ReE/Max predicting a seller’s market in Edmonton for 2025

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After a hectic year in Edmonton’s housing market, Re/Max’s latest report predicts that the pace will continue in 2025 with prices expected to climb 10 per cent in the average sale price across all listing types.

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In its 2025 Canadian Housing Market Outlook report, released Tuesday, Re/Max predicts both a rise in the price of homes and an increase in sales expected to rise by four per cent during the new year. The report shows that the price of homes increased by 7.7 per cent this past year across all property types, bringing the average sale price to $431,839 from $400,833.

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Don Patterson, managing partner and broker for Edmonton’s Re/Max Excellence, said despite the rising prices Edmonton’s affordability is still its main selling point in the real estate market.

“We have this huge affordability advantage, and that — even though prices are up possibly 10 per cent during the past year — we still have by far the most affordable housing in Canada,” Patterson said.

To support his point, Patterson referenced a report by RBC Economics released in October showing the share of household income needed to cover home ownership costs across Canada. Edmonton led the country at 33.7 per cent, with Calgary coming in second at 42.5 per cent of household income. Home ownership costs in both Albertan cities fell below other major Canadian cities like Vancouver, Toronto, and were even below the national average, which were 98.6 per cent, 77 per cent, and 59.5 per cent, respectively.

The relative affordability, according to Re/Max, means that first-time home buyers are expected to command the market in the new year, especially in the $350,000 to $450,000 range. Patterson explained why first-time buyers are expected to drive the activity.

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“You’re seeing interest rates starting to come down. But the Edmonton market was really strong from Jan. 1, even with rates in the five per cent range,” he said.

With lower prices than other major markets and interest rates decreasing, more people in Edmonton will be in a position to buy their first home than people in many other places in Canada.

Patterson said that Edmontonians can still expect to see persistence of the seller’s market in 2025, which will be welcome news for homeowners looking to get the best return on their investment.

But for those looking to buy, the 10 per cent price increase predicted throughout next year may be tougher to manage.

Patterson said the rise in prices has come primarily from increased activity and lower supply. On the latter, he said a balanced market would be 50 per cent sales and 50 per cent new listings. Edmonton has consistently tipped towards more sales than listings over the past several months, hitting a fever pitch of 84 per cent, which was up from 70 per cent in September.

Re/Max also notes in its report that construction is currently trailing the high demand that is “primarily being propelled by homebuyers from Ontario, followed by British Columbia.”

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With a low supply, high demand, and lower interest rates, the market seems at the outset ripe for an even greater runup in prices throughout next year, but Patterson expects the price increases to come gradually.

“If there’s a 20 per cent run up in the first few months of 2025, I’d have some concerns on that,” said Patterson.

“But if we’re seeing modest growth month over month, and that’s generally what it has been in the past 12 months, then I think this is certainly sustainable.”

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