Edmonton home prices to remain flat this year but will take off soon

Apr 27 2023, 7:59 pm

The growth of home prices in Edmonton is expected to slow down this year before picking up again in 2024-2025, according to a new report.

Canada Mortgage and Housing Corporation’s (CMHC) latest housing outlook says the annual average home price growth will be less than 1% this year in Edmonton.

The underlying reason is a shift in sales toward lower-priced options in the first half of the year, according to the report. In the second half of the year, home sales at higher price points, particularly when it comes to single-detached homes.

CMHC says construction on new homes will decline slightly because of the higher single-detached new home inventories. As existing inventories decrease, however, prices are expected to begin climbing toward the end of this year.

Edmonton and Alberta, more broadly, are projected to see massive growth in the coming years. Oil and gas prices remaining higher than pre-COVID levels will contribute to more favourable economic outcomes in the province through 2025.

Investment in major projects, including the Air Products Hydrogen Production and Liquefaction and Imperial Oil’s Strathcona Refinery, will also contribute to growth in Edmonton. The value of major projects underway in the area sits at about $33.2 billion — more than any other part of the province.

Canada Mortgage and Housing Corporation (CMHC)

This economic growth, combined with Edmonton’s relative affordability, is already attracting new residents to the city.

With more people moving here, many will be looking for rental units. The report believes strong population growth and higher mortgage rates will help drive demand for rentals and push the apartment vacancy rate down through 2025.

As the rental market tightens over the next few years, average two-bedroom rents will grow at a faster pace than in the past eight years.

“Edmonton is currently seeing a record pace of international migration and interprovincial in-migration at a high level not seen in a decade,” wrote CMHC in the report.

Nationally, the report states housing prices are expected to decrease, but high mortgage rates are expected to make homeownership less affordable for the rest of the year.

CMHC expects supply gaps in Canada’s most expensive and supply-constrained housing markets, Vancouver and Toronto, will continue as more people make their way to Canada.

Allison StephenAllison Stephen

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