Edmonton, Alberta is home to more than 1.5 million people and is a major Canadian city. For a first-time homebuyer, the home values and the prices of single-family homes in Edmonton make it an attractive real estate market.
The Edmonton housing market is considered by many Canadians to be one of the most affordable in the country. Out of the other major Canadian cities, Edmonton is much more affordable than other major cities like Toronto and Vancouver.
As the Canadian housing market has seen a slowdown in the last few months of 2022, it begs the question of whether Edmonton’s real estate market will also see a decrease in the average residential sale price.
To better understand the state of the housing market in Edmonton, let’s look back to 2022 and ahead to 2023.
Looking Back:
In the summer of 2021, the Canadian housing market experienced a major housing boom. This boom was caused by a huge demand from buyers which drove the asking and selling prices of homes up dramatically. This boom slowed down in the first half of 2022 and we have seen house prices drop since then.
In 2022, the greater Edmonton area has seen a decrease in sales prices for all types of homes. The average sold price for all property types was around $360,000 which was a 5% decrease from 2021. The average price of a condo was just over $200,000 and there was a 5% decrease in condo unit sales compared to last year. The single detached home sat at around $450,000. Along with lower prices, there were also fewer real estate transactions which resulted in a 26% decrease from 2021.
While 2021 and the first half of 2022 may have been a seller’s market, we are seeing less demand from buyers even though there is a solid inventory.
Looking Ahead
Many professionals are predicting the average prices of homes in Canada to continue to decrease in 2023. While they aren’t expected to fall dramatically, Edmonton is forecasted to have a balanced market throughout 2023., meaning that neither buyers nor sellers have the power. As well, the number of sales is expected to fall by about 2% throughout the year.
Realtors Association Edmonton chair Paul Gravelle spoke on the state of the market stating, “While we continue to see the Edmonton real estate market cooling down after a record-breaking period earlier this year, there is still a fair amount of activity happening.”
There should be more demand from potential buyers in the spring and first-time homebuyers or potential home buyers from other cities and provinces could decide to start buying in Edmonton. New construction projects will face upward pressure as supply chain issues continue to affect industries across Canada.
The Rising Interest Rates
The declining home sales in the Edmonton housing market can be attributed to a variety of factors, particularly the high-interest rates and the effects of inflation on the country. As of December 2022, the Bank of Canada currently has an interest rate sitting at 4.25% which is a much higher rate than March’s 0.25%.
This rate rises according to inflation rates and has effects on current homeowners and mortgage rates for many potential buyers. This rise in rates also means prices could continue their downward trend into 2023.
Canadian Real Estate Association (CREA) 2022 National Statistics
The CREA had a recent report released that looks at the national average housing price and other key indicators of the temperature of the market for that year or quarter.
Some Key Highlights:
The report outlines various pieces of data on Canada’s housing market, but here are the points that were highlighted:
- National home sales declined by 3.3% month over month in November 2022.
- The actual (not seasonally adjusted) monthly activity was 38.9% below November 2021.
- The MLS Home Price Index (HPI) had a 1.4 per cent drop month over month and decreased 4.4% year-over-year.
- The actual (not seasonally adjusted) national average sale price posted a 12% year-over-year decline in November
Overall, the last quarter of 2022 really saw a decrease in real estate transactions and home prices.
What Was The 2022 National Average Home Price In The Housing Market?
The report states, “The actual (not seasonally adjusted) national average home price was $632,802 in November 2022, down 12% from the same month last year.”
The CREA also has a price map that showcases the average property prices by province and territory Here are those prices:
- British Columbia: $904,020
- Alberta: $422,709
- Saskatchewan: $321,000
- Manitoba: $330,742
- Ontario: $829,934
- Quebec: $479,787
- New Brunswick: $269,800
- Newfoundland/Labrador: $280,200
- Nova Scotia: $368,600
- Prince Edward Island: $355,000
- Yukon: $498,567
- Northwest Territories: $392,255
Should I Purchase A Property In Edmonton?
Because the price of homes and condos are cheaper compared to big cities in other provinces, many home buyers are looking at Edmonton in order to afford a property. This could be beneficial to owners in Edmonton who are hoping to sell their houses as many people are used to having to pay Toronto prices. The rise in interest and mortgage rates continues to mean many people are unable to afford to buy a home in other big cities.
Whether you’re planning on buying or selling, it’s important to work with a real estate agent who can help you navigate the market and ensure you are finding a great property for you. As well, you should do your research and keep track of the market value in order to find the best deal.
Conclusion
Edmonton’s housing market is set to be balanced in 2023 and see a slight decline in prices. However, it’s predicted that out-of-town buyers will start looking at Edmonton because of the affordable house prices. With rising interest rates and higher mortgage payments, the Edmonton real estate market is one of the most affordable and attractive to buyers.
If you’re looking at purchasing a single-family house or condo in Edmonton, it’s important to look at the local market and keep up with trends in order to make the best financial decision.
Helana Mulder is one of REP/CREW magazine’s content writers and has been writing with them for a few months now. Helana’s interest in real estate writing began when her father started his real estate business over 15 years ago. After graduating from university with a degree in English Writing and Communications, Helana began writing content professionally. Outside of work, Helana enjoys listening to music, playing card games with friends, and reading the latest true crime novel.
