Real Estate

Edmonton Real Estate Market

  • Last Updated:
  • Apr 9th, 2020 7:34 pm
[OP]
Newbie
Feb 7, 2019
82 posts
28 upvotes

Edmonton Real Estate Market

I haven't seen much discussion of the Edmonton real estate market in this forum. Alberta is going through a rough patch now, but does that mean that buying real estate for investment in Edmonton is a bad idea? Or is that an opportunity, given that there is choice and prices have been flat since 2014?
What do you think?
30 replies
Deal Expert
Aug 2, 2001
16555 posts
6688 upvotes
Oil prices are significantly lower than anticipated by the government in Alberta which may lead to further cuts to provincial spending (because the government has indicated that was their plan before these even further depressed prices). This will likely lead to losses in the job market, and Edmonton is more at risk than Calgary being the capital.

I would expect the next couple years at least will be tight times, economically, for residents of Edmonton.


How this will affect real estate I will leave to others. But things seem poised to get worse before they get better.
Deal Fanatic
Feb 9, 2009
9178 posts
6744 upvotes
Edmonton needs to start diversifying into other industries like tech.

Oil is an industry that will kinda always be there but will continue to go down in demand as the years go on.
Deal Expert
User avatar
Oct 26, 2003
33865 posts
3782 upvotes
Winnipeg
TrevorK wrote: Oil prices are significantly lower than anticipated by the government in Alberta which may lead to further cuts to provincial spending (because the government has indicated that was their plan before these even further depressed prices). This will likely lead to losses in the job market, and Edmonton is more at risk than Calgary being the capital.

I would expect the next couple years at least will be tight times, economically, for residents of Edmonton.


How this will affect real estate I will leave to others. But things seem poised to get worse before they get better.
I was under the impression that Calgary RE market dropped more than Edmonton, not the other way around like you are claiming. At one point Calgary downtown had 50% office vacancy and the RE dropped by around 30%.
Banned
Feb 19, 2020
17 posts
25 upvotes
Here are the negatives/risks/factors that I am considering right now:

* Unemployment in Edmonton is very high and is continuing to climb higher.
* 19K jobs were lost in Alberta last month.
* The UCP party is making cuts to public sector (healthcare, schooling, etc, etc).
* The UCP party cut government investment in the tech industry, etc.
* The UCP party gave big tax breaks to the oil and gas companies which is generally viewed around here as a waste of $4B.
* There is a global glut of cheap oil which is keeping oil prices depressed for the foreseeable future. US has tons of oil now. Producers are cutting back.
* In the long term oil and gas will decline as there's a global push towards other energy sources.
* Protesters are handicapping oil and gas sector in Canada right now and the governments are giving in and pandering to them. This is likely to continue.
* Coronavirus has further caused oil prices to drop by shutting down China's economy. This impact could last months or years depending on how long the outbreak lasts and how far it spreads - hard to predict.
* The UCP appears to be missing their planned budgets due to oil prices being further depressed and way below what they had estimated. This may require more cuts.
* Planned oil and gas projects such as Teck will likely be on hold for years, even if approved, due to low oil prices.
* Alberta didn't diversify our economy in the good years so we don't have much going for us other than oil and gas and the fact that lots of people live here without jobs.
* Alberta has a terrible climate so, without energy sector growth, we could see our population growth stop or slow, which would put downward pressure on our housing market.
* There is tons of land around Edmonton for new housing sprawl to continue.
* Crime is high in Alberta right now. Police and courts are failing to curb it so it will probably continue.
* Many neighborhoods in Edmonton are seeing huge demographic shifts and turning into slum-like neighborhoods where property values are lower because nobody wants to live there. You would need to be very careful about what neighborhoods to buy in, in my opinion.
* There is a risk that Coronavirus becomes a global pandemic causing a global recession. It's hard to predict how this might affect housing. If the virus ends up killing millions, that could cause downward pressure on housing.
* There is a risk in the US election. The US has huge political polarization and there will likely be very big policy changes if Trump is not re-elected. Canada's outlook is definitely impacted by the US.
* The Canada-wide housing market is near peak levels again. If it declines for whatever reason, that would likely further negatively impact Alberta's housing.
* Luxury housing, say $1M+ for Edmonton, is not doing well. It seems to me that we could see further price compression.
* If the pain continues in Alberta, we might see some nice foreclosures coming to market. People can last a couple years on EI, savings, etc.

All considered, it seems probable to me that things will get worse before they get better, but it's very hard to predict the future. It could turn out that all the pessimism is unwarranted and the economy rebounds quickly and right now was the best time to buy. It's really hard to know if you have an accurate view or if you are biased in one direction or the other. Winter is depressing out here so people tend to be more negative. It's hard to time the bottom. I don't like catching falling knives, either.

