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Edmonton’s real estate market led by strong demand for bigger homes in south

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Edmonton’s resale real estate market had the highest sales figures by a large margin for February over the last four years with neighbourhoods in the south leading the charge, the most recent monthly data shows.

In particular, buyers are seeking more size offered by relatively newer homes in the city’s southeast and Anthony Henday areas, says Tom Shearer, chair of the Realtors Association of Edmonton. The Anthony Henday area includes communities largely south of the ring road as well as some to the west, encompassing communities including Blackmud Creek, Windermere, Callaghan and Summerside.

“To me, it’s just simple math: the lower interest rates, higher buying power and less concern about the commute,” he says. “There is a flight to value, and this is what is showing in those newer areas.”

Edmonton’s resale market saw 1,091 transactions (excluding outlying municipalities) last month, up more than 44 per cent over the same period in 2020, led by demand for single-family homes, RAE figures for February reveal. This housing type accounted for more than 65 per cent of sales overall, growing by more than 50 per cent last month, year over year.

Yet the Anthony Henday and the southeast were among the most activity for single-family detached homes sales, with 156 and 117 sales respectively last month.

The north central area also saw strong sales with 143 sales in February. Those three areas out of the eight in the city made up more than 63 per cent of all single-family home sales.

“Just like you saw a whole bunch of new development in the southeast part of the city, it’s the same there (north central),” Shearer says, adding the area also features newer housing stock along with affordable, older single-family homes.

Edmonton realtor Azra Bagga with Royal LePage Noralta, who specializes in the Anthony Henday and southeast areas, says newer homes are seeing the greatest demand.

“We did a property on Friday in the southeast in the Silver Berry area, and it had six offers within two days, and sold for over list price,” she says, about the home in the community completed in 2011.

“Every property we’re showing is pending” with offers accepted by the seller.

Shearer says newer neighbourhoods — which typically have homes with larger floor plans — are increasingly in favour as a result of the pandemic. As a result, buyers are moving from apartment condominiums in central areas that typically do not have the new features buyers are demanding, such as a designated office.

“When we talk about the flight to value, you’re not getting that in areas that are centrally located, and often more mature neighbourhoods.” That even includes southeast communities like Bonnie Doon and Idylwylde. Homes there are often several decades old and may require significant renovations to update floor plans, which can add extra cost for buyers, who typically are budget-conscious, Shearer says.

In the past, however, these areas saw higher demand because of their location. Now the commute is a less of a concern so buyers are moving outward to get more for their dollar, he says.

It’s not just newer communities. Among the hottest spots in the city is Mill Woods.

“You have that perfect combination of entry-level pricing, square footage and lack of supply,” Shearer says. “A house goes up, and it sells right away.”

Yet demand for new or single-family homes built in the last few years is the dominant sales theme, brought on by the pandemic while, on the whole, more established communities are seeing lower demand, Shearer says.

“The more mature neighbourhoods offer convenience and, right now, convenience isn’t a high priority because people don’t need to be close to the office.”

Source: – Edmonton Journal

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Real eState

What Is the Canada Mortgage and Housing Corporation (CMHC)

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The Canada Mortgage and Housing Corporation (CMHC) is a Canadian Crown Corporation that serves as the national housing agency of Canada and provides mortgage loans to prospective buyers, particularly those in need.

Understanding the Canada Mortgage and Housing Corporation (CMHC)

The Canada Mortgage and Housing Corporation (CMHC) serves as the national housing agency of Canada. CMHC is a state-owned enterprise, or a Crown corporation, that provides a range of services for home buyers, the government, and the housing industry.

CMHC’s stated mission is to “promote housing affordability and choice; to facilitate access to, and competition and efficiency in the provision of, housing finance; to protect the availability of adequate funding for housing, and generally to contribute to the well-being of the housing sector.”1

A primary focus of CMHC is to provide federal funding for Canadian housing programs, particularly to buyers with demonstrated needs. CMHC, headquartered in Ottawa, provides many additional services to renters and home buyers, including mortgage insurance and financial assistance programs. CMHC acts as an information hub for consumers, providing information on renting, financial planning, home buying, and mortgage management.

