Could a red-hot summer for homebuying be on the way?
Edmonton’s real estate market saw little slowdown in the early months of 2024 – and April was the strongest sign yet that a sizzling spring and summer market is in the cards, with sales activity booming by 27.1% compared with the previous month.
On a year-over-year basis, sales jumped by an eyewatering 54.9%, according to the Realtors Association of Edmonton, as purchase activity across various property types skyrocketed.
Detached unit sales were 51.4% higher than April 2023. Semi-detached unit sales were up 61.7%. Row and townhouse unit sales surged by 46.4% while apartment condominium unit sales spiked by a stunning 72.5%.
All that points to a market whose stock continues to climb in the eyes of homebuyers, both Alberta-based and across the country as a whole. Despite the red-hot pace of sales activity, prices are witnessing more moderate increases, with total residential average prices up just 5.4% year over year and, at $431,387, well below averages in some of Canada’s least affordable cities.
Len Lane (pictured top), owner and mortgage broker at Brokers for Life (Dominion Lending Centres), told Canadian Mortgage Professional that out-of-province buyers had played a prominent role in Edmonton’s housing market in recent times.
“You can definitely see the number of licence plates showing up that are [in] different colours,” he said. “The lenders have been great, to tell you the truth. If they’re moving, doing the same thing they were doing in another part of the country, then they’re being a little bit lenient on what they’re accepting for income.
“The other part of that is that we’re getting a lot of calls out of different parts of the country to talk to us about buying rental properties as well. That’s another part of our market that’s probably going to explode a little bit.”
Supply challenges continue – but hopes rise for inventory increase
New residential listings also posted a welcome increase in April, rising by 11.2% compared to the previous month and by 13.7% over the same time last year.
Still, despite an overall month-over-month increase in inventory in the Greater Edmonton Area (GEA) in April, it remained well below 2023 levels – with 20.5% less supply on the market compared with 12 months prior.
Canada Mortgage and Housing Corporation (CMHC) suggests Canada has the capacity to build 3.87 million homes by 2031 but is falling short due to labor shortages and regulatory barriers.https://t.co/WwRpaxLjj7#housingmarket #housingcrisis
— Canadian Mortgage Professional Magazine (@CMPmagazine) May 17, 2024
Across all property types, residential listings sat on the market for just 36 days in April, down three days from March and eight days below April 2023.
The Realtors Association of Edmonton’s 2024 board chair Melanie Boles expressed hope that “steadily rising” prices would see a greater number of homes come to market in the city.
The province is aiming to boost inventory and accelerate construction through a new scheme to bring 2,000 skilled tradespeople to the province, with the so-called “Alberta is Calling” program offering a one-time refundable tax credit of $5,000 to construction workers who move to the province this year and file 2024 taxes in Alberta.
Find out Alberta's highest and lowest property tax rates here.
Strong market activity likely to stretch into coming years
Despite tight supply-demand conditions, there’s little sign that Edmonton’s housing market will slow anytime soon, according to Lane.
He said a resumption of the barnstorming COVID-19-era market was unlikely, but that buyers and sellers could expect elevated activity to persist well into the future.
“I think we’re at the start of a continuous climb here, probably for the next couple of years,” he said. “Things are changing that quickly and I think we’ll be back to maybe not our peak numbers in 2021, but definitely going into a strong market here for the next four or five years for sure.”
The last four months have seen Brokers for Life increase its number of agents by nearly 30% alone, Lane said, with the company continuing to scale upwards looking ahead.
“It’s a good market and a good time to be starting into the mortgage business,” he said. “Alberta is going to do quite well for the rest of the decade for sure, and into the next one. It’s always interesting to watch.
“You can feel it changing as you see the numbers increasing, the amount of credit bureaus pulled and things like that. It’s definitely going up quickly.”
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