Western Canada's economic powerhouse set for stand-out growth

by Steve Randall12 Jun 2019

A brighter economic outlook and growing job creation is helping the housing market in the Greater Edmonton Area position itself for growth.

A new report from Marcus & Millichap points to a market that will stand out in 2019 and achieve outsized growth, thanks to a diversified economy that is creating jobs that will drive housing demand.

There were 34,400 jobs created in the 12-month period ended March 2019; employment rose 4.5% in that period, compared to a 0.6% decline a year earlier.

And the jobs are in a variety of sectors including health, technology, finance, and provincial government.

Despite a rise in unemployment to 7.1% in the first quarter of 2019, report author Michael Murphy says there should be a 25,000 increase in jobs this year.

With young professionals moving into the area, the report highlights the investment opportunity from rentals, the preferred option of this inflow due to the flexibility of renting.

Saving for down payments

However, with rents typically $300 per month lower than the mortgage payments on a benchmark priced single-family home ($372,100) there is scope for these newcomers to the region to save for a down payment while renting.

Average rents are increasing though with landlords seeing a 2.6% increase in their return in 2018 due to tightening availability. This compares to a 1.2% decline in average rents seen in the previous year.

Investor demand has also pushed prices higher with a near-33% rise in the average price to $173,400 per unit.

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