The Canadian real estate market is facing new realities. The Bank of Canada’s (BoC) rising interest rates have made purchasing a residential property more expensive. Higher immigration levels will likely exacerbate the supply-demand imbalance. Rising inflation, higher borrowing costs, and growing labour shortages have made housing construction activity a bit more subdued. As a result of these new market realities, many households today are searching for different types of housing, particularly value-added properties and communities.
“Today’s purchasers are focusing on value-added properties and communities, given new market realities,” said Elton Ash, the executive vice president of RE/MAX Canada.
“Listings that offer a short or long-term benefit – be it a basement apartment that allows homeowners to offset their mortgage costs now or homes that hold long-term potential in a future renovation or sale to a builder—are most sought-after. Location, while still an important aspect, has been replaced by value and necessity. A growing number of buyers are willing to travel further afield to get the best bang for their buck.”
Considering how high rents have become in the last couple of years, even a modest discount on a basement apartment’s rent can support homeowners’ mortgage payments.
A Look at the Numbers
The latest shift in consumer demand helps explain why detached home sales climbed up to nearly 45 per cent in the first half of 2023 in the Greater Toronto Area (GTA) housing market and close to 30 per cent in the Greater Vancouver Area (GVA) real estate market, according to new data compiled by RE/MAX.
Whether they bought at the beginning of the coronavirus pandemic when the central bank slashed rates to nearly zero, or families who took advantage of the modest correction during the BoC’s tightening cycle at the start of spring 2022, homebuyers will enjoy the long-term benefit of higher home prices because of the additional value found inside these residential properties.
To further support this supposition, the York Region housing market enjoyed a significant boost in detached home sales in the second quarter, skyrocketing 104 per cent from the previous quarter. As demand continues to increase and supplies fail to keep up, home valuations will likely maintain their general upward trajectory.
But the state of communities is essential, too. Whether it is amenities or the neighbourhood’s fabric, everything outside of a residential property can support prices. For homebuyers, it is a balancing act: the arts and culture of a major urban centre or the large shopping malls and large chain restaurants in these smaller communities.
And then there is the issue of taxes, especially the municipal land transfer tax.
While detached homes situated in areas outside Toronto enjoy slightly lower prices, they are not subjected to the municipal land transfer tax, something that provides enormous savings for homebuyers.
Remember, a recent Leger survey found that more than one-quarter of Canadians (28 per cent) say that the land transfer tax has affected their decision to dip or not to dip their toes in the Canadian real estate market.
Meanwhile, shifting back to the major urban centre, a handful of neighbourhoods in Toronto that possess long-term potential are bucking the national trend of sliding detached home sales.
Bathurst Manor-Clanton Park is considered the most affordable and undervalued area of North America’s fourth-largest city. Detached housing values are a little more than $1.7 million, representing the lowest average price point in the downtown core, which explains the robust homebuying activity in the first six months of 2023 compared to the same time a year ago.
H2 Investors Versus First-Time Homebuyers
There is little doubt that value-added properties are exceptional investments. The challenge, however, is that there is fierce competition between investors and first-time homebuyers.
According to Statistics Canada, housing markets that possess the largest percentage of investor-owned housing are Toronto (22 per cent), Georgina (18 per cent), East Gwillimbury (15 per cent), Richmond Hill (15 per cent), and Mississauga (14 per cent).
So, this creates a barrier to entry for households acquiring a detached home in either Toronto Central or municipalities outside Canada’s largest city.
“In Ontario, businesses owned 74,485 condominium apartments for investment purposes,” Statistics Canada stated in its report. “Most condominium apartments used as an investment in both Ontario and Manitoba were owned by in-province investors.
Whatever the case may be, it is clear that shrinking inventories and robust demand will add to Canadian real estate market prices, be it in British Columbia or Ontario. Don’t believe it? Not even the Bank of Canada raising interest rates put a major dent into home prices this past year.
Source
New property listed in Zone 35, Edmonton
I have listed a new property at 54 14208 36 ST in Edmonton. See details here
Welcome to this over 1300 sq ft Half Duplex situated in Clareview Town Centre, close to all amenities including LRT station! Quiet complex. Open concept main floor. Spacious living room with laminate floors throughout. Great size kitchen with island and eating bar, and corner pantry. Two piece bath and convenient main floor laundry as well! Upstairs you will be impressed with a huge primary suite, with an ensuite with 5 ft shower and double sinks! A nice size walk in closet completes the space. Two more spacious bedrooms upstairs, as well as 4 pce main bath. Patio doors lead to a private, fenced yard. Close to all amenities!
