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Single-family homes in Edmonton remain relatively affordable – that’s good news for newbies and climbers alike

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Joel Schlesinger for the Calgary Herald Real estate |  Edmonton Journal Homes Photo by Ian Kucerak, file /Mail media

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The Edmonton resale property market is expected to see continued price growth in 2022, building on a strong 2021, a new report shows.

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Royal LePage recently released its forecast for 2022, stating that the Canadian resale market will grow more than 10 percent year-over-year to nearly $ 860,000, while Edmonton’s market is expected to grow by half.

All in all, the total price of a home in Edmonton is expected to rise five percent to about $ 451,000, the report said.

Although local owner and realtor Tom Shearer of real estate firm Royal LePage Noralta Real Estate falls short of the national average, he admits he initially thought the forecast was too optimistic.

“But looking at the market ahead of us and what I see now, I think that reduced inventory and selection will mean that … those price increases are likely in 2022.”

Demand for single-family homes will continue to drive the market, with the average price expected to rise six percent year-over-year to more than $ 500,000. In comparison, the average price for condominiums is projected to increase by about one percent to about $ 185,000.

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The low price of apartment buildings is one reason the city is attracting the attention of outside buyers, Shearer says.

“Brokers are getting calls from Vancouver and Ontario investors who could have a bigger impact on our market, while last year I don’t think they were a big factor,” said the former Edmonton Brokerage Chairman.

Additionally, the condominium market, which struggled the hardest during the multi-year slump that ended in 2020 in part due to the surge in demand triggered by the pandemic, appears to be in recovery mode.

“Anecdotally, we’re seeing condos that have been in the market for a long time and are not receiving any action are now starting to get out of the crisis while people are actually buying them,” Shearer says.

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In general, Edmonton is very affordable compared to other major centers like the Greater Toronto Area (GTA), which is forecast to have prices around 11 year-over-year to more than $ 1,375,000.

Even single-family homes in Edmonton remain very affordable, with only the Regina and Winnipeg market being more affordable, the study shows.

This is good news for newbies and climbers alike, says Nathan Mol, Edmonton real estate agent at Liv Real Estate.

“We’re the cheapest big city in Canada to work, live and grow,” he says.

He also notes that young Canadian professionals and families in British Columbia and Ontario are more interested in moving to the city to buy a home.

Shearer says rising borrowing costs, with the Bank of Canada expected to hike rates this year, could dampen demand and reduce the acceleration in prices that could result from reduced inventory levels.

The biggest risk, he adds, is what regulators like OSFI (Office of the Superintendent of Financial Institutions) could do to cool off overheated markets like the GTA. He points to previous actions such as the introduction of the stress test in 2018 that had a negative impact on the Edmonton market. However, the latest change to the test in June, which increased the qualifying mortgage rate from 4.79 percent to 5.25 percent, had little impact, Shearer says.

“We have really healthy momentum well into 2022 and so the market should keep chugging at a really nice pace.”

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