Edmontonians seem eager to enter the housing market
The Edmonton resale real estate market could be in for a big year, given the findings of a recent survey about buyer intentions.
“The big factor is affordability,” says Benjy Katchen, chief executive of Wahi, the digital realty brokerage that commissioned Angus Reid to survey Canadians' buying intentions for 2024.
He notes that Edmonton's relative affordability for home prices may be one driver behind the study's finding that while about 18 per cent of Canadian respondents are considering buying a home in 2024, 25 per cent in Alberta indicated they might.
That's the highest among all provinces.
Katchen adds another factor behind the number is that Alberta's population is on average younger than other provinces. Consequently, the province has a larger pool of potential first-time buyers, he explains.
Additionally, Alberta has been the beneficiary of high interprovincial migration, with Alberta government statistics showing net migration reached a record of more than 56,000 last year.
Despite the fact tens of thousands of Albertans are considering jumping into the real estate market, many respondents noted they faced barriers to doing so.
About 27 per cent of Alberta respondents said they do not have enough savings to buy a home this year. That's compared with the national average of 28 per cent.
Perhaps the largest holdup is many are cautious about the direction of interest rates. Among Albertans, 51 per cent were concerned versus 48 per cent nationally.
Local veteran Realtor Doug Singleton agrees with the survey findings, noting the Edmonton market likely has a lot of pent-up demand.
“There are a lot of people right now waiting in the wings for more inventory to open up,” says the agent with Royal LePage Noralta Real Estate. “I would say we have a shortfall of inventory in many price ranges.”
Realtors Association of Edmonton statistics from January show new listings were at their lowest point for the month in the last five years, with the exception of 2022 — when the local market experienced record activity with many buyers seeking to purchase before the anticipated rise in interest rates.
“It's especially tight for homes under $500,000,” Singleton says, particularly for single-family detached homes, which have long been the most popular housing type in the city. “Conditions are negatively affecting first-time buyers the most.”
He adds many first-time buyers have stepped down their buying intentions to less costly options such as row homes.
“Townhouses have shown real good growth in recent months, even for older ones, just because of the lack of inventory.”
The reduction in affordable options — chiefly among single-family detached homes — may be one reason why about 53 per cent of Alberta respondents in the Wahi survey were waiting to see what happens to prices compared with the national average of 49 per cent.
“To me, that speaks to general uncertainty about the market,” Katchen says.
Still, Singleton expects the spring market — typically busy for real estate — will see an influx of buyers and inventory, a good recipe for sales growth and modest price appreciation.
“There are people out there waiting to get into the market, so spring should be very busy,” Singleton says. “That should lead to a pretty good year overall.”