something that will have more demand in the future than a Whistler market.”
Canmore has long been attractive for high-end homes due to its proximity to Calgary, the Rocky Mountains and national and provincial parks.
While Banff has a need-to-reside clause and Kananaskis Country has no large-scale residential properties, Canmore offers one of the few options for people wanting to live in the mountains.
Re/Max Canada’s annual cottage report had average sales price of homes in the first quarter of 2024 in Canmore at $1.04 million, an 8.1 per cent increase from the same time in 2023.
It forecasts a 10 per cent increase by the end of 2024 to hit $1.14 million in Canmore.
First quarter sale prices in 2024 for Whistler, B.C. was $1.75 million, Muskoka, Ont. was $1.41 million and Tofino, B.C. was $1 million.
Dan Sparks, a longtime Canmore realtor with Century 21, said there’s “Ever increasing pressure coming from outside of the greater Bow Valley, including Calgary,” particularly from the Toronto area.
He added buers will look at second homes, a home they’ll eventually make a primary residence or an investment property and compared to Whistler or the Muskoka’s, Canmore is significantly cheaper.
“You look at what your $4 million that sold in Toronto can buy you here. It’s hard to not think of that as a deal.”
‘I can’t see what calms this market down’
Several new developments will take place in the coming years with the Palliser Trail area structure plan (ASP), Lawrence Grassi Middle School area redevelopment plan (ARP), Three Sisters Village ASP and Smith Creek ASP.
The Silvertip ASP and Spring Creek Mountain Village ARP will also have construction ongoing, with the plans bringing largely market housing, but also affordable options to the community.
A proposed 239-unit residential development in TSMV’s The Gateway – which would’ve been the largest residential project this year – was put on hold for at least a month after Canmore’s planning commission asked Town staff and the developer to continue negotiating for more affordable housing.
Though many projects are moving forward, few are expected to finish this year, meaning supply will remain low.
“A lot of that inventory like Spring Creek and Three Sisters would be residential, but we’re still a ways from seeing any buildings being for sale in Three Sisters other than what may come up in The Gateway,” Stephens said. “I do foresee that we’re still going to be in a constrained inventory period for the next two years. I can’t see that changing.”
According to Canada Mortgage and Housing Corporation’s (CMHC) Starts and Completions Survey, there were 175 housing starts in Canmore in the first quarter, split between single-detached, semi-detached, row and apartment housing. The same survey had 244 throughout 2023.
Sparks, who served on the Canmore Community Housing (CCH) board for several years, noted since the COVID-19 pandemic, housing costs have risen dramatically. While a $3 million home used to be rare, it’s becoming commonplace.
“A $1 million home is almost non-existent … It’s almost always over a million now. Everything is going higher and higher and a lot of that is simply spillover from the rest of the country. Canmore’s a small market geographically and we have low inventory, no matter what we do, and a lot of people want to come here. That drives the prices up.”
Though supply often aids a market, in Canmore it’s typically short-lived to a matter of months before the new inventory sells and demand continues. He said when Canmore council defeated TSMV’s two ASPs in 2021, a perceived scarcity took place and prices increased within a month.
“Demand is outstripping supply and there is not enough supply coming on to balance the market as far as I can see.
“You’ve got a huge population in people, just in Alberta, who want access to the mountains, can’t buy in Banff and this is as close as you can get. You look at Whistler, this is extremely cheaper than Whistler. I can’t see what calms this market down.”
Canmore a ‘fractured market’
A major impact on Canmore’s housing market is the many types of clientele.
A single-family home in Silvertip or Cairns-on-the-Bow has distinct homebuyers and pricing compared to Cougar Creek, Larch or Grotto.
“Canmore is hard because it’s multiple, smaller markets. When you’re talking about $3.5 million half duplexes in Silvertip, that’s very different than someone buying a townhouse on Cougar Point Road,” Sparks said. “It’s a totally different socio-economic world coming from a different place and completely different needs and financing. They have no real relationship with one another. Talking about the Canmore market as a whole is really hard.”
He called Canmore a “fractured market,” but the main challenge is the average person getting into homeownership then potentially moving up. A person buying a $3.5 million duplex in Silvertip is typically not looking for financing and can outright buy the home.
CMHC’s Residential Mortgage Industry Report, released May 30, found more mortgage holders are facing increasing financial pressure, with low- to middle-class income homes using savings to cover basic costs.
It attributed 75 per cent of household debt to mortgages – with mortgage arrears anticipated to reach levels seen in the early days of the COVID-19 pandemic – and interest rates playing a key role.
