Edmonton real estate agents are hopeful the city's condominium market is rallying, with sales ticking up after a decade-long slump.
The latest numbers from the Realtors Association of Edmonton show apartment-style condo sales jumped 50 per cent in January, compared to the same time last year.
And the industry group noted growing demand for condos in 2023, pointing to high interest rates that are driving would-be homebuyers to cheaper properties.
Agents say they're noticing the change after a long stretch in a stagnant market, where sellers often watch their condo unit, priced far lower than what they paid, sit for months without an offer.
"Even over the last couple months, I've seen something we haven't seen since maybe 2007, which is bidding wars on condos," real-estate agent Sara Kalke told CBC News.
Kalke said that's still not a common scenario, but growing demand started to be especially clear in the second half of 2023. Recently, she added, she dealt with a four-way bidding war for a condo in southwest Edmonton.
"I was utterly floored," she said.
"It was very well priced, but it just hit the market and there was a ton of demand … All the agents who were involved, we kept saying to each other, 'What's happening?'"
The benchmark price for apartment-style condominiums in Edmonton climbed by five per cent, year over year, at the end of 2023. Statistics from the Canadian Real Estate Association (CREA) show that's the first increase to close out the year since 2014.
Edmonton's condo prices had been on a steady slide after hitting a high in 2015, tumbling nearly 11 per cent between 2013 and 2023. In comparison, the same time period saw condo prices rise about 25 per cent in Calgary and 75 per cent in Montreal. In the Toronto and Vancouver areas, benchmark prices more than doubled.
As a result, you can buy a condo unit in Edmonton for less than $200,000, compared to about $750,000 in Vancouver, and $680,000 in Toronto. In Calgary, the benchmark condo price has climbed to almost $330,000.
"You can buy three benchmark price condos in Edmonton or the average benchmark price of a condo in Canada," Kalke said.
"So people from other provinces who are either priced out or who want to make an investment have been looking at buying in Edmonton more than ever."
Interprovincial migration, rising rent are both factors
Jackie Ng, an Edmonton broker whose firm Arivl focuses on first-time buyers and condos in core neighbourhoods, said oversupply has been an issue in the city's condominium market, and that's part of what has historically kept prices low.
The relative affordability of single-detached homes also means many buyers weren't starting with condos as their first choice, but higher borrowing costs are changing those calculations.
Ng said he's seeing a significant spike in interest from out-of-province buyers looking at relocating to Edmonton, and they're considering condos and townhouses too.
The rising cost of rent is another potential factor, sending people into the condo market. The Canada Mortgage and Housing Corp.'s latest rental market report puts the monthly cost of buying a condo at about 14 per cent of household income — by far the lowest ratio among the rest of the country's biggest cities.
Meanwhile, rental vacancies are down for the second year in a row, and the city saw the average rent for a two-bedroom apartment increase to about $1,400 in 2023.
"With rents rising quite rapidly, many tenants might consider transitioning to homeownership," the report says.
"This move could lower their monthly shelter costs as home prices, especially for condominiums, are quite low. ... The primary hurdle remains the down payment, especially for first-time homebuyers."
Royal LePage Noralta broker Tom Shearer said he expects to see continuing interest in Edmonton from newcomers, and that means more activity in the condo market too.
"If they drop the interest rates, let's say toward the end of the second quarter [of 2024], I think that's only going to pour gas on the fire in our real-estate market."