Tuesday, September 02, 2008

Where Does Edmonton Go From Here

If you're in the Edmonton market and feel that it's going to bottom out, the prices will be halved and we've seen it all before then you are not looking at the big picture and you need to stop reading the newspapers.

I've seen so many articles talking about the incredible amount of listings on the mls.ca and private listing services but when you really think about prices didn't plummet as every pundit forecasted. In fact they leveled out a bit and now are holding steady at about 10.98% lower than last year. The prices rose 40% for single family residential homes from 2006 so we are still holding a 25%++ increase in values since 2007.

Take a look at this chart from EREB

Single Family Condo All Residential
July 2006 Average Price $303,304 $188,831 $256,489
Peak 2007 Average Price $426,028 $271,908 $354,718
Price Increase 40.50% 43.99% 38.30%
July 2008 Average Price $379,224 $253,850 $335,100
Decrease from peak -10.98% -6.64% -5.53%
Increase over 2006 25.03% 34.43% 30.65%

Looks like a healthy market that is just adjusting to keep affordability in line - we used to be the 10th highest priced city in Canada now we are around 5th. Not overpriced and not undervalued as in 2006.

EREB predicts that the market will pick up over autumn and we will see an increase in sales which will cause the inventory to decrease and over time values to increase.

So basically this sale won't last for long! If you think you'll wait until prices "bottom out" to invest then don't hold your breath - who could predict that anyway? There are so good properties on the market with motivated sellers, it's a situation that won't last for much longer.

To see some of the investment deals we've picked up in this market click here.

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