The average price for residential real estate hit a new high in the Greater Edmonton Area (GEA) in May - $401,390, up 23% over the last year and the median price was up 8% to $375,000. Admittedly, averages can be very misleading, which is why the benchmark price is a much better indicator of what's going on in the market. The benchmark price for single-family homes was up 9.3% over last year in May, and the composite benchmark price was up 8.4%. As I already mentioned in our weekly stats, I believe the market peaked early this year in terms of listings and sales as many buyers moved their purchases up to take advantage of historically low-interest rates. While things are slowing down a bit, we are coming off of all-time highs, so there is still a ton of activity in our market. It's all about the inventory; the inventory is the measure of supply in our market, sales are the measure of demand, and the absorption rate represents how hot or cold the market is also known as a seller’s market or buyer’s market. We remain in a seller's market with 2.8 months of supply, but keep in mind different parts of the market behave differently - there are 16 months of supply of highrise condos on the market right now.  There are many leading indicators for the real estate market such as employment levels and net migration. But both of those indicators suggested we were in for a very slow spring. The best shorter-term indicator of what is going to happen in real estate is the inventory which is currently normal. Our weekly stats show new listings falling for three weeks, if that trend continues (as it normally would at this time of year) the inventory should remain in the normal range.  When you look at the market, year over year, there is a distinct cycle that occurs. We are currently in phase one, where sales and prices are both going up. You’ll notice sales will level out and then decline while prices continue to rise. Then prices will flatten out and finally start to decline. Sales trends are a leading indicator of prices. The last time the market peaked was in 2014, but prices continued to rise until partway through 2015. I expect prices will remain higher than last year at least through the summer. We know the cycle always happens, we just don’t know how long each phase in the cycle will last.  Things to be aware of…
  • mortgage rates are on the rise, as they climb, sales should cool
  • inflation is making everything more expensive, which may push prices up, especially for new construction
  • in an inflationary market, it is better to have assets like real estate than cash
  • our unemployment rate is still very high
  • if the vaccine works, people will start to travel and there will be less interest in local real estate. 
Here are all the details and trends:  

Edmonton Stats

The single-family home market in Edmonton is still very hot; there were a record number of single-family home sales in May (at least since I started keeping track in 2005). Single-family home prices also set a new record average price of $457,440 (the previous high was $457,041 in June, 2017). With interest rates rising, we expect to see things cooling off soon. Condo sales have already cooled off - 364 condos were reported sold in May which is roughly the same number we've seen for the last five years in May with the exception of last year which was extremely low due to Covid. I'll update this post with more details when the REALTORS Association of Edmonton releases their monthly report on the Greater Edmonton real estate market later this week. Posted by Liv Real Estate on
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Fantastic! Our economy, thanks to low interest rates, is starting to crush it! And next year should be ANOTHER white hot year as we continue to recover! Edmonton is soon going to be THE place to live in Canada. I think that we will be over $600,000 for an average detached by 2024.

Posted by Tom on Tuesday, June 1st, 2021 at 2:07am

[…] how I predicted just a few days ago that new listings would continue their downward trend for the remainder of the year. We normally […]

Posted by Weekly Market Update June 4/21 - The Edmonton Real Estate BlogThe Edmonton Real Estate Blog on Friday, June 4th, 2021 at 7:59am

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