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Are You Covered? Tenants Insurance Basics
If you are renting a property, taking out a tenant insurance policy is an important safety net protecting you and your belongings if certain traumatic events occur. Check out this information on the basics of what is covered, what is not and the average cost per year.
Re/Max Home Hibernation Contest
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Guide to Mortgage Renewal: How Do I Renew My Mortgage?
During the pandemic-era housing boom, many homebuyers purchased residential properties at rock-bottom mortgage rates. In response to the national economy’s pressures, the Bank of Canada (BoC) slashed interest rates to near zero, allowing prospective homeowners to obtain greater purchasing power and acquire a detached house, townhome, or condominium suite that might have exceeded their initial budgetary limits.
Now that rates are at their highest levels in 16 years and the average five-year fixed mortgage rate is close to six percent when these homeowners renew their mortgages, they will need to be prepared for higher monthly payments. It might be a couple of hundred dollars, or it might be a couple of thousand dollars. It all depends on the size of the mortgage and the rate.
Before diving into the steps of renewing the mortgage, it is essential to become acquainted with the basics of mortgage renewals.
Mortgage Renewal: A Primer
So, what do you need to know about a mortgage renewal?
The term of their mortgage expires between one and five years, and you need to renew your mortgage to continue borrowing from the lender. When a mortgage term ends, you can modify the terms of the original mortgage, including changing the length of the term, from a three-year term to a six-year term, for example. Or you may adjust the amortization period or payment frequency.
What You Need to Know About Requalifying
Now, what about requalifying for a mortgage?
Borrowers need to requalify if they switch mortgage lenders. At the same time, considering how high interest rates are today, this would be pretty challenging to requalify for some. The process can be a lot easier if borrowers renew with the current mortgage lender and refrain from negotiating better terms and conditions. However, once mortgage holders attempt to shop around for a different lender, they must requalify. This could leave them in a difficult situation: it would be tougher to renew, and subsequently, homeowners might be left without a lender, forcing them to sell their home. Of course, the other option is to meet with a private lender and pay significantly higher interest rates.
H2 Steps to Mortgage Renewal
Mortgage renewal is a crucial decision that should be carefully considered. You must view current market conditions, evaluate your financial goals, and consult with mortgage professionals to ensure the renewed mortgage aligns with your goals. In addition, the process will involve renegotiating the terms and conditions of an existing mortgage loan, which affirms that a decision must be well-planned.
Here are six steps to follow when renewing a mortgage:
#1 Start the Process Before the Current Mortgage Expires
Beginning the renewal process a few months before your current mortgage term expires is vital. This will give you time to study the market, compare offers from different lenders, and negotiate the best terms. The renewal process can be initiated through your lender or mortgage broker.
#2 Clearly Understand the Terms of Your Current Mortgage
Mortgage agreements can be complex, and you should read the fine print before you start the renewal process. Therefore, you must carefully assess the current mortgage agreement, including the interest rate, remaining balance, repayment terms, and, most importantly, any applicable fees or penalties you may have to pay if you terminate the mortgage early.
This step lets you identify the changes or improvements you want in the renewed mortgage.
#3 Check the Market and Get Competitive Rates
Renewing your mortgage allows you to explore other lending options. Your goal should be to secure the most favourable terms. For this, you will need a clear idea about current interest rates, different mortgage products, and terms offered by other lenders. Many borrowers are not well-versed in these things, so consulting with a mortgage broker can simplify this process.
#4 Always Negotiate the Terms
When you have collected sufficient information about competitive rates and the different types of mortgages, you should first negotiate with your existing lender unless your goal is to find a new one altogether.
If your existing lender is not offering you the best terms, you can turn to potential new lenders and consider two other components:
- Evaluate each offer according to the improvements you seek in the new mortgage agreement.
- Ensure you receive better terms in the renewed deal regarding the interest rate, repayment schedule, amortization period, and prepayment options.
