Here we go 2020! I attended the 2020 Edmonton Realtors Association Housing and Economic Forecast this past Wednesday morning. I love this yearly event! Great chance to talk real estate, review the recent past, and look into the year to come. This year was great and informative as expected.
The MC, Canadian Comedian Steve Patterson, was back for his second year and did a great job. The speakers included the Senior Economist City of Edmonton, Chief Economist of the Alberta Treasure Board and Finance, Vice President of Edmonton Global, President and CEO of the Realtors Association of Edmonton, and the Current Chair of the Realtors Association of Edmonton. All these very well spoken and knowledgeable individuals had lots to say! This is a great event in understanding the Edmonton and greater Area Real Estate Markets including Fort Saskatchewan, Sherwood Park, St Albert, Leduc, Stony Plain, Spruce Grove, Morinville, and surrounding counties and towns.
If you are ready to talk real estate let me know! Contact Jarett Johnson
Summary of 2019
- Average Price in 2019 All Residential: $360,262
- Total New Listings in 2019: $42,959
- Total Sales Reported in 2019: $20,079
- Total Sales Volume in 2019: $7,201,367,293
Summary of 2020 Forecast*
- Average Price 2020 All Residential: $361,703
- Single Family and Condo Sales Change: +0.6%
- Duplex Sales Change: +1.4%
- Stable Market for 2020
Real Estate in 2019
The market was busy in 2019. However only about 47% of listed properties reported Sold. This created a very unique buyers market with steady prices. A quality home in a good location was selling for above market value, and on all else, had to make concessions on price and terms.
Housing starts in 2019 exceeded the City of Edmonton’s forecast by about 600 new housing starts to reach approximately 8600. The majority of which are multiple family housing projects (which includes everything outside of new single family homes). This was boosted by a strong fourth quarter.
The City of Edmonton research suggests we see a real 1.4% growth in GDP across our region and forecast an expected 2% growth in Real GDP for 2020. This is positive news that is crucial for spending power. The long term forecast suggest 2-2.5% after 2020.
Real Estate in 2020
Having listened to knowledgeable economic experts and taking into account their various perspectives on the economy, I believe we will see a very stable market in 2020 with very little change in average price. The Realtors Association is predicting an average single family home price of $425,068; condo average price of $228,339, and duplex/row house average price of $334,476. This numbers all represent a very small increase from 2019.
The Realtors Association of Edmonton predicts a decrease in single family listings by 0.2% which would help stabilize prices. They also predict an increase in condo listings by 1.1% and duplex listing increase by 0.4%. My gut is telling me we see an increase in listing right across the board with an average of 0.5%.
Single family home sales have been on the decline since 2015. Year over year there have been 100 + less homes selling in the YEG. The Realtors Association of Edmonton is predicting an up tick here by 75 homes. Short answer is – no changes. Marginally up or down will equate to a very stable market.
Inflation and Population Growth
Inflation is projected at another stable 2% increase into 2020. We are also looking at a population grown in the Edmonton region by about 30,000 in 2020 with the majority of this growth coming from natural increases and international movement through immigration. In 2016 and 2017 we’ve actually seen an interprovincial net decrease (people moving out of Alberta to another province versus them moving to Alberta). With a very slight increase in 2018 and proving to be a more significant increase in 2019, we can expect further growth as we have experienced in the past in 2020. We should not expect the same massive growths we’ve seen in 2013 and 2014 from other provinces but growth nonetheless.
Speaking of the Edmonton and area population! Did you know the Edmonton and area has a very young and educated work force? The average age of Canadians is 41 years of age. The average age of Albertans is 37.8. The average age of Edmontonians is 37.7. We have the best schools, hospitals, and people. Combine this with the 15th highest and very affordable housing market in Canada, and no wonder people want to live in the Edmonton region and invest in housing and their families.
MLS Stats, Vacancy Rates, and More
Through the Realtors Association of Edmonton there were 42,959 new listings added to the system in 2019. Out of that, 20,079 sold properties were logged at a total sales volume of over $7 BILLION! 2019 was a year for the buyer with only 46.7% of listed properties selling in the YEG.
Unemployment is still an issue in Edmonton and the rest of Alberta. The main problem is the growing work force that is growing faster than the supply of jobs. Especially for individuals younger individuals in our region. As of December 2019 the Edmonton region was at approximately 7% unemployment with a growing labour force. One key note is that with our growing population and work force one of the sectors that is expected to see gains is the service sector.
Here is another stat that I found interesting! Estimated vacancy for Commercial Real Estate is at 20% – Great time to purchase commercial real estate on the cheap however lease values are low. Purchase values are extremely low and interest rates are attractive. Over the long term when lease rates become stronger, the potential is massive.
If you are looking to make a move in 2020, planning your real estate activity for the future, or need to understand your real estate investment, your home; it’s time to give me a call! Feel free to call, text, or email me anytime.
Jarett Johnson Real Estate
To Learn More about EDMONTON GLOBAL check out their website. I found this new Edmonton corporate structure fantastic and extremely interesting. Their main goal is to sell the Edmonton region to the global marketplace. Here is the package they provided – click here.
*Forecast and statistical information courtesy the RAE (Realtors Association of Edmonton – the 2020 Housing Forecast Seminar) https://www.raehousingforecast.com/2020-forecast-package