RE/MAX Edmonton Real Estate News

Major media outlets are reporting on the RBC Economics “Housing Trends and Affordability Report” released this past week, dissecting the information to glean what it could mean for the economic future of the Canadian real estate market. The report, proving most promising to Alberta buyers, showed a softening market in the region.

As explained by RBC, the aim of the report is to “capture the proportion of median pre-tax household income required to service the cost of a mortgage on an existing housing unit at going market prices, including principal and interest, property taxes and utilities.” Essentially it details to Canadians the state of the economy in major markets and how that stacks up against real estate trends of the same area.

Chart from RBC’s report showing nationwide affordability change over the past 30 years.

The report initially highlights declining oil and gas prices as a key influence in real estate trends, especially in regions like Alberta, where there is a strong economic reliance on those primary industries.

As stated by RBC,

We had previously reported last winter during February’s oil skid on the market’s ability to remain immune, with residential sales figures continuing to rise or at very least stabilizing. Now, nearly six months later, we are only starting to see the effect of one industry over another.

Chart contrasting nationwide affordability with provincial level rates.

The slight market decline currently underway in Alberta is creating an ideal climate for homebuyers with the Edmonton and Calgary areas “show[ing] the biggest improvement in affordability in the first quarter”.

RBC also attributes mortgage cuts, starting early in 2015, to the steadying of markets through the early stages of the oil skid, as it created affordability for buyers in the face of skyrocketing sale prices and a declining economy.

In the province, it was reported that RBC’s affordability measures fell by 1% for two-storey homes, 0.7% for bungalows and 0.6% for condominiums. It is indicated by RBC that these levels are “attractive” when compared both historically and cross provincially, and strongly suggest a stabilizing of real estate activity.

Overall, RBC is expecting that “balanced demand-supply conditions in the majority of local markets will continue to support generally modest price increases and fairly stable levels of affordability. The likelihood of small price declines in markets dependent on the oil industry suggests that home ownership costs may fall further in Alberta”.

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Image Credit: Calgary Herald

Just over a month ago the provincial budget was released and now that citizens have finally had the time to sift through the comprehensive report, there is a new awareness of how it will affect personal financial choices. From the perspective of the real estate market, the largest impact will be seen in land title fee increases.

This will affect buyers most directly in terms of closing costs. Additionally, homeowners looking to refinance will also be hit by these additional fees. As explained by DBB LLP land title fees are part of the larger category of disbursement fees, as distinct from the actual legal fees. Disbursement fees are the hard costs incurred by the law firm as result of the real estate transaction. This makes the government fee less than immediately apparent, and a careful review of cost breakdowns may be necessary. Obtaining and transferring land titles is an integral part of a real estate deal, as well as legally necessary, therefore there is no means of avoiding this new government incurred expense.

Though the fee hike is not immediate, it will come into effect on documents registered on or after July 1, 2015, approximately 90 days after the budget announcement which, in real estate terms, will come up quite quickly.

It is important to note these dates are not impacted by possession date, only registration date is a factor.

As of July 15th the variable fee will increase from $1.00 to $6.00 while the flat fee (for land title and mortgage registration documents) will increase to $75.00 from a previous $50.00. These numbers appear to be quite negligible, especially as an additional cost on a property deal worth hundreds of thousands of dollars. However when applying these increases to examples, the additional costs become immediately apparent:

A summary of cost impact courtesy of DBB LLP Law.

For potential buyers, or owners considering refinancing, this fee hike could be seen as a motivator to move quickly on a decision as there is still ample time to close a deal before the deadline arrives. However, due to increased activity in the summer months, as much time as possible is necessary for lawyers and the land title office to complete registrations within the time frame.

CLICK HERE to connect with a Real Estate agent who can answer all your home-buying questions.

Housing prices have been resistant to economic decline

In the face of economic downturn there are still expectations that Canadian home prices will continue to rise. It is being reported that while the growth may slow understandably, there is no foreseeable slump in the any of the major real estate markets of Canada.

