The sun may be setting on 2021, but it certainly is not setting on the Real Estate market. Canadian home prices are expected to rise a staggering 9.2% according to a housing market outlook report published by RE/MAX on Wednesday December 2, 2021.
Let’s focus on Edmonton and take a little look and see what may be causing such a projection.
Well Edmonton is projected for a 7% increase in home prices in 2022. As you can see the average sale price rose 4% in Edmonton from $362,447 to $377,848 in 2021. The root of that lies in the number of sales, which you can see rose a whopping 48% from 14,543 sales in 2020(Jan.1-Oct.31) to 21,520 sales in 2021(Jan.1-Oct.31). There just isn’t enough housing inventory to keep up with the current sales numbers, let alone the 5% increase in sales that is projected for next year.
I am nowhere near an economics major, but supply and demand is a pretty simple concept to grasp. If the supply is low, and the demand is high, prices go up. Well we have extremely low supply, with very high demand, so the prices will continue to climb. Luckily, we do live in one of the most affordable markets to buy a home, as I covered previously here.
With housing inventory at possibly an all time low in many markets across the country, these projections feel a little bit like a foregone conclusion than a projection.
-Thomas