RE/MAX Edmonton Real Estate News

Economic forecasts are rampant, particularly in industry driven regions like Alberta, yet amidst the highs and lows we have seen the Edmonton real estate market remains remarkably steadfast amidst the unrest. Upon review of recent fall statistics, the EREB is cited as noting the market to be “stable” due to only “marginal dips in prices and unit sales”. This resiliency is surely a welcome reprieve for buyers and sellers trying to determine if they can weather the storm, so to speak.

Some words of assurance come to use from REALTORS® Association of Edmonton chair Steve Sedgwick,

“Alberta’s economy has been under enormous pressure for some time, but the residential real estate market in the Edmonton Census Metropolitan Area continues to hold. Prices and unit sales for all residential homes are consistent with last year, down less than 1% and 2% respectively,”

Sale prices on average have dropped only a marginal 4% in month over month comparisons but they key comparison factor, year over year statistics, remain the same as fall of 2015, levelling out at $369, 956. Single family homes reflected an identical 4% month over month percentage drop averaging out at $434, 362 (compared to last year’s $450, 362), while EREB figures show a year over year decrease of “less than 1%”. Condo prices show the same negligible year over year consistency, and a month over month decrease of only 2% to $251, 526. Finally, in the rowhouse/duplex category, residences averaged out at $344, 377 which is a year over year decrease of just 2%, and a 1% month over month drop.

A small dip was seen across residence categories in unit sales figures, with a month end total of 1,433 sales. This total reflects a 5% and 2% decrease month over month and year over year, respectively. More specifically, this total breaks down to 861 single family homes sold, 406 condominium units, and 136 duplex/rowhouses. Two categories showed a small decline in total overall sales from the year previous; a 3% drop for single family homes, 6% for condominiums. However, duplex/rowhouses which have been a popular style particularly in the 2015/2016 financial cycle showed a year over year increase of 11%.

In terms of listings, the MLS system saw 7908 available properties by month end, a small 2% decline from the previous month’s total of 8,048. Inventory this time last year fell to 7227 MLS properties, meaning we have seen a 9.4% inventory increase.

Sedgwick once again assuages buyers and sellers alike, explain how very expected these small seasonal lulls are seen to be,

“While this is one of the most active times of the year, we are seeing both listings and sales tapering off as we move into the fall months. This is standard in our local real estate cycle,” said Sedgwick. “While unit sales for condos have been impacted the most, prices remain stable. This is thanks in part to the continuing trend of unit sales of over $750,000 that are keeping average sales price of condos elevated by almost 3%.”

Finally, the days on market factor is reported by the EREB as “consistent” in year over year review. Average days on market was about 55, the same as this time last year, and one day less in month over month comparisons. Single family homes came in at 49 days, condominiums at 62 days, and duplex/rowhouses leveled out at 56 days.

Just outlaying Edmonton’s original core, is the area of Westmount. It’s 1910 boundary establishment makes this neighborhood one of the city’s oldest and most established. A strong history of growth and development contributes to the cultural richness of the area and it’s vibrant community spirit.

Westmount Homes. Photo Credit: Avenue Magazine

Westmount has some of the most desirable real estate in the city, with an abundance of appealing  character homes. Over 25% of it’s residences were constructed prior to the end of World War II. The strong sense of historical pride in this area can be seen in these immaculately maintained, period houses.

Bordered by thoroughfares of 111 avenue, Stony Plain Road, Groat Road and 121 Street, this neighborhood has all the charm of downtown living without, well, actually living downtown. It’s cornerstone is the bustling 124 Street, dotted with cafes, boutiques, art galleries, and the newly popular 124 Street farmer’s market (open Thursdays in the spring and summer).

Reflecting the liveliness of Westmount is the younger community of Meadowlark Park.  Though it wasn’t established as a community until much later, it has certainly made up for lost time in it’s short but interesting history. Now this neighborhood, with an increasingly youthful demographic, is notable for it’s young families and abundance of children being raised in the area.

The Edmonton neighborhood originally belonged of the town of Jasper Place, and at the time lay far outside the city limits. However, as Edmonton continued it’s rapid expansion, many smaller towns became absorbed into the metropolis. In 1964 Jasper Place became one o f these annexed locations, including of course, it’s small area of Meadowlark.

Located in the west end of the city, the community spans from 156 Street and 87 Avenue to 163 Street and 95 Avenue, just a stones throw from West Edmonton Mall, the Valley Zoo, and the vast network of the river valley trail system, ideal for it’s young families and those with on-the-go lifestyles.