Despite plummeting oil prices a predicted nationwide appreciation of 2.9 % can be expected on 2015 residential sale prices. The major centers of Toronto and Vancouver are predicted to see increases of as much as 4.5% and 2.8% respectively.

2014 saw prices surpass historical averages; residential detached bungalows rose about 6.7% throughout the nation. Edmonton’s condo market saw the largest nationwide increase at 12.2%, contrasted with the cross-country average of 4.5%.

ATB Financial Chief Economist Todd Hirsch comments on the predictability of the oil markets:

“This happens over and over. In fact, in 2009, we saw a similar price plunge like this and it was quite short-lived and things rebounded…I don’t think we should worry too much because I think it will be quite temporary.”

Alberta in particular has prosperous industry to fall back on, such as agriculture and forestry, which have the potential to thrive in low oil price conditions. Additionally, as reported by the Calgary Herald, Alberta saw a “50 per cent increase in meat product exports last year along with growth in the aerospace, farming and chemicals sectors.”

Pierre Cleroux, Chief Economist with the Business Development Bank of Canada reasons

“Oil of course is the No. 1 export product from Alberta but we often forget that Alberta is also a diversified economy. There’s other sectors that are doing well.”

The real estate market outlook is optimistic due to other economic factors like labour market trends and a continuing surge in demand from homebuyers. At this point the multitude of positive aspects continue to outweigh the decline seen by a deteriorating oil market.

CLICK HERE to search for available Edmonton properties. 

Edmonton’s real estate market is holding strong as it comes into fall, however a rising market also means  larger price tags on residential and commercial properties. Current and prospective homebuyers can take comfort in their investments however, as statistics are showing the Edmonton market to be one of the most affordable in Alberta.

A recent article posted by Global Edmonton targeting the competitive nature of the Calgary and Edmonton real estate markets uses sales figures to show Edmonton in a clear win situation when comparing affordable housing prices. Additionally the Calgary Herald has made mention of record high prices in the large southern Alberta city.

Residences in Edmonton are Readily Available to Home Buyers. Image Credit: Global Edmonton

Calgary has seen a 10.48 % increase since the same time last year, nearly double the national average. When comparing 11 major centres across the country, the sales figures increase was about 5.33% on average, according to the MLS Home Price Index. Additionally price growth percentage in Calgary has increased 25% over the past 3 years, while nationally that number is hovering around 12.5%.

Economist Leslie Preston (TD Bank) explains the situation down south:

“Existing home prices . . . are on track to outstrip income growth for a second straight year in 2014, which adds to concerns about an already-overpriced market. Affordability, even at low interest rates, has become an obstacle in many markets.”

Global News reports that coming in to winter the average home price in Calgary will be approximately $99,000 higher than that of Edmonton, and about $103,000 in the new year. According to Edmonton’s Chief Economist John Rose:

“When you look at housing affordability issues, Edmonton is actually – among Canada’s major metropolitan areas – one of the most affordable in terms of housing. You have to bear in mind that incomes in Edmonton are about 20 per cent above the national average.”

The affordability and availability of housing in Edmonton can account for the latest population influx in the area, and the strong economic upturn, especially in the real estate industry. Click Here to search for properties for sale in the Edmonton area.

There’s a chill in the air in Edmonton, and it may be safe to say summer is over. On that (slightly sour) note let’s take a look at residential real estate sales over the summer months in Edmonton.

Fresh from all-time highs in spring, prices dipped a little over the summer months beginning in mid to late June, providing some relief to potential home buyers. Single-Family dwellings saw a slight decrease in average price, with July costs around $426,716. That shows just a  2% drop from June sales, with total residential sales showing an average price drop of around 2.6%.

Total Sales Statistics-Residential.

Interestingly, the changes in Condominum prices were quite negligible differences, seemingly unaffected by market influences.

