Edmonton and Calgary are among the most affordable housing markets in the country, according to a report released Wednesday by real estate firm RE/MAX.
In its 2020 RE/MAX Housing Affordability Report, the company said both Alberta markets are currently undervalued.
Regina topped the list as the most affordable market in Canada followed by Winnipeg, Edmonton, Halifax, Windsor, Ottawa, Calgary, London, Oshawa and Hamilton.
Sixteen cities were ranked.
RE/MAX’s affordability ranking was determined by assessing the percentage of a buyer’s monthly income needed to carry a mortgage, assuming a down payment of 25 per cent, and based on the forecasted 2020 average sale price per region and the forecasted 2019 average household income.
The report said Calgary real estate prices have been on the decline, experiencing an 3.7-per-cent decrease from 2018 to 2019, and no expected change is expected this year.
With the prices on the decline, Calgary lands in the middle of the pack when it comes to Canada’s most-affordable housing markets.
“Calgary is currently an undervalued market due to the prolonged recession facing the province. The total average sale price currently sits at $484,601. First time home buyers are most commonly seeking condominiums, which range on average from $140,000 to $300,000,” said the report.
“Younger and first-time home buyers are having to rely on support from parents to meet the required down payment and enhance affordability, but have yet to venture into property co-ownership, which has been an emerging trend in other regions.”
The report said Edmonton real estate prices have been declining, experiencing an 3.2-per-cent decrease from 2018 to 2019, and another one-per-cent decrease is expected this year.
“Edmonton real estate is currently regarded as undervalued. The implementation of the Federal mortgage stress test has unintended consequences in how it impacted Canadian homeowners. In Edmonton, the recessed economy has also added to decreased sales, which in turn has resulted in buyers being unable to qualify for a mortgage and paying more in rent than what they would be buying for,” said RE/MAX.
“There is also an evident division between what buyers want and what inventory is available, most of that inventory is not what buyers are looking for. First-time home buyers are looking for newer properties, but much of what is available are homes in need of renovations.”
Mario Toneguzzi is a business reporter in Calgary.
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