Local housing prices on the rise, Royal LePage reports

It’s a seller’s market in the city, as Edmonton’s growing middle class and strong economy have led to a boost in both price and demand for housing.

Condominium prices have increased the most, according to a report from real estate company Royal LePage. The average price of a condo in Edmonton has increased 7.8 per cent year-over-year to $236,429, while two-storey homes also increased 3.8 per cent, to $372,112. Detached bungalows took a hit, dropping 0.2 per cent yearover-year to $350,401.

The numbers are part of a national study conducted by Royal LePage, which collected information on seven types of housing in more than 250 neighbourhoods across the country. Results show the average price of a home in Canada increased between 3.9 per cent and 5.2 per cent in the second quarter of 2014, and the company predicts this number will rise to 5.1 per cent for the full year when compared to 2013. Edmonton condominium sales have been consistent despite a selection of properties on the market, Royal LePage associate broker Tom Shearer said.

“The average price for a single family home has gone up so much that when you can’t afford to buy a single family home, you buy a condo,” Shearer said. “And I think that’s happened around the city.”

Housing prices remain highest in the southeast and southwest neighbourhoods of the city, Shearer said. More affordable homes exist in the northeast and northwest parts of the city, as well as in neighbouring towns like Beaumont and Spruce Grove.

Junior executive homes in Edmonton ranging from $600,000 to $800,000 have seen slower sales in recent weeks compared to lower-priced homes, Shearer added.

Royal LePage expects Edmonton’s housing prices to rise 4.5 per cent by the end of 2014.

Detached bungalows proved more lucrative in Calgary, where the oil and gas sector led to persistent demand and shortage in the housing market. Bungalow prices saw an increase of 9.7 per cent year-over-year to $501,200, and condominiums saw a major boost of 9.3 per cent to $286,422. Standard twostorey homes saw gains of 7.9 per cent to $489,589. The real estate company predicts a 5.5-per-cent increase to yearover-year prices in Calgary by the end of 2014.

In a news release Wednesday, Royal LePage president Phil Soper said a lack of housing availability in Canada’s bigger cities is driving prices upwards.

“Chronic supply shortages are driving price spikes in Canada’s major cities, masking otherwise moderate home price appreciation nationally,” he said. “While a widening affordability gap in Canada’s largest urban centres is characterizing the national market Canadians read about, daily, year-overyear house price increases in most regions of the country are presently tracking below the historical average.”

Housing prices are expected to track closely to the rate of general economic growth in 2015, he added, while price increases in Canada’s largest cities will level off as smaller city markets will see a boost.