The aggregate price of Edmonton homes is expected to increase at the lowest rate of nine other markets over the final three months of the year, according to a new market survey forecast from Royal LePage.
It estimates the aggregate home price in the Alberta capital will grow to just over $444,000 in the upcoming fourth quarter of 2023, an increase of four per cent compared to the same quarter last year.
That measures against projected aggregate price increases of 11 per cent in the Toronto area, eight per cent in greater Montreal, and seven per cent in both Ottawa and the greater Vancouver area.
Edmonton’s mark compared to eight per cent in Calgary and Winnipeg, seven per cent in Halifax, and just over five per cent in Regina.
“Edmonton’s inventory remains low, and most new listings are only staying online for a short period of time compared to earlier this year,” said Royal LePage broker Tom Shearer.
Canada-wide, aggregate home prices are expected to increase by 8.5 per cent year-over-year, according to Royal LePage.
Its report was released less than a day after the Bank of Canada hiked interest rates by 25 basis points, an increase that brings the rate to five per cent.
Shearer said the impact of the increase will be mixed within the Edmonton market.
“With interest rate increases now smaller and more incremental, I don’t imagine any additional hikes this year will have a significant impact on home prices,” he said, adding he expects near-flat price growth to end the year.
“Well-priced listings are attracting multiple offers, as buyers are eager to transact before interest rates rise again. Inventory shortages have been compounded by hesitant sellers who are holding off on listing their properties, as they are under the impression that they won’t get as much money today as they would have a year ago.”
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The increase is the 10th in the past 16 months, and increases the lending rate to its highest point in 22 years.
The bank had paused its series of hikes in June, but cited the potential for lingering inflation in justifying the increase.
“Global inflation is easing, with lower energy prices and a decline in goods price inflation. However, robust demand and tight labour markets are causing persistent inflationary pressures in services,” reads a statement from the bank.
It goes on to describe Canada’s economy as having performed “stronger than expected” and that it expects the higher rates to drive down consumer spending even as demand remains high.
Speaking to reporters in Ottawa, Bank of Canada governor Tiff Macklem warned that there may be more increases to come in the future.
“If new information suggests we need to do more, we are prepared to increase our policy rate further. But we don’t want to do more than we have to,” he said.
“We need to see demand growth slow, wage pressures moderate and corporate pricing behaviour normalize.”
The bank’s next rate decision will be revealed on Sept. 6.