#5 Ensure All Documentation is Complete
The process of getting a mortgage (or renewing one) is intricate. One area that requires a bit more due diligence is documentation, as lenders will request a lot of paperwork:
- Proof of income
- Employment verification
- Bank statements
- Other documents that can help lenders determine your financial stability.
Indeed, this is a critical step, so ensuring all documents are accurate and provided to the lenders without delay is imperative.
#6 Review the New Agreement Carefully
Lastly, the final step during your renewal process is to review the terms and conditions of the new mortgage agreement. As a result, be sure to check the interest rate and payment schedule and ensure they align with your goals. If you need help understanding something, seek clarification from an industry professional. Ultimately, you should only sign the mortgage renewal agreement if you are delighted with the terms or have no better option.
Source
CMHC
October 2023 | Edmonton Real Estate Housing Market Update
Total residential unit sales in the Greater Edmonton Area (GEA) real estate market for October 2023 came to 1,812, decreasing from September 2023 by 12.0%, but showing an increase of 21.0% over October 2022.
New residential listings amounted to 2,753, which is 8.8% lower than September 2023, and 5.8% higher than October 2022. Overall inventory in the GEA showed decreases of 12.7% from October of last year and 4.9% from September 2023.
Detached unit sales totalled 1,055, a decrease of 12.7% from September 2023, but up 12.6% from the previous year. Semi-detached unit sales were down 9.2% month-over-month but showed an increase of 20.7% from October 2022. Row/Townhouse unit sales were down 2.2% from September 2023 and up 26.4% year-over-year. Apartment Condominium unit sales saw numbers increase 57.3% from last year and dip 19.2% lower than September 2023.
Total residential average prices came in at $396,550, a 0.6% increase from September 2023, and a 0.7% decrease from October 2022. Detached homes averaged $486,751, amounting to a 1.8% year-over-year increase, but a 1.4% decrease from September 2023. Semi-detached sold for an average of $385,895, resulting in a 4.2% increase year-over-year, and a 9.0% increase from the previous month. Row/townhouse prices were down 3.1% from September 2023 and down 0.6% when compared to October 2022, selling at an average of $258,779. Apartment Condominium average prices hit $203,663 showing increases of 11.8% from last month and 8.9% from last year.
The MLS® Home Price Index (HPI) composite benchmark price* in the GEA came in at $377,000, resulting in a decrease of 0.8% from September 2023, and a year-over-year increase of 0.6% from October 2022.
Detached homes averaged 43 days on the market, increasing one day from September 2023. Semidetached homes averaged 47 days on the market, an increase of 10 days from the previous month, and row/townhouses showed now change, averaging 42 days on the market. Apartment condominiums averaged 61 days on the market, showing a seven-day decrease from September 2023.
Overall, all residential listings averaged 46 days on the market, increasing by two days monthover-month and dropping by four days in comparison to October 2022.
Craig Finnman
Re/Max Elite
craig@craigfinnman.ca
780-982-1589
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New property listed in Sherwood Park, Sherwood Park
I have listed a new property at 41 219 CHARLOTTE WAY in Sherwood Park. See details here
LOW CONDO FEES in Lakeland Ridge Condominiums, central location to all Sherwood Park amenities! Welcome home to this LIKE NEW Half Duplex with FULLY FINISHED BASEMENT, 3.5 baths, & private, fenced, south facing backyard! Modern finishes throughout, including hardwood floors throughout main floor. Bright & spacious living room opens to kitchen w/upgraded SS appliances & large corner pantry. Large master bedroom, with walk in closet & ensuite with 5 ft shower. Two more spacious bedrooms with 4 pce bath, as well as CONVENIENT UPSTAIRS WALK IN LAUNDRY. The basement features a great size recreation/family room, and another 4 pce bath! Also be impressed with these other features: NEW TANKLESS HOT WATER ON DEMAND (1 yr old), NEW CARPET (3 yrs old), Hardie Board exterior siding/stonework, insulated garage, BBQ gasoline on deck, TRIPLE PANE WINDOWS, & spray foam insulation. There are six convenient visitor stalls conveniently close by to this unit. This well built home is waiting for you to just move in and enjoy!
Offering a Helping Hand on Your Homeownership Journey
As your Edmonton Re/Max Elite Realtor, I'm thrilled to offer a helping hand on your homeownership journey. If you're exploring mortgage options, I've got fantastic news – I can connect you with a like-minded professional who specializes in seamless pre-approvals!