Condominium Sales Statistics

Though prices are showing a temporary lull, there is still an overall trend of increased sales figures. REALTORS® Association President Greg Steele weighs in on the changes:

“Like the shortening summer days and the appearance of fall fashions, real estate prices begin to soften at this time of year. Despite the seasonal slide, prices in the Edmonton area are still up when compared to the same month last year. The local market continues to be very active and REALTORS® report having a busy month.”  

 

Single-Family Dwelling Statistics.

Steele has quite accurately described the seeming dip in the trend, whereas housing prices have the appearance of dropping, they are  statistically still showing an increase from the same time last year. Overall residential prices were up 3.3% from 2013, with the single-family dwelling up almost 4%. The most marked year-over-year upsurge appeared in condo prices, which are gaining increasing popularity in the city as a more viable residence option, showing an increase of about 4.6% from last summer.

Along with a sale price increases, total overall transactions are skyrocketing as buyers become more eager to invest in Edmonton’s booming real estate market. July saw the sale of 2,013 residences (639 of them condominium units); a 9.7 % increase from the 1,835 residences sold in July of 2013.

Steele also addressed this influx of transactions:

“The demand for real estate remains strong and in line with other market fundamentals. Fortunately, year-to-date listings are also up compared to last year and there is adequate supply with over 5,600 residential properties in inventory.”

Homes in June on average were selling in about 41 days, and in about 46 days for July.

Click here to create a custom property search for Edmonton and the surrounding area or visit our Market Stats page for more details and the most up-to-date numbers! 

It’s that time of year again.

With heads hung low, our young’uns are dragging their feet back for yet another year of schooling. For those of us with not-so-young’uns this might mean experiencing their first year of collage; some in a new city, or just a new part of the city trying to live life on their own. This is why the surrounding residential areas of the University of Alberta have become so desirable.

Aerial view of campus and surrounding neighbourhood. Image credit: University of Alberta

There are many tiers of residence options from condominiums to large family homes. Residences can be bought with the short-term goal of housing a son or daughter for the duration of their studies, and then flipping the investment for profit. It can be lived in by the family into the foreseeable future. Or any of these lucrative properties can be held on to, and rented out year after year for the throng of passing students always looking for temporary housing. The turnover of renters, and neighbourhood desirably  makes it equally easy to rent, sell, or live in the area.

This student turnover explains the high mobility of residents in the neighbourhood of Stratchcona. According to municipal census statistics, about 30% of residents had lived at the same address for 5 years or more, with 7 out of ten having moved within 3 years or less.

Row Housing near campus. Image Credit: University of Alberta

The area of residences near the University is considered to by part of the larger Edmonton neighbourhood, Strathcona. This historic area is quite old by Edmonton standards, around 15% of residences were built before 1946 and just over half were built in the 60’s and 70’s. This explains the eclectic architectural vibe of the neighbourhood and provides a wide array of housing options for interested potential residents. Around 44% of area homes are low rise apartment buildings, ideal for thrifty first years on campus. Approximately 24% of the area is comprised of single family dwellings, beautiful homes for the family or a comfortable, spacious retirement.

Saskatchewan Drive walking trail. Image Credit: University of Alberta

The University area’s desirability also has to do with it’s ample amenities. Designed as a neighbourhood for students with limited to access to their own transportation, almost every necessity is in walking distance, including grocery, restaurants, laundry, Edmonton’s popular Whyte Avenue district, multiple theatres, and of course all the buildings on campus. As well,  the University’s transit centre is a main hub for bus and LRT services to all access all parts of the city.

Click here to view properties in the University area. 

The town of Gibbons lies about 30 minutes away from Edmonton to its North-East, situated on the Southern banks of the Sturgeon River. Just over 3000 people reside in the almost 7.5 square kilometres that make up the town. Though comparatively a very small community, it is by no means isolated, considering its proximity to Bon Accord, Namao, Fort Saskatchewan, Redwater, and Morinville. Not to mention the short drive to Edmonton, if the amenities of a larger city are necessary.