I live in Edmonton and am looking to buy a house. I have been waiting for the last 6 years. My current thought is if I see an ideal house (since I am quite picky) I will go for it, but otherwise I'm not in a rush to buy right now. It's risky because I might not be able to find another job quickly if I were to get laid off.
[OP]
Newbie
Feb 7, 2019
82 posts
28 upvotes
ubermon wrote: Here are the negatives/risks/factors that I am considering right now:

* Unemployment in Edmonton is very high and is continuing to climb higher.
* 19K jobs were lost in Alberta last month.
* The UCP party is making cuts to public sector (healthcare, schooling, etc, etc).
* The UCP party cut government investment in the tech industry, etc.


* The UCP party gave big tax breaks to the oil and gas companies which is generally viewed around here as a waste of $4B.
* There is a global glut of cheap oil which is keeping oil prices depressed for the foreseeable future. US has tons of oil now. Producers are cutting back.
* In the long term oil and gas will decline as there's a global push towards other energy sources.
* Protesters are handicapping oil and gas sector in Canada right now and the governments are giving in and pandering to them. This is likely to continue.
* Coronavirus has further caused oil prices to drop by shutting down China's economy. This impact could last months or years depending on how long the outbreak lasts and how far it spreads - hard to predict.
* The UCP appears to be missing their planned budgets due to oil prices being further depressed and way below what they had estimated. This may require more cuts.
* Planned oil and gas projects such as Teck will likely be on hold for years, even if approved, due to low oil prices.
* Alberta didn't diversify our economy in the good years so we don't have much going for us other than oil and gas and the fact that lots of people live here without jobs.
* Alberta has a terrible climate so, without energy sector growth, we could see our population growth stop or slow, which would put downward pressure on our housing market.
* There is tons of land around Edmonton for new housing sprawl to continue.
* Crime is high in Alberta right now. Police and courts are failing to curb it so it will probably continue.
* Many neighborhoods in Edmonton are seeing huge demographic shifts and turning into slum-like neighborhoods where property values are lower because nobody wants to live there. You would need to be very careful about what neighborhoods to buy in, in my opinion.
* There is a risk that Coronavirus becomes a global pandemic causing a global recession. It's hard to predict how this might affect housing. If the virus ends up killing millions, that could cause downward pressure on housing.
* There is a risk in the US election. The US has huge political polarization and there will likely be very big policy changes if Trump is not re-elected. Canada's outlook is definitely impacted by the US.
* The Canada-wide housing market is near peak levels again. If it declines for whatever reason, that would likely further negatively impact Alberta's housing.
* Luxury housing, say $1M+ for Edmonton, is not doing well. It seems to me that we could see further price compression.
* If the pain continues in Alberta, we might see some nice foreclosures coming to market. People can last a couple years on EI, savings, etc.

All considered, it seems probable to me that things will get worse before they get better, but it's very hard to predict the future. It could turn out that all the pessimism is unwarranted and the economy rebounds quickly and right now was the best time to buy. It's really hard to know if you have an accurate view or if you are biased in one direction or the other. Winter is depressing out here so people tend to be more negative. It's hard to time the bottom. I don't like catching falling knives, either.

I live in Edmonton and am looking to buy a house. I have been waiting for the last 6 years. My current thought is if I see an ideal house (since I am quite picky) I will go for it, but otherwise I'm not in a rush to buy right now. It's risky because I might not be able to find another job quickly if I were to get laid off.
Very thoughtful piece. Thanks.
I was wondering if there is a different dynamic between condo and detached houses market?
Deal Addict
User avatar
Dec 13, 2016
3422 posts
2863 upvotes
Property taxes.... They will be going up for sure....
Banned
Feb 19, 2020
17 posts
25 upvotes
I don't know much about condos, not interested in them personally.

Property taxes always go up every year. I'm guessing it's probably like that everywhere, or do all the municipalities around Edmonton area just suck?

Alberta may sooner or later have to add a PST to resolve their budget problems.
Deal Expert
User avatar
Oct 26, 2003
33865 posts
3782 upvotes
Winnipeg
ubermon wrote: Here are the negatives/risks/factors that I am considering right now:

