I was chatting with someone the other day on our cool little chat doo-hickey-thingy (look down and to your left) and they wanted to know what areas of the city were churning through the inventory and what areas were moving slower. So I did some searching in the MLS database and got the answer.
The chart below shows the absorption rates for different areas of the city, as well as for different types and price ranges of properties. The absorption rate is the number of listings currently on the market, divided by the number of sales in the pat 30 days, and it tells you how many months it will take to sell the current inventory if the rate of sales stays the same.
I thought the results were quite interesting. First off,the fastest moving properties within Edmonton are in the University area and south east (right next to the University area) with 4.4 months worth of inventory. Now, this makes a lot of sense since a lot of parents are up in Edmonton looking to buy properties for their kids while they’re in school. Overall it seems that the southern part of the city is performing better than the northern areas.
It seems that Sherwood Park has everyone beat with 3.7 months worth of supply, and I think this is due more to lower inventory than higher demand. Stony Plain on the other hand has the worst absorption rate of 11.5 months, this should have an impact on prices there and is likely due to the distance from Edmonton (typically the closer you are to downtown the better your property will do in down times). Funny thing is the central area has one of the higher rates, and I think this is because of all the new condos and condo conversions on the market in the area.
In terms of price ranges, it appears that $300-$400k is the place to be as a seller, even with the high level of competition in that price range. Bungalows and bi-levels seem to have an advantage over 2-stories; I feel the split levels may be exaggerated because of the small sample size. Single family homes have the advantage over condos.
Just so everyone is clear, I included condos and single family homes (no land, rural or recreational properties) in Edmonton, St. Albert, Spruce Grove, Stony Plain and Sherwood Park. I broke up the city into areas which you can see on the map below (click the map for a larger image). I’m sure some will disagree with my generalizations but that’s the best way I could think of to do it.
What areas are selling best in any particular city is a very good topic.
In fact, it should be one of the 2-3 primary considerations looked at during the initial purchase.
This information is very interesting – thanks for putting it on your blog. Can you please do this every month?
Why are condos always broken out? Are they also included in the area breakdowns, or are the area breakdowns only houses? I’d be very interested in an area breakdown of condos in particular, as that’s what I own.
***Condos and signle family homes are included in the area break downs and the price range break downs. Thanks, Sara.***
Thanks for all the great info it sure helps someone who is getting in the market. Keep up the good work.
Hi Sara,
I live in South West Edmonton within less than 500m to Heritage Mall. In 2009, a LRT station will be added to the existing line. I would like to know what the impact is going to be on our condo. Do you think it should have an impact on the condos and SFH in the area?
Thanks,
There was a development in Stony Plain that was obviously only bought by flippers and they are all trying to sell now that they are being completed, I think that really jumped the number up.
LRT Impact
Many people do not like having the LRT close to their house probably because of the look and noise. They feel this will decrease the value of their property. I do believe in time that it will probably increase the value not decrease it. The LRT will actually bring more buyers to your area. If you want to live downtown because you want to be close to work (ie not drive) you will now have a whole buch of new options. I could be wrong but I think owning property (condos more than SFH) close to the LRT is going to pay off better than an area like far west or south west.
Sara and Sheldon,
Thanks for the hard work. I always come back here to get the real data and reliable info.
This may be unrelated, but we needed Ned to have a good laugh at him. Why did you folks ban it? This Ned guy would have been the entertainment of the week.
Stony Plain had been one of the fastest growing communities around Alberta and one the fastest around the capital region. There were many factors such as Realtor dominated town council that approved every possible development in the last few years. True, there was demand, obviously due to over-speculation. With upwards of 8-9 sizable townhouse and condo developments in Stony Plain that have come online or will come online, there will continue to be over-supply. Combine that with high gas prices there will be little absorption anytime soon. People bought in Stony because of the small town feel, and beautiful surroundings, but now they want to leave due to the high cost of driving their SUV’s to downtown Edmonton. I live in a new subdivision here, and the hustle and bustle of swamper trucks, and concrete trucks has slowed to a snails pace. It use to be that Sunday afternoon you could see tradesmen working everywhere to complete projects on time. Now you could count on your one hand how many tradesman you may see in month.
I am definite no bear, and its fools gold to predict what will happen in Alberta, but there is a complete turnaround in this province.
I have one more story, a friend of mine renos condo conversions, and he was recently found that the developers are finally slowing down. When the market started to change at the end of last spring I have been asking him whether he is still busy. Finally in the last little while these developers have slowed or stopped their redevelopment projects. Finally people are getting the hint that there are few buyers.
Carliecat,
I agree with Anon. Long term I think the value of living near the LRT will increase. I believe there is an economics study to that effect, sorry I do not know the source.
Anyway, energy costs are a reality. The days of cheap energy are over. People are going to rethink their driving habits, where they live, where they work. The suburbs were built based on our previous values with fossil fuels. Those are going to change.
I believe lIving near public transportation is going to attract buyers who don’t want to spend thousands of dollars and hours in traffic each year commuting. Then there’s the whole parking issue. Parking in my near downtown office has risen 68% in just 2 years.
I recently moved closer to downtown, so I could walk to work. I love the accessibility of the bus lines, LRT, and simply walking to buy my groceries. It feels good to park the car and realize, I haven’t driven it for a few days! My personal belief, urban centres are going to be more valued as time goes on. And suburban centres that have accessible public transportation are going to do better than those that require single family vehicles to make the commute everywhere.
PS – Yes, I do miss my yard and garden from my house in the ‘burbs
But I am appreciating public parks, potted plants on my deck, and just walking more. Maybe when it’s -30C I’ll think differently!