Restored Photo of the Gibbons Grain Elevator. Image Credit: Shaun Merrigan via Flikr

The small town is quite old by Alberta standards, and rich in history, as their official website will boast to you. In 1892 William Reynolds Gibbons, an adventurous pioneer, settled the area along with his wife and three kids. Apparently the group was headed for Edmonton but extenuating circumstances (induing the railroad being incomplete as of yet) fated them to start their own settlement, aptly taking the family name ‘Gibbons’.

Image Credit: City of Gibbons

The town, since its very roots, has been a family oriented community and carries on this tradition into present day. This means a focus on recreational and community activities, with a whole host of programs dedicated to children and youth. Not to be overshadowed, there is also a strong arts and cultural presence to delight children and adults alike.

According to the town’s extensive website:

Residents and visitors can fish for trout in the stocked fish pond, take a walk along the river valley, share a picnic in the park or just enjoy the unmatched scenery. Watch history come alive when you visit the Gibbons Museum or visit nearby Jurassic Forest and spend some time with the dinosaurs.

Among the plethora of recreational facilities and activities, one sport rises above. Hockey is an increasingly focal point for the community’s youth, with the CNN Spurs minor hockey program in effect. This caters to all levels from initiation to midget, and includes a female program as well. All housed in the Gibbons arena, which is also home to many other teams, as well as a mens league. Adjoining the arena is the Gibbons Curling Club.

Gibbons Broncos Hockey Team. Image Credit: The Morinville News

Gibbons is also home to a cultural centre, which puts on many events throughout the year and even houses the municipal library. There is a town museum open in the summertime which “Celebrat[es] the local Pioneer history of Gibbons and the surrounding Sturgeon river area”.

Gibbons Museum Grounds. Image Credit: Gibbons Museum

There are two elementary schools in town, a junior high, and a learning centre focused on the high school level as well as adult education. There are multiple doctor and dental offices, a pharmacy, and a medical centre.

CLICK HERE To view properties available in Gibbons.

Just over 30 kilometres north of Edmonton lies the town of Morinville, Alberta. The 11 square kilometres that comprise the town are inhabited by almost 8600 residents. The 36 minute drive time to the city makes Morinville a desirable location due to this proximity, yet distance from larger centres. In the near vicinity are Namao, Bon Accord, Gibbons, and Legal.

Current Day Jean Baptiste Parish. Image Credit WinterforceMedia

By the late 1800’s French settlements had begun to arise in the area led by Father Morin, the town’s namesake.  Following this influx, a large group of German pioneers arrived, contributing heavily to the town’s unique French and German heritage. Many family lineages still exist today with prominent names such as Riopel, Labonté, St. Laurent, Maisonneuve, Bokenfohr, Krauskopf, Rustemier, and Meyers.  The settlement became official in 1894 upon the opening of its first post office, and shortly after in 1907 the St. Jean Baptiste parish was built.

Main Street Morinville in 1910. Image Credit: Morinville Museum

Always an economic frontrunner, Morinville opened one of the first Royal Bank locations (1910) and a credit union (1940) as well as the original location of Champion Pet Foods (now a world-wide exporter). Presently Morinville is home to many chain and locally run businesses, as well as 18 restaurants, salons and spas, veterinarian clinics, art and music supplies, auto shops, and every other amenity a resident could have need for.

Aerial View of a Morinville Street. Image Credit: Morinville News

The cultural diversity of Morinville’s residents creates interesting and exciting community events. With a highly bilingual population (French/English) even the Catholic church hosts an exclusively French mass on Sundays. There are festivals and events year round expressing a variety of cultural facets including a Jean Baptiste festival, the “In Our Community” Fair, Oktoberfest, and many more.

Here is a promo video for this years Saint Jean Baptiste Festival:

Due to the rural nature of Morinville, the area lends itself particularly well to recreational and outdoor activities. Along with extensive walking and running trails, the city has set up many clubs designed to specifically motivate and encourage recreation in a supportive and social environment. Additionally there is a trout pond, splash park, skateboard park, hockey arena, a curling rink, as well as new outdoor fitness areas.

