According to a new study by market research and advisory firm Urban Analytics, stricter mortgage stress test rules along with rising interest rates have led to Edmonton’s multi-family home sales increasing by a mere 1% quarter-over-quarter in Q2 2018.
UA noted that the tighter policies have shaved off approximately 20% off the purchasing power of the market’s prospective home buyers.
The analysis also stated that the “lack of any significant project launches combined with a limited number of completed move-in ready units in the downtown core” was a major factor in the Q2 slowdown.
However, UA senior market analyst Annalise Boytinck assured that signs are pointing at improved sales numbers later this year as both buyers and developers “adapt their expectations for the new normal in Edmonton’s new multi-family home market.”
Sales of Edmonton’s wood frame condos declined by 7% quarter-over-quarter and by 19% from Q2 2017. Meanwhile, sales of concrete condos fell by 36% on a quarterly basis and by 42% annually.
Read more: Edmonton market’s housing inventory the largest in 10 years
These trends have boosted the popularity of townhouses priced under $350,000, Boytinck said.
“Townhomes are an appealing option for price-sensitive young family purchasers or downsizers seeking more living space than most condominiums offer. Townhomes were the strongest performing product in Edmonton in Q2-2018 with a 19% increase in sales. This was also the only sector to experience an increase in sales in Q2 compared to first quarter.”
Apartments, townhouses propel Edmonton residential market
Are you looking to invest in property? If you like, we can get one of our mortgage experts to tell you exactly how much you can afford to borrow, which is the best mortgage for you or how much they could save you right now if you have an existing mortgage. Click here to get help choosing the best mortgage rate