The housing market is showing signs of recovery on a national basis. The Canada Mortgage and Housing Corporation reported that more than 262,000 housing starts were made across the country in August of 2020, and that’s the highest monthly total in 13 years. It’s not simply a number that shows improvement over a few coronavirus-ravaged months; it’s a generational high.
But, Alberta has been slow to follow this trend. According to the Alberta government, housing starts were down 14.8 per cent in this province from January to August of this year, compared to the same time period in 2019.
That’s definitely not a rosy picture, but one to be expected as the province wrestles with low oil prices and, well, COVID-19.
But what are developers and builders seeing in the Edmonton market at the macro and micro levels?
Edmonton offers great value compared to other Canadian centres when it comes to housing. Statistics from the Realtors Association of Edmonton show that the average price for a single-family home in August of 2020 was $447,000, while condos sold for an average of $221,000.
That’s still significantly less expensive than Calgary, which reported average prices of $551,446 (detached) and $250,664 for apartment-sized properties — over the same time period. And we’ve all heard how badly Calgary has been hit by the oil slump.
But that also presents a challenge for developers and builders, who are under pressure to keep housing costs down, while land costs rise.
Andrew Harbinson is co-owner of Metro Enterprises, which specializes in infill within the city’s borders.
While he said the company isn’t actively soliciting new business through the COVID pandemic, what he’s seen in recent builds is that clients want all of the amenities that come with a character neighbourhood, but want homes that are modern.
“Lots of glass, angles, clean finishes, that’s what we’re seeing,” says Harbinson.
Why rebuild rather than renovate? Harbinson says the homeowner needs to weigh if the renovation will add value to the home, and if the renovation is easier to pull off than a rebuild. For example, in a custom build, a client can ask for the builder to provide spaces for his or her needs. If someone wants a media room, it can be wired for all the latest gadgets. If someone wants a home gym, that can be set up from scratch. But, in an existing, older home, is it worth having to rewire for a media room? Does the space work for a home gym?