Jasper Place Library

Meadowlark is known for strong involvement in it’s community league, including year round fundraising, fitness programs, and children’s recreation programs. The flagships of Meadowlark Shopping Centre and the beautifully renovated Jasper Place Library branch showcase the recent economic growth of the area.

Spring in YEG means a busy real estate market.

Spring season is a bustling time in the city, and the real estate market is no exception. As the sun comes out and melts the snow that makes the thought of hauling boxes in a blizzard so terribly unappealing, sellers and buyers alike have a renewed sense of enthusiasm.

March 2016 saw an unprecedented 63% increase in residences sold. The promise of better weather saw 1364 properties sold in contrast to the 837 bought in February. In year over year comparisons this shows a negligible 1.5% decrease from the same time last year, as the Edmonton market proves a continual resiliency in the face of a so called nation-wide economic crisis, with a particular strain on Alberta. Of the 1364 property transactions last month, condominiums represented 335 of those and the duplex/rowhouse market represented 144 properties. This shows a respective rise of 44% and 82% in these markets.

Just as the winter lull was predicted this March influx was expected seasonally.  “Sales, relative to last month, were consistent with the seasonal trends that we expect” comments REALTORS® Association of Edmonton Chair Steve Sedgwick.

However, this positive upward market trend should provide no source of concern to buyers as sale prices remain relatively steady in month over month comparisons. Residential sale prices for March averaged out to $379, 524, a small 3% increase from the month previous, and and even slighter 2% increase from March of 2015 where prices held at $372, 289. A market breakdown of this average shows single family home sales up 0.56% from last year at $439,815, and 4.73% from this February. Condominiums ended the month at $251, 093, up 1.62% from the month previous and 0.55% year over year.

“When looking at housing prices, we have to take into account a number of factors,” Sedgwick said. “Last month, we saw sales of two homes in Edmonton that were priced at more than $3 million dollars. This is the first time that properties at that price point have sold in 2016, and those two sales affected the average price by several thousands of dollars. So it is important that we also look at the median prices as well, to gain a clear picture of the market.”

List prices are also reported as steady month over month and year over year, with a March average of $357,750, a drop of about 1%; the same last year showed an average of $360,000. This also shows a 3% rise from list prices the month previous. Single family home prices increased about 1% to $405, 000, down from $410,000 year over year.

Continues Sedgwick, “Inventory is growing, with more than 3,000 properties coming onto the market last month. Despite the inventory growth, prices are holding steady, with median prices on par with last year, and average prices up slightly due to the sale of high-end luxury homes in March.”

Finally, days on market statistics showed a drop in most all categories of residences, with an average of 53 days on market; 4 days less than the month previous. Single family homes also showed a 4 day drop, down to 49 days on average, and duplex/rowhouses dropping 9 days to an average of 62 days on market. Lastly condominiums were up one day from February of this year, to 58 days.

Edmonton News agencies including the Edmonton Sun, Global News, and the Edmonton Journal are reporting on recent community resistance towards the City of Edmonton’s infill project.

The ambitious project had been relatively well received by Edmonton residents, contractors, and particularly newcomers desperate to find residence amongst the city’s ever increasing population spike.

The project encourages the construction of new residences on existing properties, such as duplexes, the addition of rental units over garages, and basement suites. This will allow a population expansion in Edmonton, which does not see signs of slowing down, without the often associated sprawl of suburban communities. To encourage development, the city has been particularly lax on approval policies related to the former bureaucratic red tape of the projects.

Rumblings are beginning to be heard from homeowners, who are now organizing to voice their concerns.  Of particular note is the message board website EdmontonLotSubdivision.com which has been active since early last fall but is picking up momentum.  Of the largest concern to homeowners is the lack of an appeal process. Citizens are looking towards their city councillors and MLA’s in hope of some response. Says Westbrook community member Darren Jackinsky,

“Fundamentally, it’s that it’s been forced on people and that there’s no structure in place to appeal an approval of a subdivision.” He goes on to explain the difficulty in voicing homeowner dissatisfaction, “we’ve so far been told essentially by the MLAs that it’s a city issue — talk to your councilors — and the city is saying talk to your MLA, it’s a provincial government issue.”

According to Edmonton Journal reports concerns arose because “the appeal process exists for developments on already split properties and for subdivisions that are denied, but not for the subdivisions themselves.”

The latest vocal outcry is coming from the residents of Rio Terrace. A 500 signature petition and 100 letters were submitted in opposition of a split-lot skinny house proposal, believing the development would not to suit the aesthetic design of the neighborhood.