CLICK HERE to view properties for sale in Morinville. 

The small community of Devon, Alberta, still considered a ‘town’ with a population of just over 6500, covers almost 12 square Kilometres of land southwest of Edmonton.  At about a 40 minute drive (26 KM) away, Devon provides an idyllic escape from city life.

Bridge at Devon, Alberta. Image Credit: Sean McCormick via flikr.com

Surrounded by agricultural communities, and residential sprawl from Edmonton, Devon is a hub of  not only shopping and amenities but is surrounded by world class golf courses and spectacular nature preserves.

By Alberta standards the town is relatively new, having almost sprung up overnight in the late winter of 1947. The Imperial Oil drilling company struck oil on the present day town site, and Devon developed to accommodate for the many site workers and staff necessary to maintain the drill. To this day the oil industry remains an important contributor to Devon’s economy.

Imperial Leduc #1 Oil Drill. Image Credit: Devon.ca

The Devonian Botanic Garden, facilitated by the University of Alberta, is a notable feature, and namesake, of the area around Devon known for its lush landscapes. The ‘Garden’ is in actuality over 190 acres of botany collections, indoor show houses, as well as an extensive trail system. Across the highway from the gardens lies the Clifford E. Lee Nature Sanctuary; nearly 350 acres of marshland, parkland, open meadows, and more. The varied terrain attracts a multitude of animal species, including over 100 varieties of birds.

The greenery around Devon is not only reserved for flora and fauna however, the Devon Golf and Country Club, as well as Blackhawk Golf Club are both found along the scenic Devon River. The Golf and Country club was also built in the interest of the early oil workers, to create a leisure time activity. As the sport escalated in popularity, it grew from a 9 to an 18 hole course.

View of the Devonian Botanic Garden. Image Credit: University of Alberta

Devon is appealing for those searching for a starter family home, or even more established buyers. The area is serviced by a general hospital, 3 public schools, 2 Christian academy, a Catholic School, and the Devon Dispatch newspaper.

CLICK HERE to view properties available in Devon.

Stony Plain, Alberta is a town located west of Edmonton within Parkland County. With less than a 40 minute drive to Edmonton and only 10 minutes from Spruce Grove, as well as many amenities of its own, Stony Plain has become a desirable area for those relocating from larger nearby cities.

The area was officially settled in 1892 by homesteaders Alex McNabb and John McPherson, however the origin of the name “Stony Plain” has been disputed. It is possible it relates to the Stoney people, indiginous residents of the area. Alternatively, it has been suggested it was named by geologists noticing the large amounts of scattered boulders in the area.

Main Street. Image Credit: Town of Stony Plain

Stony Plain’s population of around 15,000 spread over 36 square Kilometres make it one of the largest towns in Alberta, as it nears eligibility for “city” status.  However in relation to Alberta’s primary cities, this is a relatively low population count, allowing for a quality of life oft sought after in smaller communities.

Public Mural. Image Credit: 20@30

Stony Plain has an active arts community, and has been lovingly dubbed “The Town with the Painted Past” due to the large number of public murals splashed throughout the town. It also houses the diverse Multicultural Heritage Centre, which amalgamates the arts community with the town’s strong agricultural heritage. The centre offers many cultural programs, as well as an art gallery, and a museum.

Summertime in Stony Plain means plenty of festivals and celebrations including Farmer’s Days (including a parade, fairgrounds, and rodeo!), the Blueberry Bluegrass and Country Music Festival, and The Cowboy Poetry and Country Music Gathering.

Cowboy Poetry and Country Music Gathering

For those interested in raising families, the town is home to five schools, including private, public, and Catholic divisions as well as an outreach centre.  The Stony Plain Reporter and the Tri-Area News are local media outlets located in town, reporting predominantly on Stony Plain, and secondarily the neighbouring Spruce Grove. Additionally, Stony Plain also shares a recreation centre with Spruce Grove, the TransAlta Tri Laisure Centre.

Click Here to search for homes available in Stony Plain.