Listing Inventory Lowest We’ve Seen in 5 Years in Edmonton in January

The REALTORS® Association of Edmonton released their monthly report on the housing market in the Greater Edmonton Area today with the headline "Local housing sales and inventory up in stable market."

I very rarely do this, but I have to disagree with our Association's take on the housing market today. In their release (and their headline), they make a lot of comparisons between January and the month previous, which is pretty much irrelevant; seasonal changes basically dictate that sales and inventory are higher in January than in December. What really matters is the year over year changes, so, as always I'll focus on comparing this January, to Januarys past, to gage the real market in Edmonton. As you can see in our market snapshot, sales and inventory are both down compared to last year:

MarketSnapshotJanuary2014
Market Snapshot January 2014

*On a side note, Aspen Gardens and Rutherford made our Top 10 list for the first time for most visited neighbourhoods on EdmontonRealEstate.pro, which is seeing a 30% increase in traffic over last year.

Sales are slightly down from last January, and as you'll see in my analysis below, I believe this is not do to lower demand, but lower inventory. Buyers are generally not willing to settle for less at this time of year, and will wait until a home comes on the market that is right for them. There were 885 sales through the MLS system in the Greater Edmonton area in January, down 3.3% from last year.

Sales
Sales

The average residential sale price was $347,847 in January, up 5.9% from last year. The median sale price was $329,500, up 4.6% from last year. While 4 homes over $1 million have already sold this year, half the sales of single family homes were under $385,000.

Average
Average

And now we get to the real story... look at the inventory! We are starting the year off with the lowest inventory we've seen in at least 5 years. At the end of January there were 3,537 listings for buyers to choose from, 5.5% less than last year (when we were also commenting on the low inventory). With similar conditions last year we saw the average price rise 8% between January and March. If that happens this year we will hit a new record average price (actually prices would only have to rise 2% to meet the previous peak of approximately $355k).

Inventory
Inventory

As promised I took a closer look at what's happening in different price ranges. It is a seller's market if you are selling a single family home for less that $450,000, or a condo under $150,000 with less than 3 months of inventory available. There is a balanced market for houses between $450,000-$500,000 and condos between $150,00-$300,000. 

AbsorptionJan2014
AbsorptionJan2014

Lastly, there were 1842 new listings in January, which is pretty typical for this time over year.

NewListings
NewListings

We know our readers are well educated on the real estate market in Edmonton. I'll let you decide who is right - should we compare month to month, or year to year? Are sales and inventory up or down?

About 

Sara MacLennan is the Director of Marketing at Liv Real Estate and a licensed Real Estate Associate. The bulk of Sara’s experience and wealth of expertise lies in on-line technology and marketing both for agents and consumers. Sara is the former National Director for Interactive Marketing for Coldwell Banker Canada where she was responsible for an extensive training program traveling to offices across the country training agents and brokers on marketing and technology. Find Sara on Twitter @edmontonblogger.

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6 Responses to “Listing Inventory Lowest We’ve Seen in 5 Years in Edmonton in January”

  1. karlhungusNo Gravatar 04. Feb, 2014 at 5:54 pm #

    Seems pretty clear to me that its best to compare year over year. Who knows what kind of effect christmas and the holidays has on the real estate market so it doesnt really make sense to look at the numbers from december to january. Apples to apples and all that.

  2. 123kidNo Gravatar 05. Feb, 2014 at 10:26 am #

    Great job Sara; appreciate this

  3. TonyNo Gravatar 05. Feb, 2014 at 12:46 pm #

    Looks like the data only goes back 5 years. If you look at data prior to 5 years ago is it the lowest inventory in more than 5 years?

    • Sara MacLennanNo Gravatar 05. Feb, 2014 at 1:23 pm #

      Unfortunately I can’t go back further than 5 years. Last year the board changed the boundaries for what is and is not included in their reports, and they updated all the stats going 5 years back to reflect the new boundaries. So even though I have stats going back further than that, it would be comparing apples to oranges if I plotted further back on the graph.

      • wsnNo Gravatar 05. Feb, 2014 at 4:46 pm #

        It would make more sense if you normalize (i.e.divide) the inventory number over the total population.

  4. ChuckNo Gravatar 08. Feb, 2014 at 8:14 am #

    Excellent analysis Sarah. Year over year, separate SF from condos as you do.