“Under current interest rate conditions, more mortgage holders find themselves in precarious financial situations; the financial buffer they were able to build up during the pandemic has been exhausted,” stated the report.
Sparks said higher interest rates don’t impact a person buying a $3.5 million home, but cause more harm for entry-level buyers.
“All increased interest rates did was make a bunch of people, who otherwise could’ve been buyers, into renters, but didn’t do anything to dissuade people from buying more expensive houses in Canmore.”
From 2022-24, the highest sold home was an outlier and more than $1 million than the next closest price.
‘Canmore only seems to go up [in price]’
The 2024 federal budget outlined significant changes to the capital gains tax, stating it would net about $19 billion in revenue over the next five years and only impact about 40,000 Canadians or 0.13 per cent of the country’s population.
The government has said the average income for the 0.13 per cent is roughly $1.4 million a year.
Under 2024 federal budget, a corporation and trust will see its capital gains tax rise from 50 per cent to 66.67 per cent. A person with a capital gain of more than $250,000 will have it similarly rise from 50 to 66.67 per cent. Anything less than $250,000 will remain at 50 per cent.
If an asset or investment is sold higher than what a person paid for it, the difference is considered a capital gain. If a home is bought for $500,000 and sold for $1 million, a capital gain would be $500,000.
A capital gain, however, is taxable since it’s considered a form of income and ranges from property, mutual funds, business equipment and housing.
A sale of a primary residence isn’t impacted by a capital gains tax, but anyone selling a secondary property or home – whether it be a house, rental unit or cottage – more than $250,000 will face the capital gains tax.
Stephens said the Canmore market is intricately tied to capital gains, leaving local real estate more exposed due to secondary homes. With more details still to come, many people who may have to pay extra with capital gains are waiting for more information to be released due to the “substantial tax implications.”
“It’s a very sensitive market. Canmore only seems to go up [in price]. … We’re in what’s typically the busiest period, so there’s a definite impact of that news,” he said of the capital gains tax changes. “We’re connected at the hip with the capital gains rates.”
Sparks said some people may be incentivized to sell before federal policy changes begin June 25, but it’s not significant. He said he had a sale in May that would’ve been impacted and rather than face a $50,000 tax, it would’ve been $67,000.
He said the 2008 global financial crisis impacted the market for about a year, but it came back. The first few months of the COVID-19 pandemic also led to a decrease, but within months rebounded and surged with 2021 being his busiest year.
“2021 was the start of the migration of buyers coming from central Canada.”
From 2022-24, the highest sold home was an outlier and more than $1 million than the next closest price.
Canmore values continue to rise
The median assessed residential home in Canmore has only continued to go up, rising above $1 million for the first time this past year.
A single-family home hit $1.383 million, while a condo reached a median assessed value of $761,000.
In 2021, the median assessed residential home was $772,000 and then hit $800,000 in 2022. It jumped to $969,000 for 2023 before surpassing the million-dollar milestone at $1.043 million.
Median assessed value helps figure out property taxes, but doesn’t reflect the open market price.
Canmore is also working towards phasing out its tourist home designation as part of its housing action plan. Statistics Canada data shows eight per cent of Alberta homes as being non-owner occupied, but Canmore sits at 26 per cent.
Sparks said the phase out will have little if any impact on the real estate market, with people likely to pay the extra non-residential rate rather than bringing them into the residential fold.
“There will be people not happy they can’t sign the statutory declaration every year, but it was always supposed to be a temporary measure," he said.
“Tourist homes, in my opinion, were a failed experiment. They didn’t make sense from the beginning, so they’re simply clarifying what the market is already demonstrating, that they are for all intents of purposes, visitor accommodation units.”
‘Housing is a determinant of overall health’
CCH’s inventory has largely been stagnant since Hawk’s Bend added 49 units in 2019 and 10 units in Raven’s Ridge in Peaks of Grassi in 2021.
An 18-unit CCH project in Stewart Creek is underway, which will add about 50 bedrooms, and with the Palliser Trail ASP approved last year the initial steps for a four- and six-storey affordable housing project to add 144 rental units are moving forward.
The Palliser Trail ASP aims to add more than 1,000 non-market housing throughout full built-out of 10-20 years. However, without external funding, the Town will have to fund the bulk of it or consider financing options. Though it can quickly recoup expenditures with sales, they’ll push up against the Municipal Government Act’s debt limit, meaning projects will take piecemeal.
