Varcoe: Alberta's hot housing market is expected to soar through 2024

Content of the article

Alberta's housing market is heating up and there are signs that it will continue to tire in 2024.

Alberta home sales and prices will continue to advance at a rapid clip this year, two new reports examining the nation's real estate market outlook show.

Content of the article

According to a forecast released by the Canadian Real Estate Association (CREA), home sales across the country are expected to increase by 10.5 per cent this year, with Alberta leading the way.

Content of the article

Provincial home sales are expected to increase 13.6 per cent from 2023 before cooling off next year.

Alberta's median home price will rise seven per cent in 2024 to $480,000, the highest in the country, but below the national average of $710,000, up 4.9 per cent.

“It's a double-edged sword because if you're a homeowner in Calgary or Edmonton and your home makes more than you this year, that's great,” CREA senior economist Sean Cathcart said in an interview.

“But if you're a first-time home buyer, it's not so good when you're competing with people who have a lot more money than you.

“But the biggest home price growth in the country right now is in Calgary and Edmonton.”

Royal LePage's own report released Friday projects home prices in Calgary will rise to $717,000 by the end of the year, up eight per cent from last year, though slightly below the national average jump.

Home prices in Edmonton are expected to rise 6.5 per cent this year to $458,000.

Corinne Lyallbroker and owner of Calgary's Royal LePage Benchmark says sales in the local real estate market are “exciting” as most newly listed properties are snapped up quickly and inventory levels remain tight.

Content of the article

Content of the article

“I have many anecdotes about people who have tried to buy a house three, four or five times and have not been successful. It can cause a lot of anxiety.” Lyal said in an interview.

“It doesn't look like there's an end to it.”

Two reports show how Alberta's real estate market has accelerated even as high interest rates dampened demand in other parts of the country.

Earlier this month, an RBC study on housing affordability said Calgary is “Canada's current hot spot.”

Alberta continues to have the fastest-growing rents in Canada, with an 18 percent increase in rents for custom-built apartments and condos in the past year, according to a report from Rentals.ca.

The average monthly rent in the province rose to $1,728 in March, but remained below the Canadian average of $2,143.

The federal government is under intense pressure to find solutions to the housing crisis across the country and the cabinet has made a series of announcements ahead of Tuesday's budget.

Content of the article

Prime Minister Justin Trudeau unveiled a new housing plan Friday that will see the government build 3.87 million new homes in Canada by 2031.

Housing prices in Alberta are still below the national average, but as more people move to the province, residents are facing rising housing costs.

The province's population grew by more than 200,000 last year, easily outpacing the 35,000 new housing units built.

“Alberta is creating twice as many new homes as we can build or have ever built,” Alberta Business Council vice-president Scott Crockatt said Friday.

“For the number of new people moving here, there's going to be a big gap in the number of homes we need.”

Governments at all levels must ensure there is land for new homes, skilled labor to build them and timely permits to build facilities, Crockatt added.

Alberta's growing economy, strong job market and population boom are driving demand for homes across the province.

Content of the article

Although prices are rising, home prices remain relatively affordable compared to other provinces.

According to Cathcart, a single-family home in Alberta can be purchased for less than $500,000, compared to more than $1.2 million in Ontario.

“People are willing to move across the country to find affordable housing,” he added.

“Alberta is in the middle of this story right now.”

Asked about home prices in Alberta, Premier Danielle Smith said last week that the province is hearing stories of people buying homes in Edmonton and commuting to Vancouver every week.

“We certainly don't want to have the kind of housing crisis that we're seeing in Toronto and Vancouver, where most young people don't have access to housing,” Smith told reporters.

“We will certainly not allow this to happen.”

Royal LePage noted that Canadian home prices have not fully recovered from the correction in many areas, with prices down more than five percent from their peak two years ago.

Home sales across the province rose 26 per cent in the first three months of the year, while median prices rose 11 per cent, according to the Alberta Real Estate Association.

In March, listings fell by 25 percent compared to last year.

The pressure on the housing market that previously existed in Calgary is now being felt in other communities across the province, said Charles St. Arnaud, Alberta Central's chief economist.

“Strong growth, weak new listings, less inventory – that puts a lot of pressure on pricing,” St-Arnaud said.

“The force was more extensive across the province than before.”

Chris Varco is a columnist for the Calgary Herald.

[email protected]

Content of the article