Big city show down: How Edmonton stacks up with Calgary

Two cities of over a million people and both are impacted by the oil bust in Alberta.  As much as Edmonton and Calgary are alike, they are different.  In checking the stats on the first half of 2016, a glance at new housing and resale homes activity in both markets draws similarities between the two major centres.

Construction starts

Edmonton and Calgary saw fewer shovels in the ground in the first six months of the year.  Numbers from Canada Mortgage and Housing Corp put housing starts in Edmonton at 1,378 compared with 2,140 in the first six months of 2015.  Calgary fared a little better with 1,068 homes so far this year, down from just 1,426 this time frame last year.   In looking at the numbers just for June 2016, Edmonton saw 1,673 detached homes still under construction.  There were fewer in Calgary with 1,419 homes in mid-build.

Residential resale

Analysis of the single-family home sector which is that portion of the market in which the majority of resale residential sales take place, shows that 5,189 units changed hands the first half of this year in Edmonton.  The REALTORS® Association of Edmonton says that in the same time period last year, 5,569 homes turned over, a difference of just 380 homes.  A small drop, all things considered.  In Calgary this year’s number is 5,799 compared with last year’s figure of 6,196 according to the Calgary Real Estate Board.  The difference is 397 so it would appear that the resale figures within the two cities are very similar.

Lots of choice

In looking at figures between the two cities, there were fewer listings that entered the marketplace. Fewer people are putting their homes up for sale in both cities, yet with fewer sales there was ultimately more choice for buyers in Edmonton and Calgary. In the first six months of this year there were 9,988 new listings in Edmonton, down from 10,444 last year. In Calgary, there were 10,326 single-family homes put up for sale in the resale sector, a drop of 4% from the 10,756 added in 2015.  It would appear both cities are following similar trends.

Resale home prices

Average sale prices in the single-family resale home market dropped in both cities but not by as much as one might think.  Oil patch workers and those in related industries such as construction have left the province but have vacated mostly rental accommodations. Therefore there has not been heavy downward pressure on prices in Edmonton or Calgary, yet.

Examination of median prices for detached homes in Edmonton for the first half of each year show prices fell from $415,000 to $404,000. In Calgary, the median single-family home price was higher at $489,250 and fell as well from last year’s six-month median price of $493,400.

Prices and variety in new homes

In June 2016 there were 490 new single-family homes that were finished and ready for occupancy in Edmonton as opposed to 306 in June of 2015 – a dramatic difference in the number of quick possession homes typically constructed by new homes builders.   Things were more scaled back in Calgary, with 254 single-family quick possession homes that were move-in ready opposed to 267 which were available in June 2015.  Whether Calgary builders were more prepared is worthy of another article.

There is an appreciation difference and when comparing Edmonton with Calgary in terms of pricing in new construction. Edmonton bucked the all-over trend, with spec homes priced on average last month at $606,103 compared with last year when the average was $536,713.  Unabsorbed new construction in the single-family sector in Calgary was on trend, valued last month at $776,816 and a year ago it was less at $738,503.