For the first time in at least three years, Calgary and Edmonton \u2014 Canada\u2019s hottest housing markets \u2014 are showing signs of a winter cooldown.<\/p>\n
Sales in Edmonton fell by more than 27 per cent in January, compared to a year earlier, while Calgary sales dropped by 15 per cent over the same period. Nationally, home sales also appeared to freeze, falling by 16 per cent last month, the second weakest January since the global financial crisis, according to an RBC report.<\/p>\n
The benchmark price for a home in Calgary fell 4.7 per cent in January, with Greater Edmonton\u2019s benchmark price falling one per cent.<\/p>\n
Typically, dips in sales might be concerning, but Darlene Reid, board chair with the Realtors Association of Edmonton, said the market is finally \u201cbalancing out.\u201d<\/p>\n
Spurred by several consecutive years of population growth, year-over-year increases in both prices and sales were the norm for Calgary and Edmonton\u2019s real estate markets since 2023. Whether it was prices or sales activity, both cities showed remarkable strength, often bucking yearly and national real estate trends during seasonal winter slowdowns.<\/p>\n
Alberta has had a significant slowdown in newcomers to the province, and it\u2019s showing in the housing sector. Compared to January last year, Edmonton has 1,100 more homes for sale compared the same time last year.<\/p>\n
Reid reflected on what was a chaotic few years for the city\u2019s housing market.<\/p>\n
\u201cIt was so hectic because realtors had to be on the ball 24-7. The second a property hit the market, your client wanted to be there within like 15 minutes. So, you were on call 24-7 to try to get that property for your client,\u201d Reid said.<\/p>\n
The effect was that buyers tried to move fast with little time to fully consider a property. Even though sales were busier over that time, Reid believes a balanced market is better for everyone.<\/p>\n
\u201cThis is absolutely better for buyers. I would argue that it\u2019s even better for sellers, because sellers aren\u2019t rushing to get homes on the market, they\u2019re taking their time,\u201d Reid said. \u201cIt\u2019s better for the lenders. It\u2019s better for the home inspectors. They\u2019re not being asked to be out at a home within 24 hours. So, I think it\u2019s taken the pressure off every aspect of this market, which is healthy for everybody.\u201d<\/p>\n
As most of the market balances out, supplies of apartments and condos continue to surge in both of Alberta\u2019s biggest cities.<\/p>\n
\u201cApartment condos, that\u2019s really the segment that will likely continue to see some pressure and it\u2019s not because demand is completely gone. It\u2019s not. It\u2019s just now that demand is being stretched amongst more supply,\u201d said Ann-Marie Lurie, Calgary Real Estate Board\u2019s chief economist.<\/p>\n
Rents dropping<\/p>\n
The benefit of a strong supply of condo and apartment options is that it\u2019s putting a lid on rents, which \u2014 like home prices \u2014 had inflated over the past three years.<\/p>\n
According to a monthly report from Rentals.ca, Calgary rents dropped 5.7 per cent in January, compared to a year earlier, hitting a three-year low. Edmonton also saw a drop in rents by more than 2.5 per cent.<\/p>\n
Lower rents bode well for affordability across the province, but home prices might not follow suit. Lurie said just because sales have slowed doesn\u2019t mean the home prices will come down.<\/p>\n
\u201cThrough that population boom, there was a lot of price growth, and it\u2019s not erasing all of that, but it is definitely returning to levels that are more consistent with longer term trends,\u201d Lurie said.<\/p>\n
Economists at Alberta bank ATB Financial expect the province\u2019s monthly average for housing starts to come down to 45,000 in 2026 compared to the 55,000 average per month in 2025.<\/p>\n
Even with all those new units, neither Reid nor Lurie predict an oversupply.<\/p>\n
Referendum uncertainties<\/p>\n
It would take a significant economic shock to reverse any of the gains made over the past several years for prices to come down in the detached, semi-detached or row-house categories, said Lurie.<\/p>\n
\u201cWhere I get concerned is if we start to see outflows,\u201d she said.<\/p>\n
Even as migration slows in Alberta, it\u2019s still one of the fastest growing provinces in Canada. The trend could stop, she speculated, with a big economic downturn, perhaps triggered by an unfavourable trade agreement with the United States, or if Alberta initiated a referendum to separate.<\/p>\n
Lurie said the uncertainty around either scenario would be problematic, but that a possible referendum is not a front-burner issue.<\/p>\n
\u201cAt this stage, I don\u2019t know if it\u2019s quite top of mind in terms of uncertainty, because we\u2019re not actually getting to a vote stage. If you\u2019re going to a referendum, that\u2019s a very different scenario. And I think you would start to see the uncertainty impact be far more significant,\u201d Lurie said.<\/p>\n
Related<\/p>\n
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