# Alberta Housing Prices (Up or Down?



## dixon7800 (Jun 25, 2015)

*Whats your prediction of how the Alberta market is going to go in the next couple years? * 

Factors: 
- Oil is down
- NDP is in power
- Workers for the oil companies have been getting laid off (many of my friends and family have been)

Im looking to buy a house to live in for at least the next 10 years and im really close to having something built by a reputable builder in Edmonton.

I have 3 properties in total, 2 of which i bought at the wrong time and 1 that i am currently making money on to even it out. Although this next house is not a rental property i dont want to buy at the wrong time.

What are your thoughts on the housing market?


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## nobleea (Oct 11, 2013)

Who knows. I'd think the million$ plus market would probably not be a good place to be, particularly in Calgary. Anything 500K and under seems to be moving fast still. Even with these layoffs, alberta still have a very low unemployment rate. Rental vacancy is in the low single digits in both big cities (~2% in calgary).

If you are building new, I don't know how much your price would change. A builder has to recoup their cost, whereas an existing home owner can afford to lose some equity. It would take at least a couple years to see any real drops in new home prices.

If you're planning on staying there 10yr+, who cares. if you need a house and you can afford it, what difference does it make if you paid 5% more/less? It's a place to live.


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## Butters (Apr 20, 2012)

I don't think prices will drop too much, even if they do, only like 10%
if you're holding for 10 years, it should be + by then! minus the fees associated with buying, interest on mortgage, and selling  but hey *you need somewhere to live*!
I'd say 3% per year

you're not going to get rich buying a house... I see housing as rather a forced savings plan... 
http://www.fool.com/investing/gener...home-is-not-a-great.aspx#.U2YYnaug2L0.twitter

if you can sacrifice other needs, you can save much more money... Stock market outperforms housing... but again... *you NEED SOMEWHERE TO LIVE*

sometimes you can get lucky on developed houses, where they give you a deal for being first one in, when its fully developed suddenly everyone wants to be in that community

its cheaper to buy a house beside a mudzone, wait for the other houses to pop up, then sell in a developed area  and you get the free granite upgrade 


I'm just renting in Edmonton, own a house in Winnipeg, where I wish to move back once school is finished!
Not interested in buying in Edmonton, may buy another in Winnipeg in the future


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## Just a Guy (Mar 27, 2012)

It depends on how tight things get. If money gets tight, the sellers will have to blink and take a "loss" (at least a paper loss), but I haven't heard much news anywhere that says the market is willing to blink...yet. 

The market across Canada is high, Alberta has a lot of money in it, so it's probably more insulated than other parts of the country...that being said, they also tended to spend it more.

Now, if interest rates start to rise...


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## peterk (May 16, 2010)

Layoff have not been happening in significant numbers in the professional sector, yet (except for Coffey). Mostly the trades and oil services industry. I'd wager that a higher percentage of professionals than trade workers are homeowners in Alberta, as they are generally here longer term than many trade workers who are going on the 2 year plan. What happens when the professionals start losing their jobs? and their second home goes vacant because the trade worker was their renter?

I am not even thinking about touching Alberta real estate right now.

Also, Boomers in Alberta are/will be retiring. Alberta boomers are highly paid compared to elsewhere's boomers. These guys have worked in Alberta for 20-30 years, and are ready to cash out. How many are going to retire IN Alberta and stay here? Far less than other provinces for sure. How many have taken their high earnings from the past decades and put them into a 2nd or 3rd house? Lots. You are looking at an exodus of highly paid people who are about to stop spending in the Alberta economy, and unload their properties at the same time.

Nope. I'm waiting this one out.


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## nobleea (Oct 11, 2013)

peterk said:


> I am not even thinking about touching Alberta real estate right now.
> 
> Also, Boomers in Alberta are/will be retiring. Alberta boomers are highly paid compared to elsewhere's boomers. These guys have worked in Alberta for 20-30 years, and are ready to cash out. How many are going to retire IN Alberta and stay here? Far less than other provinces for sure. How many have taken their high earnings from the past decades and put them into a 2nd or 3rd house? Lots. You are looking at an exodus of highly paid people who are about to stop spending in the Alberta economy, and unload their properties at the same time.


Alberta is the youngest province and has the lowest percentage of people above 65. For sure the boomers are retiring but there's a lot less of them. Much has been written about the great crew change in the oil industry and we are certainly seeing the start of that. Someone has to replace all those professionals that will be retiring, and those are the ones that will be buying the boomers homes. There's a reason why engineering schools have vastly increased their enrollment and you still dont see high unemployment amongst new grads.


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## Karlhungus (Oct 4, 2013)

First of all, "reputable" builder? Can I ask which one you think is reputable? Most new builds i see are nightmares, doesnt matter who the builder is. 

I think here in Edmonton for 2015, we will be lucky if prices stay flat. We didnt have the run up in prices that Calgary did and it seems people are just sitting back waiting to see what will happen. If oil can rebound to $75+ per barrel, expect house prices will start to appreciate 3-5% per year. Just my 2 cents.