City Councilor Michael Oshry, a proponent of the project, is dedicated to working with residents to clear up misconceptions while maintaining momentum. He believes misinformation has led to recent outcries,

“I’m happy to listen to them, but I do think a lot of the supposed support for no infill is based on information that either people don’t know, or people have misunderstood, or even been misled on occasion…I think these are people that are just concerned about what they think is going to be a dramatic change to their neighbourhood. And I think what they don’t appreciate is what actually is going to be built there.”

Oshry has explained that in the instance of Rio Terrace, lots are 22 meters wide, meaning a split lot is still not so small to reasonably necessitate a house. Additionally, replacing a single, aging, bungalow with two higher value homes positively impacts the value of neighboring properties. The City sees the project as a win-win for communities.

Oshry concludes, “At the end of the day, in my view, I don’t think it’s going to make one iota of difference. You’re going to end up with two homes with two nice families living in a nice neighbourhood.”

Will YEG weather hold? Or should we prepare for second winter?

February in the YEG Real Estate Market carried a familiar theme, inventory.

More and more homeowners are continuing to see the value in listing their residences with MLS, as market prices are tending to remain steady. Market forecasters indicate that the predictable seasonal lull will be drawing to a close in the foreseeable future, as snow continues to melt and temperatures rise in the city.

“Buyers are still taking their time to consider all of their options before purchasing a new home,” Says REALTORS® Association of Edmonton Chair Steve Sedgwick. “But with warmer weather just around the corner, clients are reaching out to their REALTOR® for support as the busy spring buying season approaches.”

The early months of 2016 have seen fluctuations to over 6,000 residential listings on the market, with February closing at 6,682 MLS properties for sale. This total indicates just a 16.2% increase from January, however the year over year numbers show a more impactful 36.5% rise from February of 2015.

Average residential sale prices saw a mild increase in all categories across the board. The category of Duplex/Rowhouses continued to be the market superstars, showing an 8.41% rise to $354,386, up 8.41% from January previous, and a 1.24% from the same time last year. The real surprise in February came from renewed market strength of condominiums, which had lately been showing drops or only negligible rises, yet which had gains of over 8% last month (8.83%) for an average sale price of $247,090. This price tag indicates a minimal year over year drop of 1.32%. Single family homes remained nearly steady from January, a 0.24% increase brought their average to $419,940, which showed a 2.79% drop from February of 2015. The month ended with a total residential sale price average of $363,366, a healthy 6.93% rise month over month and virtually no change in year over year comparisons.

February showed a large climb in reported sales, with 837 by month-end compared to January’s 618. This indicates a 36.5% jump month over month. February of 2015 saw 931 residences sold, which shows a current 10.1% decrease. Explains Sedgwick

“Sales numbers are increasing consistent with seasonal trends. Relative to 2015, potential buyers have more inventory to choose from. Despite this inventory growth, prices have moderated only slightly compared to last year, so home owners and sellers can maintain some confidence that housing prices are remaining stable.”

These remarks are also reflected in days on market averages for the month. The average residence was on the market for 57 days, which shows a year over year increase of 48 days. Despite climbing inventory however, this is a remarkable drop from January’s 71 average days on market. Of particular note, Condominiums averaged 57 days, an even more significant decrease month over month from a previous 85 days.

How much will oil field politics impact Edmonton’s Real Estate economy?

A February sales report published by the EREB titled “Home buyers continue to cautiously watch market” has left some feeling less than optimistic. There is no denying the ongoing concerns of Albertan’s over the economic future of the province, however the real question is, to what extent will recent political and oil industry events impact the province’s real estate industry? It is very plausible that the market, which has proven itself as more than a little resilient, is simply experiencing a predictable lull.

The recent economic downturn appears to be creating undue concern amongst market consumers and professionals; a concern that is starting to be reflected in market activity, as explained by REALTORS® Association of Edmonton Chair Steve Sedgwick,

“Sales volumes are down, relative to the same time last year…It is likely that home buyers are responding to current economic uncertainties. Although prices have dropped slightly, they remain stable. Growth in inventory may create more opportunities for potential buyers, and given the low interest rates, we remain optimistic about market growth as we head into the spring buying season”.

The report goes onto to show strong inventory numbers, with 5,751 MLS properties available going into February. This figure is almost a 40% increase from the same time last year, creating a great deal of consumer options for discerning buyers. This massive inventory increase hasn’t yet caused market saturation concerns, as sales from the same time last year are down a mere 7.21%. However in contrast to the month previous, December of 2015, sales dropped just over 14%.