Let's turn your dream home into a reality. Ready to take the next step? Message me today!
(780) 982-1589
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What is the Difference Between a Home Appraisal and a Current Market Assessment?
Living in an “information age,” the answers to nearly every question are just a click away. Problems find solutions, mysteries are solved, and the world seems to spin faster, but how do we verify that the information is correct?
With 90% of consumers beginning their home search online, virtually anyone can make a reasonably educated guess on what the value of their home is. Sellers can explore similar houses with similar features and cross-reference those with listings in their neighbourhood to see what buyers are looking for and how much they are willing to pay. As a buyer, this leaves you wondering whether you are paying a fair price for your dream home. Fortunately, some professionals conduct Home Appraisals, giving everyone involved in the transaction peace of mind.
Home Appraisal
A home appraisal is an objective assessment of a property’s value conducted by a licensed or certified appraiser. The home appraisal provides buyers with a market value of the home based on several factors, including the property’s location, age, and current condition. A home appraisal generally costs between $300-$400, and along with providing security to all parties involved, it is also used to satisfy mortgage requirements.
During the appraisal process, the appraiser visits the property and conducts a thorough inspection, taking note of its physical characteristics, features, and any improvements or renovations. The appraiser also considers factors such as the neighbourhood, proximity to amenities, and recent sales of comparable properties in the area.
After gathering all the necessary information, the appraiser uses a combination of valuation methods, including the sales comparison approach, income approach (for rental properties), and cost approach, to arrive at an estimated value for the property. The final appraisal report provides a detailed analysis and justification for the determined value.
Mortgage financing companies want to know the value of the property they are providing a loan for, should the buyer not be able to pay their mortgage. By getting a home appraisal, all parties can feel secure in the sale, knowing they are making a good investment and receiving a fair arrangement.
Current Market Assessment
A current market assessment (CMA), also known as a market analysis or market evaluation, is an evaluation of a specific market’s current state and conditions. It involves gathering and analyzing data to understand the dynamics, trends, and factors influencing supply, demand, and pricing within a particular market segment or industry. There are several elements considered:
Market Size and Growth – The market is assessed regarding sales volume, revenue, or other relevant metrics. Additionally, historical data and trends are analyzed to determine the market’s growth rate over a specific period.
Market Segmentation – A CMA identifies and categorizes the market into segments based on various factors such as demographics, customer preferences, product types, or geographic locations.
Competitive Landscape – A CMA evaluates the competitive environment within the market, including the number and strength of competitors, their market share, key players, and their strategies.
Supply and Demand Analysis – The market’s balance between supply and demand is examined. This includes analyzing inventory levels, production capacity, consumer preferences, and pricing dynamics.
Market Trends and Influencing Factors – Key trends, drivers, and external factors that impact the market are identified and analyzed. This includes technological advancements, regulatory changes, economic conditions, consumer behaviour, and social trends.
A home appraisal is not to be confused with a current market assessment. Typically, a CMA is provided by your local real estate agent during the listing process and is complimentary. This report assists with determining the home’s asking price, using current housing market information such as supply and demand, seasonality and home information like location, age, square footage and more.
Although both reports are similar and use relatively the same set of criteria, a CMA is ultimately determined by what current buyers are willing to pay for the home in a range acceptable to the seller. A Home Appraisal is based strictly on the physical attributes of the house.
Ensure you are prepared and ready for anything in your home-buying journey. Are you interested in getting a Current Market Assessment on your home? Connect with me today!
Craig Finnman
Re/Max Elite
craig@craigfinnman.ca
780-982-1589
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New property listed in Rural Thorhild County, Rural Thorhild County
I have listed a new property at - - in Rural Thorhild County. See details here
Half Section (320 Acres) of Land 5.5 miles north east of Newbrook, Thorhild County. Good Access and only 3 1/2 miles off highway 63. Some open meadows and lots of bush for Hunting.
