We received a question in response to our "you asked us" post from another reader (Kendal). The question related to a comment I made about types of condos and areas that are performing better than others.
Kendal asked me to elaborate, and since this information may be relevant to other blog readers who own condos in Edmonton we're posting a response. So let's start with the data I collected:
- Sales stats are between April 23-November 23 for the years 2007 and 2009
- All are 2 bedroom units
- First sample area is north central Edmonton but not downtown (we refer to it as zone 8, Central Mcdougall, Queen Mary Park). It is for 2 or more bedroom apartment units built before 1985 that were converted to condos. The extremely low inventory in 2006 led to the successful conversion of these units.
- The second sample is for newer, apartment style condos in the South West (zone 55 and 14 – Riverbend, South Terwillegar, Macewan, Rutherford)
- The third sample is for hi-rise condos in downtown edmonton (zone 12)
- The fourth sample is for newer apartment style condos in the University area (zone 15 – Garneau, Strathcona, Mckernan, Allendale, Parkallen, Belgravia etc.) This one's for you Kendal
A 20% difference in average price but the main difference is the level of demand. There is a significant difference in sales comparing the two with 2009 looking anemic (there were 60 sales in 2007 and 12 in 2009). You'll notice a similar price drop but a huge difference in demand to the central condos – 54 sales in 2007 vs. 111 in 2009. The increase in sales is probably due not only to increased demand, but increased supply in 2009 – there are a lot of new condos built in the southwest over the past year. There is only 3 months supply in the southwest compared to 5 months supply of condo conversions in zone 08. Now here's the gist of what I was saying when I said some condos were doing better in some areas. The average sale price for downtown condos is up mainly due to sales in higher price ranges, but this has been driven by strong demand (almost double the same period in 2007). All in all demand is up in most areas, and this is what has chewed through the inventory and returned the market from free fall to stable with signs of potential improvement. It should be noted that this is a broad look at the areas and doesn't represent every price range and type of condos in those areas. We are looking at average sale prices which can be very misleading – the average price change in an area does not mean that every property has gone up or down correspondingly. If you have a question or if you'd like to talk us about your real estate concerns let us know.
