Af­ford­abil­ity to drive 2019 mar­ket

StarMetro Edmonton - - DAILY LIFE -

As the res­i­den­tial real-es­tate mar­ket heads into 2019 fol­low­ing a chal­leng­ing 2018, sev-eral key fac­tors will play a role in de­ter­min-ing de­mand for homes and the types of homes peo­ple will be buy­ing in Ed­mon­ton and area. The key one of course is the econ­omy, as Al­berta con­tin­ues to strug­gle with much un­cer­tainty, con­cern and chal­lenges. That im­pacts con­sumer con­fi­dence in mak­ing big-ticket pur­chases and real es­tate is prob­a­bly the biggest one most peo­ple make in their life­times. On top of that eco­nomic cli­mate are other fnc­tors surh as ris­ing in­ter­est rates and tougher mort­gage reg­u­la­tions and Hous­ing Cor­po­ra­tion. You can re­ally see this by look­ing at in­ven­tory num­bers and the new types of units that are be­ing built. If you look at the num­bers for Ed­mon­ton, in­ven­to­ries are ris- ing for all seg­ments of the mar­ket ex­cept for apart­ments. So sin­gles are high and grow-ing. Semis are up there and grow­ing. So are rows. But apart­ments are com­ing down. This is in­dica­tive of the types of pref­er­ences that buy­ers have for new units in par­tic­u­lar." Jayne McKay, se­nior mar­ket an­a­lyst with re­search firm Ur­ban An­a­lyt­ics, says be­cause of the af­ford­abil­ity is­sue town­homes will con­tinue to be a pop­u­lar choice for home­buy-ers in 2019 as they were in 2018. "Town­homes are pop­u­lar be­cause buy­ers are seek­ing the most af­ford­able prod­uct type and town­homes of­fer a large amount of space in fam­ily-friendly neigh­bour­hoods for a very af­ford­able price: says McKay. Don Camp­bell, se­nior an­a­lyst with the Real Es­tate In­vest­ment Net­work, says Ed­mon-ton did not feel the eco­nomic down­turn as harshly as Cal­gary did. It had many large em­ploy­ment pro­jects al­ready on the go when t list­ings? says Camp­bell. "This will no ques-tion lead to a de­crease in the av­er­age sale price, which is im­por­tant to note that does not mean all houses drop in value. It is just an equa­tion that points to­wards an in­crease in de­mand in the lower one-third of the mar­ket price and a slow­down in in the lower one-third of the mar­ket price and a slow­down in de­mand for the top two-thirds of the mar­ket price range." Camp­bell says tran­sit im­prove­ments con­tinue to be a big driver of where peo­ple will be choos­ing to live, whether rental or pur­chase. This is es­pe­cially true in Ed­mon- ton, given the two new tran­sit lines that have ei­ther be­gun to be built or have fund­ing in place. "Over the com­ing decade," he says, lithe neigh­bour­hoods that are ser­viced by these new lines will out­per­form the rest of the city's neigh­bour­hoods."

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