New property listed in Zone 35, Edmonton
I have listed a new property at 1 4707 126 AVE in Edmonton. See details here
Welcome to this great END UNIT Townhouse in Homesteader! Main floor has great size living room with laminate floors and wood burning stone fireplace and patio doors to fenced yard. Kitchen has white cabinets with dining room adjacent. Main floor also has convenient 2 pce bath. Upstairs offers 3 bedrooms & 4 pce bath. FULLY FINISHED BASEMENT has a wet bar along and great size recreation area. NEWER CARPET and PAINTED THROUGHOUT. This unit has 2 assigned parking stalls and street parking too. Close to Yellowhead trail & the Anthony Henday for easy access. Close to all amenities, including This property is just minutes away from hiking/walking trails, shopping, transportation.
How Do You Win A Bidding War?
The Canadian housing market has seen record prices over the last two years. With record-low inventories and increasing demand, prices soared from coast-to-coast. It is the perfect recipe to create a seller’s market, meaning that competition for homes is fierce. RE/MAX brokers reported multiple-offer scenarios in key Canadian housing markets such as Toronto, Ottawa, and Vancouver. This leads many to question what prompts multiple offers and how to win a bidding war.
How a Bidding War Works
In a seller’s market, there are more buyers than homes available for sale. The combination of limited inventory and high demand often puts upward pressure on prices, creating the ideal conditions for a bidding war. Homes typically sell quickly in a seller’s market, and multiple offers on a listing are more likely, giving the seller the upper hand.
When market conditions favour sellers, demand is usually up, and inventory is down, which has been the case throughout the pandemic. With few listings on the market, the seller and listing agent may choose to set an offer deadline by which interested buyers must submit their offers. In a bidding war, there are multiple offers and pressure for potential buyers to compete to raise their bids, pushing the sale price well above asking.
A bidding war typically follows these steps:
- Buyers interested in the property submit their offers to the seller or real estate agent. The offer typically includes the proposed purchase price, conditions or contingencies, and the desired closing timeline.
- The seller reviews all received offers and assesses their attractiveness based on the purchase price, closing timeline, contingencies, financing details, and buyer qualifications.
- The seller may negotiate and respond to one or more buyers by issuing counteroffers. Counteroffers typically involve adjustments to the original offer’s purchase price, terms, or conditions.
- A bidding war can emerge if multiple buyers are still interested and engaged. Buyers may be notified that they are in a competitive situation and can revise and improve their offers.
- Buyers raise their initial offers, often exceeding the original asking price, to outbid other potential buyers and demonstrate their commitment to securing the property.
- The seller evaluates the revised offers and determines which is most favourable based on the purchase price, conditions, financing, and the buyer’s ability to close the deal.
- The seller accepts the winning offer, and the buyer proceeds to fulfill any remaining conditions or contingencies specified in the offer. Once all requirements are met, the sale is finalized, and the closing process begins.
In Canada, policymakers have introduced various measures to address these issues. For instance, cooling measures have been implemented to curb excessive speculation and prevent housing bubbles. These measures include foreign buyer taxes, restrictions on foreign investments, and stricter mortgage qualification rules. The objective is to ensure that the housing market remains accessible to Canadian residents and that affordability is not compromised.
The Importance of a Real Estate Agent in a Seller’s Market
Sellers can only hope to receive multiple offers on their listings. However, from the buyer’s perspective, it can be a frustrating and emotional experience. When you look at the bigger picture of a home purchase, “winning” is relative to the buyer’s goals. If the only objective is to buy a specific home, then offering the highest possible purchase price with no offer conditions is the way to go. It is the way to get the house you want.
However, most homebuyers have other goals, such as buying within a specific price point and a defined timeline for closing the deal and moving in. Then there’s the home itself. Does the buyer intend to fix and flip it? Demolish and build? Or are they seeking a move-in-ready home? Whatever that goal is, buyers should communicate it to their realtor, who can help strategize how to reach it. While you might need to make some concessions, your realtor will do what is necessary to realize as many of your goals as possible.
The real estate agent’s job is to approach the transaction objectively. This includes the process of real estate bidding and negotiating. They can bring logic to this emotional process and potentially help you avoid a massive financial risk. A professional, experienced real estate agent who knows the local market can help you keep your eyes on the prize – a home that suits you, your budget, and your long-term goals.