* Unemployment in Edmonton is very high and is continuing to climb higher.
* 19K jobs were lost in Alberta last month.
* The UCP party is making cuts to public sector (healthcare, schooling, etc, etc).
* The UCP party cut government investment in the tech industry, etc.
* The UCP party gave big tax breaks to the oil and gas companies which is generally viewed around here as a waste of $4B.
* There is a global glut of cheap oil which is keeping oil prices depressed for the foreseeable future. US has tons of oil now. Producers are cutting back.
* In the long term oil and gas will decline as there's a global push towards other energy sources.
* Protesters are handicapping oil and gas sector in Canada right now and the governments are giving in and pandering to them. This is likely to continue.
* Coronavirus has further caused oil prices to drop by shutting down China's economy. This impact could last months or years depending on how long the outbreak lasts and how far it spreads - hard to predict.
* The UCP appears to be missing their planned budgets due to oil prices being further depressed and way below what they had estimated. This may require more cuts.
* Planned oil and gas projects such as Teck will likely be on hold for years, even if approved, due to low oil prices.
* Alberta didn't diversify our economy in the good years so we don't have much going for us other than oil and gas and the fact that lots of people live here without jobs.
* Alberta has a terrible climate so, without energy sector growth, we could see our population growth stop or slow, which would put downward pressure on our housing market.
* There is tons of land around Edmonton for new housing sprawl to continue.
* Crime is high in Alberta right now. Police and courts are failing to curb it so it will probably continue.
* Many neighborhoods in Edmonton are seeing huge demographic shifts and turning into slum-like neighborhoods where property values are lower because nobody wants to live there. You would need to be very careful about what neighborhoods to buy in, in my opinion.
* There is a risk that Coronavirus becomes a global pandemic causing a global recession. It's hard to predict how this might affect housing. If the virus ends up killing millions, that could cause downward pressure on housing.
* There is a risk in the US election. The US has huge political polarization and there will likely be very big policy changes if Trump is not re-elected. Canada's outlook is definitely impacted by the US.
* The Canada-wide housing market is near peak levels again. If it declines for whatever reason, that would likely further negatively impact Alberta's housing.
* Luxury housing, say $1M+ for Edmonton, is not doing well. It seems to me that we could see further price compression.
* If the pain continues in Alberta, we might see some nice foreclosures coming to market. People can last a couple years on EI, savings, etc.

All considered, it seems probable to me that things will get worse before they get better, but it's very hard to predict the future. It could turn out that all the pessimism is unwarranted and the economy rebounds quickly and right now was the best time to buy. It's really hard to know if you have an accurate view or if you are biased in one direction or the other. Winter is depressing out here so people tend to be more negative. It's hard to time the bottom. I don't like catching falling knives, either.

I live in Edmonton and am looking to buy a house. I have been waiting for the last 6 years. My current thought is if I see an ideal house (since I am quite picky) I will go for it, but otherwise I'm not in a rush to buy right now. It's risky because I might not be able to find another job quickly if I were to get laid off.
Rent is cheap now, Alberta and Saskatchewan have rent drop by over 20% while rest of the country have rent increase by over 20%, which resulted in over all country rent increase of merely 1.6% ish according to the latest data.
Deal Expert
Aug 2, 2001
16555 posts
6688 upvotes
divx wrote: I was under the impression that Calgary RE market dropped more than Edmonton, not the other way around like you are claiming. At one point Calgary downtown had 50% office vacancy and the RE dropped by around 30%.
During the last big oil bust Calgary RE suffered tremendously. Edmonton had a more diversified economy and fared better.

However the government in Alberta is now actively cutting the public sector, which is a back bone of Edmonton's economy. Things are starting to look worse for Edmonton and I am personally not sure that people are going to be able to do as well during this series of cuts as they have in the past because oil prices so little sign of recovering soon, and the government shows many signs of accelerating cuts.
Deal Expert
User avatar
Oct 26, 2003
33865 posts
3782 upvotes
Winnipeg
TrevorK wrote: During the last big oil bust Calgary RE suffered tremendously. Edmonton had a more diversified economy and fared better.

However the government in Alberta is now actively cutting the public sector, which is a back bone of Edmonton's economy. Things are starting to look worse for Edmonton and I am personally not sure that people are going to be able to do as well during this series of cuts as they have in the past because oil prices so little sign of recovering soon, and the government shows many signs of accelerating cuts.
The public sector can only be immune to job losses for so long, they aren't outside of the economy.
Deal Addict
Nov 9, 2013
3872 posts
3543 upvotes
Edmonton, AB
Living in Alberta, my subjective belief is that our economy is worsening. This does not bode well for home prices. Prices in my area of Edmonton have actually declined ~5-10% since 2014.

Jobs have been lost (not added) this year as well, which is not a positive sign for rents.
Keep calm and go long
Deal Addict
Dec 4, 2016
1842 posts
871 upvotes
RE prices has been flat, while the primary export of the province has crashed in price, and there's a lack of pipelines to bring new oil to market. I would say prices are being sticky on its way down.
Deal Expert
Aug 2, 2001
16555 posts
6688 upvotes
divx wrote: The public sector can only be immune to job losses for so long, they aren't outside of the economy.
And that will cause more problems for Edmonton than Calgary.
Deal Expert
User avatar
Oct 26, 2003
33865 posts
3782 upvotes
Winnipeg
treva84 wrote: Living in Alberta, my subjective belief is that our economy is worsening. This does not bode well for home prices. Prices in my area of Edmonton have actually declined ~5-10% since 2014.

Jobs have been lost (not added) this year as well, which is not a positive sign for rents.
That has been the case for Saskatchewan as well.

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