CMHC also provides mortgage loan insurance for public and private housing organizations and facilitates affordable, accessible, and adaptable housing in Canada.2 Additionally, CMHC provides financial assistance and housing programs to First Nations and Indigenous communities in Canada.3

Professionals and Consumers

CMHC provides services to both professionals and consumers. For professionals, CMHC aims to work in collaboration with different groups to provide affordable housing. Services include project funding and mortgage financing, providing information to understand Canada’s housing market, innovation and leadership networks to access funding and talent to spur housing innovation and increase supply, and providing speakers and hosting events for the industry.4

For consumers, CMHC seeks to provide all the tools an individual would need to either buy a home or rent a home and a variety of information and assistance for current homeowners, such as managing a mortgage, services for seniors to age in place, and financial hardship assistance.56

For financial hardship and mortgage assistance, CMHC provides tools that include payment deferrals, extending the repayment period, adding missed payments to the mortgage balance, moving from a variable-rate to a fixed-rate mortgage, and other special payment arrangements.7

Canada Mortgage and Housing Corporation (CMHC) and the National Housing Strategy

In November 2017, the Canadian government announced the National Housing Strategy.8 Rooted in the idea that housing is a human right, this 10-year, $70 billion project will largely be administered by CMHC, although some services and deliverables will be provided by third-party contractors and other Canadian federal agencies.9

Strategic initiatives of the National Housing Strategy include:

  • Building new affordable housing and renewing existing affordable housing stock
  • Providing technical assistance, tools, and resources to build capacity in the community housing sector and funds to support local organizations
  • Supporting research, capacity-building, excellence, and innovation in housing research10

History of the Canada Mortgage and Housing Corporation (CMHC)

CMHC was established in 1946 as the Central Mortgage and Housing Corporation by the federal government in Canada with the primary mission of administering the National Housing Act and the Home Improvement Loans Guarantee Act and facilitating discounts to mortgage companies. Initially, CMHC began by providing housing to returning Canadian war veterans, and toward the end of the 1940s, CMHC began to administer a program providing low-income housing across Canada.11

In 1947, CMHC was responsible for opening Regent Park, a large low-income housing project, and Toronto’s first urban renewal project. By the 1960s, CMHC introduced co-op housing and multi-unit apartment buildings throughout Canada.11

In 1979, the Central Mortgage and Housing Corporation changed its name to the Canada Mortgage and Housing Corporation

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Real eState

Canadian home price gains accelerate again in May

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Canadian home prices accelerated again in May from the previous month, posting the largest monthly rise in the history of the Teranet-National Bank Composite House Price Index, data showed on Thursday.

The index, which tracks repeat sales of single-family homes in 11 major Canadian markets, rose 2.8% on the month in May, led by strong month-over-month gains in the Ottawa-Gatineau capital region, in Halifax, Nova Scotia, and in Hamilton, Ontario.

“It was a third consecutive month in which all 11 markets of the composite index were up from the month before,” said Daren King, an economist at National Bank of Canada, in a note.

On an annual basis, the Teranet index was up 13.7% from a year earlier, the 10th consecutive acceleration and the strongest 12-month gain since July 2017.

Halifax led the year-over-year gains, up 29.9%, followed by Hamilton at 25.5% and Ottawa-Gatineau at 22.8%.

Housing price gains in smaller cities outside Toronto and its immediate suburbs again outpaced the major urban centers, with Barrie, Ontario leading the pack, up 31.4%.

On a month-over-month basis, prices rose 4.9% in Ottawa-Gatineau, 4.3% in Halifax and 3.7% in Hamilton.

The Teranet index measures price gains based on the change between the two most recent sales of properties that have been sold at least twice.

Canada‘s average home selling price, meanwhile, fell 1.1% in May from April, Canadian Real Estate Association data showed on Tuesday, but jumped 38.4% from May 2020.

 

(Reporting by Julie Gordon in Ottawa; Editing by Christopher Cushing)

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Economy

Bank of Canada seeing signs of cooling in hot housing market

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The Bank of Canada is starting to see signs that the country’s red hot housing market is cooling down, although a return to a normality will take time, Governor Tiff Macklem said on Wednesday.

The sector surged in late 2020 and early 2021, with home prices escalating sharply amid investor activity and fear of missing out. The national average selling price fell 1.1% in May from April but was still up 38.4% from May 2020.

“You are starting to see some early signs of some slowing in the housing market. We are expecting supply to improve and demand to slow down, so we are expecting the housing market to come into better balance,” Macklem said.

“But we do think it is going to take some time and it is something that we are watching closely,” he told the Canadian Senate’s banking committee.

Macklem reiterated that the central bank saw evidence people were buying houses with a view to selling them for a profit and said recent price jumps were not sustainable.

“Interest rates are unusually low, which means eventually there’s more scope for them to go up,” he said.

Last year, the central bank slashed its key interest rate to a record-low 0.25% and Macklem reiterated it would stay there at least until economic slack had been fully absorbed, which should be some time in the second half of 2022.

“The economic recovery is making good progress … (but) a complete recovery will still take some time. The third wave of the virus has been a setback,” he said.

The bank has seen some choppiness in growth in the second quarter of 2021 following a sharp economic recovery from the COVID-19 pandemic at the start of the year, he added.

(Reporting by David Ljunggren and Julie Gordon; Editing by Peter Cooney and Richard Pullin)

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