How to Win a Bidding War
Here are some strategies to help you make an intelligent bid and a wise purchase if all goes in your favour:
Know Your Budget – Knowing how much you can spend on a home is critical for a homebuyer. Getting a mortgage pre-approval can provide valuable insight and guarantees your mortgage interest rate for up to 120 days, which is essential as rates climb upward. When you’re ready to make an offer, despite your eagerness to win the war, so to speak, do your due diligence and consult with your lender before making a firm offer.
Consider the Worth of the House – This is especially important as housing prices soar, even in smaller communities. Your real estate agent will pull recent sales stats, giving you valuable insight into the selling price of comparable homes in the same neighbourhood and under the same market conditions. This can help you determine an offer you’re comfortable with and whether competing against other bids makes sense.
Reduce Your Offer Conditions – In a seller’s market, having fewer conditions on your offer can work in your favour. Flexibility on your desired closing date or inclusions could tip the scales in your favour. A clean offer is more likely to win in a seller’s market, especially in a bidding war. With that said, we highly recommend making the offer conditional on a satisfactory home inspection. Remember that even if you discover issues with the home in a seller’s market, you may still not have much negotiating power. However, having this information will help you decide if the house is worth what you’re expected to pay.
Consider the Location – Beyond the home itself, remember that location is a huge factor in determining a home’s value. Premium neighbourhoods come at higher prices, thanks to proximity to amenities, green space, transit routes, shopping, services, and other factors. Whatever draws people into the area is likely a factor driving up the selling price.
How to Avoid a Bidding War
Short-Term Strategy – One trick to winning a bidding war is to avoid it altogether. Make an offer before the home hits the MLS system or gains buyer attention through an open house. Your agent will best advise you on how to proceed, so prepare to drop everything to tour a new listing and make your offer before someone else does! (Note: Mortgage pre-approval in this scenario is critical.)
Long-Term Planning – The spring and summer real estate markets see the most activity under normal conditions, with buyers out in droves and bidding wars bubbling at the surface. If you’re not in a hurry to buy, minimize your competition and possibly even price by shopping in the “off” season. Winter sees a drop in inventory and demand, reducing your chance of being outbid.
Do Your Homework – You’ve determined how much you can afford, right? And you know what the home is worth based on the comparables your real estate agent pulled for you. You also know what the home is worth based on your lifestyle, budget, and future employment prospects. Make a bid that’s reflective of all these considerations. Before jumping on the bidding bandwagon, be confident you’re getting a good deal.
When asking how you win a bidding war, remember that the spoils don’t always go to the highest bidder. Know when to walk away. Even in a seller’s market, the perfect home is out there, waiting for you to find it.
Source
Ways to Support Local Businesses
This year, Small Business Saturday is on Nov. 25. A strong small business community helps to create a dynamic and thriving healthy overall community. I am sharing some creative and fun ways on how you can support your local small businesses this holiday season.
New property listed in Zone 03, Edmonton
I have listed a new property at 378 HOLLICK-KENYON RD in Edmonton. See details here
Welcome to this over 1600sqft IMMACULATE BUNGALOW located in Hollick-Kenyon, with so much to offer! Walk into a spacious foyer, with great size den adjacent. Huge kitchen, with lots of cabinetry, corner pantry, large island/eating bar, and OPEN CONCEPT to living and dining. Great size living room w/gas fireplace, with large windows overlooking backyard. Convenient MAIN FLOOR LAUNDRY ROOM. Spacious primary bedroom has large walk in closet and 4 pce bath, with separate shower and soaker tub. Second bedroom and 4 pce bath on main floor as well. FULLY FINISHED BASEMENT boasts a huge recreation room, useful as games area, family room area, exercise, and also has a wet bar/kitchenette, which could be extended into a second kitchen. Lots of storage options as well. This home also has NEWER HWT (3 yrs old), NEW SHINGLES (2 yrs ago), CENTRAL AC and AIR PURIFIER, and INSULATED/HEATED GARAGE. Backyard has gorgeous landscaping and large deck. Perfect entertaining home! Pride of ownership! Don't miss out on this one!