Continuing in favour of a buyer’s market, a small decline occurred in residential sale prices. The average single family home price hovered at $418, 928 down 1.2% from the month previous, while condos show a larger 8.8% decline in the same time frame, for an average of $227, 052. The largest drop showed in the category of duplex/rowhouses which averaged out at $326, 885, a double digit decrease of just over 12%. All in all the residential category saw a 7.2% decreases in month over month sales, and a 6.3% decrease year over year for an average price of $339, 714.

The larger inventory is likely contributing to a rise in average days on market, which has increased to 71 days, up from December’s 62. Comparatively, this time last year, the average was about 58 days to market. The EREB report attributes this average rise mainly due to condominium sales “which sat at 85 for January, up from 62 from last month and 61 YoY” (EREB).

Concludes Sedgwick,

“The increase in the average days on market just appears to reflect that buyers are taking time to consider their options before purchasing a new home,”. He continues, “Clients are looking to their REALTOR® for advice and guidance as they navigate their own individual situations.”

2015 went as quickly as it came, and we are left with another year of choices to reflect upon. Wether  you felt it was a highly successful year, personally or professionally, or if 2015 left something to be desired, the key to reflection is personal growth. The following steps are aimed at personal development which in turn will make your a more accessible and approachable professional figure. Implementing these small life changes will show dedication to continual self improvement.

Be A Swift Responder. Make a point of returning correspondences immediately. Have your calls, emails, and social media messages forwarded to your smart phone, so you can receive communication from anywhere, and more importantly, respond immediately. Turn that potential customer into a lifelong client by being the first agent to reply.

Commit to Lifelong Learning. Sign up for courses offered by Re/Max University, AREA Professional Development to always be challenging yourself and grow. It doesn’t have to be innately real estate related. Why not take a Metro Continuing Education photography class, and take better photos for MLS, or choose a beginner language course and broaden your client base.

Maintain Your Network. Have a lawyer, mortgage broker, painting service, and house cleaner on hand and build good relationships. Send wine, gifts, and thank you notes to show appreciation for a job well done. Send Christmas cards to past clients; even if you know they’re not interested you never know who they will pass your name to. Is your cousin in the furnace repair business? Keep a card on hand to refer customers to. Making an effort in all facets of your life will help improve social skills, build reciprocity, and create a dedicated business persona.

 Be an open book. Don’t leave your clients in the dark or assume they understand the real estate process. Many clients may be first time buyers and are probably more terrified and overwhelmed than they let on. Don’t be afraid to over-explain, people will stop you if they get it, mostly likely though they will be grateful to have the additional info. It also gives you a great chance to shine, you’ve put a lot of effort into honing your real estate skills, why not take moment to show off.

 Practice Self-Discipline. This means showing up on time, never double booking, being mentally present with appropriate paperwork, and having your homework done. This will show the client that you respect their valuable time, and appreciate their business. Show up to a viewing ten minutes early, with extra highlight sheets, and an overview of the neighbourhood and amenities. Your clients will see you care as much about their new home as they do.

Adapt to technology. Chances are if you aren’t particularly picky you will have a broad range of clients with a large range of abilities. You may have established clients who like phone calls, hang on to business cards, and receive faxed documents. Then of course your new clients may prefer dealing in texts and emails, having found out about you via your twitter or facebook page. Keeping current and constantly adapting opens you up to the broadest possible market of clientele. It takes less than 5 minutes to post an Instagram of your new listing which can then be cross shared with Facebook and Twitter. “Check-In” at your open house so clients know where to find you, then share success stories and photos of happy customers. It will showcase you as a genuine person with a real passion for client satisfaction.

News agencies across the country are reporting on new nationwide mortgage protocol to affect many real estate consumers. The federal government has implemented a larger minimum down payment for high valued homes in Canada.

Currently the Canada Mortgage and Housing Corporation (CMHC) requires a down payment of 5% in order to qualify for their insurance protection. This CMHC is support is not required in all circumstances, but crucial for lenders to see when a mortgage value is worth upwards of 80% of the home’s value. As reported by the CBC:

“Banks are forbidden to provide “high-ratio” mortgages — when the amount being borrowed is more than 80 per cent of the home’s purchase price — without taking out insurance for it.”

The new CMHC prerequisite, handed down from the federal government, will require a new minimum down payment of 10% on homes worth over $500,000. However the additional cost will only apply to the amount that exceeds that total.

This means that buyers will still pay only 5% on the first $500,000, and then any excess amount above that will require the 10% down payment. The CBC report explains:

“Once the new rules are implemented in 2016, someone looking to buy a $750,000 home would need to have a minimum down payment of $50,000, which is what you get when you add five per cent of $500,000 and 10 per cent of the remaining $250,000.”

