Is buying a home becoming less affordable in the province of Alberta? Throughout most of the pandemic, price growth has been subdued in the likes of Edmonton and Calgary. The economy, the energy sector and the Alberta real estate market had been devastated by the coronavirus pandemic.
However, the Alberta housing market started the new year on an upswing that has continued in recent months, with a revival in prices and sales activity. According to the Alberta Real Estate Association (AREA), the average residential price climbed at an annualized rate of 9.9 per cent in January to $443,398, while home sales increased 26.6 per cent year-over-year.
Like the rest of the Canadian real estate market, tight conditions have been the chief factor in this sizzling growth. January saw new residential listings decline 7.3 per cent year-over-year to 7,158 units in Alberta, while active listings fell 27.2 per cent to 14,066 units. Meanwhile, months of inventory, which measures the number of months it would take to exhaust current supply at the present rate of sales activity, plunged 42.4 per cent to 2.77.
Does this mean that home ownership could be out of reach for many homebuyers in cities such as Calgary? While prices may be trending upward, the dream of buying a house, townhome or condo in Calgary is still achievable.
Alberta Real Estate News: Calgary’s Attainable Homes Program Can Help You Buy a Home!
Attainable Homes Calgary is a non-profit organization created and owned by the City. It was launched in 2009 when then-Mayor Dave Bronconnier noticed the home ownership gap and the number of households priced out of the market.
The primary objective became to assist middle-income Calgarians to purchase a home. Over the last decade, the initiative has become so successful that the program has now partnered with nearly a dozen builders, eight financial institutions, seven law firms and three mortgage insurers.
“So, if moderate-income Calgarians (who do not currently own a home) want to buy one, why aren’t they? Not shockingly, the reasons are financially based: they don’t think they can afford the costs of home ownership; they can’t save a down payment, and they believe prices are too high,” the organization said in a news release.
Attainable Homes Calgary helps resolve this common setback.
So, how does it work? Here is a step-by-step process:
- Get started by registering with Attain Your Home.
- Connect with mortgage specialists and go through online education.
- Receive your pre-approved mortgage.
- Browse through the list of available homes and pick which one you like.
- Pay $2,000 and receive the rest of the down payment from the program.
That’s it. If you choose to leave the program, you can pay back the down payment loan and receive a portion of the appreciation growth in the home’s value.
Who qualifies? Here is a breakdown of eligibility:
- Families: Maximum annual household income of $104,000.
- Couples: Maximum annual household income of $94,000 without children living at home.
- Individuals: Maximum annual income of $84,000.
- Assets: Your assets are less than 20 per cent of the home’s purchase price and up to a maximum of $50,000.
- Residence: Your home will be your permanent and only residence.
Affordability a Real Issue in Calgary Real Estate Market
During the COVID-19 public health crisis, Calgary had been one of the most affordable real estate markets in Canada. While many major urban centres and small towns became out of reach for prospective homebuyers, Calgary and other parts of Alberta favoured them. But recent trends suggest that the region is now becoming more expensive, with many people flocking to this part of Canada.
From rising demand to diminishing inventories, the Calgary housing market is hot, without any respite in sight.
According to the RE/MAX 2022 Canadian Housing Market Outlook Report, the Calgary real estate market could see a 2.5-per-cent gain in the sale price by the end of the year, while the number of sales is expected to grow four per cent.
Meanwhile, the Edmonton housing market is could experience a seven-per-cent jump in average residential prices and a five-per-cent boost in sales activity.
“The Calgary and Edmonton markets shifted from balanced conditions in 2020 to seller’s markets in 2021, which [RE/MAX] brokers and agents in the region expect to continue into 2022. This is attributed to heightened demand prompted by the inter-provincial migration trend that took place throughout 2021, which saw many homebuyers from Ontario and British Columbia driving demand high, while supply remained low,” the report stated.
For now, rock-bottom interest rates, ample stocks, and prices below the national average are allowing many Canadians to buy homes. How long this will be the norm is unknown right now.