New property listed in Zone 35, Edmonton
I have listed a new property at 14848 35 ST in Edmonton. See details here
Welcome to this 4 level split gem in Kirkness! Walk into spacious front entry, with large living space and bay window. Laminate throughout home, and newer vinyl plank tile in kitchen. Kitchen has lots of cabinetry, with dining space. Walk up to two spacious bedrooms with 4 pce bath. Lower level boasts a large rec room/family room with 3 pce bath with shower. Basement is partly finished with framing already done, and some flooring. Great size laundry area, and good potential for future bedrooms, or other living space as well! This home also has a huge deck off side entrance that also faces very private backyard with no neighbours behind! This backyard also has a fire pit area as well as an oversized newer shed. Other upgrades to this home include: newer vinyl plank floors in kitchen, BBQ gas line on deck, upgraded to tankless hot water heater and water softener 2016, new Lennox furnace 2016, new siding and windows 2014. Scheduled to have shingles replace October (weather pending). Just move in and enjoy!
September 2023 | Edmonton Real Estate Housing Market Update
Total residential unit sales in the Greater Edmonton Area (GEA) real estate market for September 2023 hit 2,058, dropping from August 2023 by 8.4% and increasing 25.8% compared to September 2022. New residential listings decreased slightly, at 0.1% year-over- year from September 2022, and decreasing 3.3% from August 2023. Overall inventory in the GEA was down 15.7% from September of last year, and down 2.8% from the previous month.
Detached unit sales totalled 1,311, a decrease of 8.0% from August 2023, but up 26% from the previous year. Semi-detached unit sales were down 11.0% month-over-month but increased by 6.9% from September 2022. Row/Townhouse unit sales were down 20.6% from August 2023 and up 28.0% year-over-year. Apartment Condominium unit sales had an increase of 59.3% from September 2022, and are the only property type to see an increase from the previous month, sitting at 3.2% higher than August 2023.
Total residential average prices came in at $394,000, a 0.1% decrease from September 2022, and a 1.0% decrease from August 2023.
Detached homes averaged $493,0328, noting a 2.4% year-over- year increase, but a 0.4% decrease from August 2023. Semi-detached sold for an average of $353,929, resulting in a 4.2% decrease year-over-year, and a 5.2% decrease from the previous month. Row/townhouse prices were up 8.0% from September 2022 and up 5.4% month-over-month, selling at $267,100. Apartment Condominium average prices hit $182,103 showing a decrease of 5.7% from last month and a decrease of 1.6% from September 2022.
The MLS® Home Price Index (HPI) composite benchmark price* in the GEA came in at $380,280, resulting in a decrease of 0.1% from August 2023, and a drop of 1.2% from September 2022.
Detached homes averaged 42 days on the market, increasing three days from August 2023. Semi- detached homes averaged 37 days on the market, decreasing 5 days from the previous month, with row/townhouses averaging 42 days on the market, a decrease of two days month-over-month. Apartment condominiums averaged 54 days on the market, showing a two-day decrease from August 2023. Overall, all residential listings averaged 44 days on the market, decreasing by four days year-over-year and two days from August 2023.
Craig Finnman
Re/Max Elite
craig@craigfinnman.ca
780-982-1589
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Your Chance to Win 2 Years of Netflix Premium with RE/MAX!
We're thrilled to share some exciting news with you – RE/MAX is giving you a chance to win 2 years of Netflix Premium with our 'This One's On Us' contest! Imagine yourself at home, kicking back and enjoying your favorite movies and series stress-free.
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Contest Link: https://blog.remax.ca/bingewatchmore/
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Home Ownership Rates in the Canadian Real Estate Market
If you are interested in purchasing a residential property in 2023, the competition will be fierce as housing supply remains tight and demand begins to be renewed. Mortgage rates have likely peaked, the consumer remains in decent shape, the Canadian government’s immigration program anticipates seeing hundreds of thousands of newcomers in the next couple of years, and the national economy is holding steady.
While housing affordability is not at the forefront of the federal government as it was in the last election campaign, many local governments are taking action to ensure that more Canadians can achieve the dream of homeownership. But will this be enough to increase housing opportunities and ownership rates? Many industry observers argue that federal policy proposals, such as home renovation tax credits and co-housing CMHC-backed mortgages, might not be enough to curb sky-high prices. Instead, policymakers need to facilitate more supply initiatives, like streamlining new developments and speeding up the application process.
Indeed, despite the housing correction over the last 18 months, prices are still above their pre-pandemic levels, be it a detached residential property in Atlantic Canada or a condominium in downtown Toronto. This has left many Canadian households to continue renting, which has also become an exorbitant expense in plenty of markets.