Finance Minister Bill Morneau has explained that the from a financial standpoint the move is an effort to “create an environment that protects the people from buying homes so they have sufficient equity”. Bank of Montreal Capital Markets has unpacked the issue and seems to agree that the impact will be for the greater good, according to senior economist Robert Kavcic,

“Rather than a blunt instrument to cool the market, this is a targeted measure designed to deter a very small segment of buyers from stretching into the market with a very low equity position”.

What will the local impact be from these measures? The EREB has addressed this issue from a local standpoint and comes out optimistically. The average sale price in the Edmonton census metropolitan area falls well below the $500,000 price point, currently at $438, 172. REALTORS® Association of Edmonton affirmed this sentiment.

“We are pleased that the tiered approach should have little effect on first time home buyers looking to get into the market. However, we will continue to watch the Edmonton market to see what effects this national change has locally.”

In 2015 there were 2,721 residential properties that sold for over $500,000. The new measures are cited to take effect February 15, 2016.

The EREB is currently reporting a mild to moderate dip in sales thus far into the fall season. The Board however is emphasizing that this decline has not affected sale prices, which have slipped less than one percentage point from the same time last year. The drop in sales year-over-year is slightly less negligible at 6.76%. REALTORS® Association of Edmonton Chair Geneva Tetrault has a message of reassurance, “The strength of prices in the Edmonton market is an excellent indication that we are maintaining stability.”

This is the first dip of many we are seeing as the Edmonton CMA moves out of fall and into the winter months. Tetrault goes on to address these relevant seasonal changes,

“We will likely see prices continue to dip as we move into the colder months. Real Estate in Edmonton has a very seasonal trend and colder months always mean fewer sales. We may see buyers take advantage of this trend and benefit from low interest rates while they still can.”

Compared to September 2014, single family home sales and condominiums have both dropped over 9% year-over-year (9.72% and 9.07% respectively), yet duplex/rowhouses, consistently this year’s top seller, maintain their market strength showing numbers rising above 17%.

As mentioned, average sale prices have been negligibly affected, with percentage change remaining in the low single digits. September’s single family home price average was $432, 150, showing a 1.75% drop from the month previous and 0.98% down year-over-year. Condominiums remained fairly stable at $252,953, only dropping 0.68% from August, and 1.05% from last September. Duplex and rowhouses continue to capture the market spotlight, both month over month and year over year figures rising, to an average of $264,203. That shows a 2.76% increase from the month previous and 4.28% from September 2014.

There continues to be no shortage of inventory in the Edmonton CMA with 7,108 properties on market at the time of reporting. This is a slight 1.65% decline from August numbers, but still shows a steep increase of 47.71% over inventory last fall season.

“Buyers continue to see the benefits of a healthy inventory but we haven’t seen many sellers dropping prices significantly in order to compete. Last year’s market and its low inventory made buyers feel pressure to jump into an offer if they found something they like. We are seeing buyers take a little more time in the decision making process this year.” Tetrault continues, explaining her optimism for fall buyers.

CLICK HERE to connect with and Edmonton CMA Real Estate Agent.

The Canada Mortgage and Housing Commission (CMHC) has published results from their most recent quarterly HPAA (House Price Analysis and Assessment) Framework. This report announced the most recent findings on present housing market risks in Canadian Census Metropolitan Areas.

Click here to view our summary on last quarter’s report and compare market changes.

The four areas of risk that are estimated quarterly by the CMHC include overheating, acceleration in growth of house prices, overvaluation, and overbuilding. The report also indicates the consideration of factors such as “demographic, economic, and financial factors such as population growth, change in personal disposable income, and interest rates.”

Overall national assessments show the four categories averaging out to a ‘low risk’ market. Some moderate yet stable overvaluation is occurring as residences are being priced at slightly above personal disposable income and population growth.  Inventory is presenting at low risk, yet is slightly above historical averages. The report indicates that on a national level “overheating and acceleration in house prices are not a concern at this time”.

What does this mean for Albertans specifically? As a province we seem to be very much in line with the national averages, with Edmonton showing slightly better results than the Calgary market.

Details of the CMHC report for Alberta CMA’s

Calgary’s minor risks occur in the area of house prices, which are gaining quicker than personal disposable income, therefore overvaluation is the only factor presenting a moderately increased risk factor. The report attributes these pacing issues with low oil prices impacting income growth and unemployment. Additionally, there has been a slowing of incoming population growth due to “weaker market conditions” in the region.

Edmonton presents no moderate risk factors at this time, despite national and regional issues with overvaluation.  Some economic changes occurring in the region may indicate future risks however. The report again cites lower oil prices slowing employment growth and limiting migration to the city. Ass of yet these factors have yet to show significant statistical impact on the market however.