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## banjopete (Feb 4, 2014)

I think in Alberta the thing that will sustain is the influx of workers from elsewhere in the country chasing typically higher paying jobs. There are lots of things in play here of course beyond just migration but with a growing population and ever increasing commute times homes in central neighbourhoods will hold their value over the long term. As long as you're in it for 10 years I'd say you won't lose your shirt but I'd second the opinion of perhaps thinking beyond unbuilt home and look at more central established neighbourhoods for value preservation. My thinking is that if you buy a brand new home these days and want to sell it why would a "new home" buyer look at a used new home when they can get "all they ever dreamed of" in a brand new home for themselves. I see the deep burbs as a hell I wouldn't wish on anyone and a place of very little property appreciation and think of multi-hour commutes when it snows big, and if you think I'm kidding ask around. Last year friends moved to St. Albert and worked near the university farms, on a big snow dump day, and after 3 hrs driving, one gave up and walked half an hour the rest of the way to work.


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## fraser (May 15, 2010)

Not certain. A friend of ours, an engineer, recently sold and moved out. His comment was that there would be no work for him for 2 years. The Professional Engineering ***. just announced that just over 1000 engineers were out of work. I can easily believe this.

We are currently renting but we are watching the market. What we are seeing in the segment that we are watching $500-800K is that prices are steady BUT our cut has gone from 8 homes to 27 homes. We saw one in December...it is still for sale, same price, but empty. We are noticing more empty properties on the market via MLS descriptions. Only three or four have sold in the past four months-and this is prime time.

I suspect we will see some price decreases after Stampede and then again in the post Oct. timeframe. The CREB stats are somewhat misleading. We are going away for a few months and will look at the market again in Oct. Until then we are happy campers. We have made substantially more by selling our home three years ago and putting it in the market than we would have if we had kept the house. The freedom of not being tied down to a large asset that needs TLC is wonderful! One thing for certain, condo and apt. prices are down.


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## scorpion_ca (Nov 3, 2014)

The prices of the houses in Calgary NE area are crazy. Most of the good houses are sold within three days and the prices are $5-$15k less than asking price. However, my sister offered more than $1,100 of asking price but did not get the house.


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## Sm5 (Nov 2, 2014)

I'm expecting either a drop or more likely, price stagnation. Its an unusual market as it seems both buyers and sellers are 'waiting' neither willing to make the first move and raise their offers or drop prices. From what I've seen prices are stagnant but volume is way down. I expect a 10% drop at most and, realistically, that prices sit within +-10% of current for a few years until earning power can inflate enough to allow for larger monster mortgages (since most people can't qualify for much more than they already are taking on).

With that said, a deflation in condos (at least in Edmonton) appears likely to me based on the new rental and condo capacity that is coming 'on tap' in the next 2 years.

Based on this (very arbitrary) reasoning, I'm holding off purchasing and continuing to rent. Very interesting times we live in...


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## banjopete (Feb 4, 2014)

Just a quick poke at the Edmonton real estate board "statistics" shows in comparison 2014 to 2015, for SFH avg days on market up by 4 days to 28 days, avg sale price -1%, total sales ytd -16% and listing ytd +125%.

Having just been through the experience myself prices in the "right" neighbourhoods, at and around the city average sfh price had lots of interest, and sold quickly. People hoping to make a big profit on chincy flips were pretty obvious and had big days on market numbers. We visited many homes within a day of listing that had offers pending already. Rightly or wrongly for those accessibly priced homes there continues to be buyers, and in the mature neighbourhoods anything in rough shape where people just want out will be swallowed by developers. 

I'm seeing lots of infill and skinny home development happening where old teardowns are being bought for $350k-$400k and two skinny homes are put in their place in the $700-$850k range. We looked extensively in Westmount and this was the fate of anything remotely cheap with the larger lots in there.

We did just buy somewhat against my wishes for all the reasons mentioned here, I would have preferred to wait longer but we bit on a good home, in a good neighbourhood, and don't plan on moving anytime soon. Will it be a good choice ultimately? I hope so but I look at homes like a liability and less an asset so I'll be happy if we don't lose money on it.


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## Freedom45 (Jan 29, 2011)

In the area we're in, just outside of Edmonton, prices don't seem to have slipped at all, and well presented, correctly priced homes seem to be selling pretty quickly. Some homes seem to be sitting, but they all either to appear to be overpriced (people trying to cash their chips in before a crash?) or poorly shown (messy, poorly maintained, etc).


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## Feruk (Aug 15, 2012)

As someone who works as a professional in oil and gas in Calgary, I have something of a unique perspective. So far we've seen companies reduce 5-20% of their professional staff. The underlying assumptions have been ~$75/bbl Canadian by year end and that next year companies would be back to sustainable drilling. Not only is this assumption pretty much out the window, but the popular belief has started to shift toward a slump lasting 5+ years. When companies put together their 2016 budgets, you can expect a truly bloody fall. I wouldn't be at all shocked by a 30-40% reduction of professional jobs (compared to last September) by year end. These are the people holding the large mortgages, not the people with "jobs" we've created recently that barely pay minimum wage. As has already been pointed out, Alberta's work force is relatively young and doesn't have the savings to sustain themselves for a long slump. Due to a dislike of renting, we've had years of new grads jumping straight into home ownership and living house poor. I think we'll finally see that come to a head.

Basically, we haven't seen anything yet. It'll take time for people to get desperate, but once they do, it'll make 2008 look good.


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