So, are these trends weighing on homeownership rates across the country?
Home Ownership Rates Drop Across Canadian Real Estate Market
Since the beginning of the century, the homeownership rate in the Canadian real estate market has steadily risen, climbing from 63.9 per cent in 2000 to an all-time high of 68.55 per cent in 2019. However, according to Statistics Canada, the national homeownership rate slipped to a four-year low of 66.5 per cent in 2022. In all provinces, homeownership rates have been on the decline.
Here is a breakdown of provincial homeownership levels:
- British Columbia: -3.2 per cent to 66.8 per cent
- Alberta: -2.7 per cent to 70.9 per cent
- Saskatchewan: -1.9 per cent to 70.7 per cent
- Manitoba: -2.6 per cent to 67.4 per cent
- Ontario: -3.1 per cent to 68.4 per cent
- New Brunswick: -2.7 per cent to 73 per cent
- Nova Scotia: -4 per cent to 66.8 per cent
- Prince Edward Island: -4.6 per cent to 68.8 per cent
- Newfoundland and Labrador: -1.8 per cent to 75.7 per cent
Put simply, the homeownership rate is higher at the provincial level than nationally. However, the two most populous and expensive Canadian real estate markets – Ontario and British Columbia – are closer to what it is nationwide.
In addition, Canada ranked 23rd among Organisation for Economic Co-operation and Development (OECD) countries. This was also below the OECD’s average of 71.5 per cent.
Overall, everything that has transpired over the past year, from higher interest rates to slowing economic conditions, has discouraged young Canadians about owning a residential property.
Survey: Young Canadians Discouraged About Homeownership
According to the Bank of Montreal’s recent Real Financial Progress Index, 68 per cent of Canadians feel purchasing a home is out of reach. Seventy-one per cent of Generation Z Canadians (18 to 24) are most likely to share this view. This is followed by 69 per cent of younger millennials (25 to 34) and 65 per cent of older millennials (35 to 44).
The June 2023 survey from the financial institution revealed that 67 per cent of Generation Z Canadians plan to defer their home-buying efforts, while 73 per cent of younger millennials postpone their home-buying plans.
“While the challenging market and economic conditions may pose hurdles and uncertainty, we encourage Canadians to work with a professional advisor or planner to explore the many paths to homeownership,” said Gayle Ramsay, the head of everyday Banking, segment and Customer Growth at BMO, in a statement.
Finally, 71 per cent of Canadians consider housing costs the third largest source of financial anxiety, following unknown expenses and concerns about their personal finances.
Another Stark Revelation: Falling Housing Investment
Housing investment is falling across the country.
Statistics Canada recently reported that investment in building construction slumped 1.3 per cent in March to $20.3 billion. Within this category, residential sector investment construction tumbled 2.1 per cent to $14.6 billion, while non-residential sector spending rose 0.9 per cent to $5.7 billion.
The statistics agency discovered that investment in single-family homes dropped 1.8 per cent to $7.9 billion, with seven provinces recording declines. Moreover, multi-unit construction slipped 2.4 per cent to $6.7 billion, led by Ontario (-4.7 per cent).
This trend is seen in new housing construction activity data Canada Mortgage and Housing Corporation (CMHC) data show that housing starts declined 23 per cent month-over-month in May, totalling 202,494 units. Despite an immense jump in April, it was down considerably in March at 213,800 units.
Rishi Sondhi, an economist at TD Bank, says this has been expected due to declines in home sales feeding “into falling construction activity.”
“This is also consistent with permit issuance, which has dropped to 2019 levels, before the pandemic-induced runup in demand and construction,” Sondhi wrote in a research note.
“That said, starts are volatile and not every data point will move in a straight line downwards. Even with today’s decline, starts are tracking 4% higher than their first-quarter average, thanks to an April pop. This, alongside what will likely be a super-sized gain in home sales should generate a positive second-quarter growth print for residential investment, supporting the overall economy.”
Heading Into 2024 – and Beyond!
The Canadian real estate market has many storylines to follow, from high borrowing costs to tight inventories. The coming year should be an exciting time in Canada, with many components that could weigh on or support the direction of the overall housing activity, be it interest rates or local reforms. Whether prices will rebound in the second half of 2023 and heading into 2024 remains to be seen.
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