Here's the August 2023 St. Albert real estate market update. Sales continue to be low compared to 2022, with only 102 sales in august of 2023 compared to 118 in August 2022. That's a 15% decrease. Year to date sales are down 17% so while the St. Albert real estate market is softer than it was last year, it's stronger than it was earlier in 2023. 

The average sale price is up though, which is a nice stat to see in St. Albert. Prices are up an average of 4.4% year over year, which the year to date prices are down 2%. This means that recent months have been much stronger for property values than earlier months of the year. In August 2023 the average sale price of St. Albert real estate was $460,000. 

It is still taking longer to sell a home in St. Albert than it was a year ago, taking on average 52 days compared to 38 days a year ago. 

Click here for the report.

Alberta’s population is on track for the fastest growth the province has seen since 1914. Statistics Canada released the first quarter 2023 population statistics, reporting approximately 51,000 people moved to Alberta between January and March of 2023. A third of those coming from other Canadian provinces.

“The most expensive cities, Vancouver, Toronto, I know Vancouver’s hitting record rates for rents. So a lot of people are getting priced out of those big cities, and are looking for more affordability, so they may be migrating to cities like Calgary and Edmonton because they’re a little bit more affordable,” said Crystal Chen, a spokesperson with Zumper.

Rental prices for a one bedroom apartment in Edmonton have increased 13 per cent since last year. In Calgary, the same apartment has increased 32 per cent.

Chen says that housing costs will continue to rise as demand increases, and has tips for those moving to Alberta with the intention of finding a rental.

“Winter months are the best times, that’s typically when property managers price units at lower rates to fill vacancies before the holidays. And if you can, offer to sign a longer lease, landlords like that and you can lock in a rate for a longer time instead of bouncing around every year when rents may be going up,” said Chen.

Housing costs aren’t the only thing to consider as Alberta’s population booms. Professor of economics, Moshe Lander says that while the growth is proof of an attractive province, a concern could be the infrastructure of Alberta’s major cities.

“The not necessarily good news is that public services and infrastructure are not keeping pace, or are not prepared for that influx. So over time, and I mean in the next 5 to 10 years, this could potentially be a problem,” said Lander.

Lander says that with a rapidly increasing population, Edmonton and Calgary should plan for rapidly increasing infrastructure costs as well.

“The costs rise not linearly, they rise almost exponentially. To link up the outer regions of Edmonton to the center requires a lot more investment than hooking up, say, the adjacent downtown part of Edmonton,” said Lander.

“So there is a point where it’s going to become a problem, and I were the mayor of Winnipeg, I’d be rubbing my hands together saying, in about 10 years, if they don’t figure it out, I’m going to make a move to grab Albertans telling them to come to the east end of the prairies.”

This article originally appeared at https://edmonton.citynews.ca/2023/06/29/alberta-population-growth/ by Bianca Millions on June 29 2023.

More Canadian homeowners have opted for shorter-term mortgages in recent months, according to a new report, setting the stage for a large and potentially dangerous wave of renewals in a couple years’ time.

While five-year mortgage terms are typical, customers at Canada’s largest banks have recently been electing to sign up for shorter durations, likely in the hope that sky-high interest rates will be lower in the coming years, giving them a chance to refinance at a lower rate sooner.

It’s a trend worth watching, according to a report from RBC published last week, because if interest rates remain stubbornly high when these mortgages come up for renewal all at once — existing five-year mortgages along with the new, shorter-term loans — it could mean another big hit for household finances.

Homeowners have been struggling with rising rates for months and Statistics Canada said Tuesday that higher mortgage interest, which rose by more than 30 per cent in July year-over-year, was the biggest single contributor to the country’s annual rate of inflation ticking up more than expected last month.

“Many Canadian banks have recently seen a trend of customers choosing to renew their mortgages for two- or three-year terms as opposed to the most common five-year term given high interest rates,” according to the RBC report by analyst Darko Mihelic (the report was reissued Monday with a correction to certain estimates related to bank dividends).

Mihelic said mortgages set to mature within two to five years increased from the end of 2019 to the beginning of 2022, which is roughly when the Bank of Canada began its interest-rate hiking cycle in a bid to combat inflation.

Since then, mortgages in the two- to five-year maturity range have decreased while those set to mature within one to three months and one to two years have increased as a proportion of total residential mortgages.

“All in, we are seeing a shift in the duration of the mortgage portfolio and more and more mortgages will be maturing in 2025 and 2026 as a result,” the report said, adding it will be “worthwhile following this development, particularly if interest rates do not start to decline next year.”

“Hopefully interest rates will have (meaningfully) decreased before this event occurs as many borrowers will face meaningful mortgage payment increases should the current rate environment persist.”

Mihelic’s comments on the mortgage trends were part of a preview of the big banks’ third-quarter financials, which they are set to report beginning Aug. 24.

The RBC analyst said he expects earnings per share at TD, BMO, CIBC, Scotiabank and National Bank to decrease on average by about six per cent year-over-year (Mihelic doesn’t cover his employer).

He noted that a major factor in the expected decline is a drop in mergers and acquisition activity, leading to lower bank revenues.

Canada’s big banks are expected to face pressure to rein in costs later this year, Mihelic said, and they are also grappling with ongoing demands by regulators to set aside more capital as a buffer against challenging macroeconomic conditions.

This article was originally published in the Toronto Star at https://stocks.apple.com/Am6vX9P2lSQafUg3xsUpq3A

Sales are up in July by 4% compared to last year, not a big change but for a year that's seen a consistent negative slide... a positive change is a big deal. 

New listings are down a whopping 21%. That's huge; low inventory drives eventual price increases and we're seeing an inventory crunch. 

Finally the average sale price is down 1%, a nominal figure. Again, for a year that's seen consistent decreases, it's shocking to see prices almost back to par with where they were before the interest rate increases started. 

What we haven't seen yet is price spikes; but I believe they're coming soon. In fact, they're already starting but the stats are still recovering from a very soft start in 2023. By year's end, I expect that house values will be higher than they were a year ago. 

2023 has been a tough year for the Edmonton Real Estate market, but we're seeing signs of life. If you've been reading this blog through 2023 you've heard me say that Edmonton's real estate market follows the same pattern as the Calgary market; but just a few months late. 

Calgary is in a full-on boom, brought on by low inventory and a lot of people from BC and Ontario are eyeing the Alberta markets as good investment opportunities. Based on the delayed reaction in Edmonton vs. Calgary, we should now be seeing a surge in sales, a drop in available inventory, and a rise in property values.

Sales are up 19% compared to July 2022 and inventory is down 5.5% (-17.75% year to date). 

That data supports the argument that the Calgary trend is coming to the Edmonton real estate market. But we haven't seen price increases yet, infect prices are down 6.5% year to date, and are 3.58% lower than they were this time last year. But that does mean that over the past 2-3 months prices have started to rally, just not enough to overcome the drop that happened in early 2023. 

Time to sell remains high, at 70 days on average, but again that's getting tighter as we move through 2023. 

The average home sale in July 2023 in Edmonton was $385,000. 

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