Edmonton, AB real estate market outlook 2023
We sat down with our realtor partner Sara MacLennan to give us an outlook on the Edmonton real estate market for 2023. Sara has been writing on the real estate market in the Edmonton area since 2005, and runs a brokerage with her partner Sheldon Johnston.
You can find out more about Sara and her brokerage at Liv Real Estate.
How has the Edmonton real estate market done over the past year?
Sales in 2023 are well below the levels we saw during the pandemic, and seeing headlines about sales dropping 40% from last year can be concerning. When you take a step back and look at the bigger picture, sales in 2023 are well ahead of every year since ‘07 other than 2021 and ‘22, and that’s started to be reflected in the prices as well.
As of April 2023 the residential average price is $408,631. This represents a 6% decrease from April 2022, but is 4.8% higher than last month, showing how fast prices can rebound. Detached homes, on average, were priced at $500,635, showing a 4.6% year-over-year decrease. Condominiums had an average price of $192,560, with a 5.8% decrease from April 2022 and a slight 0.1% decrease from the previous month.
Like other areas in the country, the market has definitely been brought down by the rate hikes from the Bank of Canada. Now that the Bank of Canada has been holding rates steady, we’re starting to revert to the usual trend and are seeing steady appreciation in prices.
Source: Realtors of Edmonton
What factors do you see impacting the Edmonton market?
In my opinion net migration is the biggest factor impacting our market.
Alberta’s population grew by 160,000 last year which is huge compared to the size of our cities. In the 4th quarter alone our net growth was over 45,000 (the highest percentage in the country). In the 4th quarter our net interprovincial migration also led the country at over 11,000. What all this is telling us is that not only are new Canadians moving to Alberta, but also Canadians from other provinces are moving here for a number of reasons, but largely due to the cost of living.
Lucky for us, we have plenty of new listings coming on the market in Edmonton. Meanwhile in Calgary, inventory is extremely low, and prices have hit an all-time high. Our inventory is still below normal for this time of year, and for the second month in a row, we find ourselves in a seller’s market with a 3.4-month supply of listings.
Where do you see the Edmonton market going in the future?
I think we’re going to have a stronger second half of the year. With so many new Albertans the rental vacancy rate is very low in Edmonton, and rents are on the rise. This should push more people into the market to buy.
As we’re already seeing, there are many people moving to Alberta, and the majority of them are coming to Edmonton and Calgary. I expect that in the near-term this trend is going to continue, and if rates come back down and the price of homes starts to appreciate more, we’re going to see even more inter-provincial migration as the younger generation faces higher cost of living in other provinces.
Edmonton is a great city and people are moving here to achieve their dream of homeownership, start a family, and enjoy our beautiful city.
How has the Edmonton market compared to Calgary?
Calgary has extremely low inventory, so competition is very high for buyers since they are in a severe seller’s market. We are also in a seller’s market, but we have about 3.5 months of supply, so we’re not seeing as much competition for listings as they are in Calgary.
Overall, Edmonton is in a better position to handle the influx of newcomers. At the same time there are similarities in the markets, and the bottom line is if you’re looking to buy a home, don’t wait on the sidelines. You can’t expect prices to stay the same long term, and we’re already seeing the market start to rebound from the correction we had last year.
What advice would you give to someone thinking about buying in Edmonton?
My best advice would be to find a real estate agent that you trust that can help guide you through the process. Our agents offer personalized consultation sessions and give you the basic information you need to get started. We will help you avoid costly mistakes, explain the process of buying a home, and give personal recommendations for reputable mortgage brokers, inspectors, lawyers and any other professional service providers you may need. These sessions are free, scheduled at your convenience, and there is no obligation to work with us after the session.
Thanks to Sara MacLennan for answering these questions and giving us insight into the Edmonton market.
Sara’s contact info:
Check out our interest rate forecast for an up to date outlook on the mortgage market, including where our analysts predict rates will go over the next 5 years.