“It’s really important to get those projects up and running. The demand is there and we’re hoping to meet that,” said Rob Murray, chair of the CCH board. “Unfortunately, it does take time to build things and to build them properly. ... It’s important to get that on stream as soon as we can.”
Murray said demand has always been high for the affordable units, but has only increased in recent years.
CCH’s inventory for homeownership is 172, but demand is extremely high with 277 on the waitlist and minimal turnover. Its rental program has 118 rental units and a waitlist of 212.
“May, June, and July are months which have a greater number of lease renewals in our program, but we do not anticipate seeing any great change in occupancy given the gap between CCH and market lease rates,” stated CCH’s April operations report. “This lack of turnover is currently our biggest hurdle to significantly reduce waitlist numbers.”
A report released in May by the National Housing Council on The Financialization of Purpose-Built Rental Housing outlined the need to incentivize development of affordable housing, protect existing affordable rental properties, better protect tenants and create a non-market rental housing plan.
The report highlighted only four per cent of Canadian housing is non-market, meaning the majority is market and eligible as investments.
“Like access to health care, access to adequate housing is a determinant of overall health,” stated the report. “Implementing recommendations that align with human rights standards will result in a corresponding reduction in the number of people who rely on emergency health, housing, and social services and who experience homelessness.”
Under legislation, the federal housing minister has to respond to the report within 120 days then table a response to Parliament within 30 days.
Banff-Kananaskis MLA Sarah Elmeligi said demand is always going to be high for Canmore and Banff, with both councils prioritizing efforts to increase supply of market and non-market housing.
Though the communities are often transient, with workforces coming and going after a few months, she noted many people stay for years or the rest of their lives.
“Both the towns of Canmore and Banff are very focused on providing non-market housing in their housing developments and looking for models to combine non-market and market housing to make the numbers work. The non-market piece is critical. That’s the housing we need,” she said.
“We don’t have a lot of any of that in the Bow Valley. It’s really filling that gap in that whole spectrum from transitional housing all the way to non-market housing for young professionals to stay in the valley.”
The CCH board in 2022 approved increasing the threshold of who could apply for affordable housing to a gross household income of $250,000. The previous amount was $147,423. The intent was to open it to people who made too much money to be on the previous affordable list, but not enough to own market housing.
Unlike in the majority of communities across Canada, affordable housing takes on a different look in Canmore and area. As people in the middle-class are priced out of single-family homes, the only option to stay in Canmore becomes CCH and its non-market housing.
“We’re really building for a lot of middle-class people because that’s the unfortunate reality of Canmore is the middle-class is completely priced out of the market,” Murray said. “You want to buy even a small home for your family, it’s just not possible now and we’re seeing that exodus of people who are moving to Cochrane and making the commute or leaving the valley entirely and that’s really sad. We’re working very hard to try to keep as many local families living in this community as possible.”
According to its April operations report, market rental units in the first quarter of 2024 were averaging $2,555 for a one-bedroom unit, $3,476 for a two-bedroom and $4,478 for a three-bedroom.
CMHC’s Rental Market Survey for Canmore showed a 0.2 per cent vacancy rate in October, 2022, and 0.9 in October, 2023. However, it found the vacancy rate for a one-bedroom was zero per cent.
CMHC’s Rental Market Report, released in January, found Canada is experiencing the lowest national vacancy rate since the 1980s with it being 1.5 per cent and an increase of eight per cent for rents. The historical increase rent average is 2.8 per cent.
“Lower-income renters face the additional challenge of especially low supply and low vacancy rates for the most affordable units in Canada’s major markets,” stated the report.
While there are several proposed and plans to solve housing issues, Canmore's housing market remains a sought-after price.
“It’s so dynamic and it’s forever going to be in demand,” Stephens said.
MEDIAN CANMORE SALES PRICES
- 2019: $2.450 million
- 2020: $2.250 million
- 2021: $2.715 million
- 2022: 2.75 million
- 2023: 2.7 million
- 2024: 2.660 million (year-to-date)
NUMBER OF SALES AT $2 MILLION OR MORE
- 2019: Seven
- 2020: 10
- 2021: 29
- 2022: 28
- 2023: 20
- 2024: 11 (year-to-date)
HIGHEST SALE BY YEAR
- 2019: $3.9 million
- 2020: $3.931 million
- 2021: $3.8 million
- 2022: $5.25 million
- 2023: $6.2 million
- 2024: $7.5 million (year-to-date)
- From 2022-24, the highest sale is an outlier by more than $1 million compared to the next highest sale.
