The Alberta housing market has been negatively impacted by rising interest rates as prices continue to fall across the province. Alberta’s average house price for the month of August 2022 was $423,879, up 2% year-over-year but down 3% month-over-month. Similarly, Alberta house sales decreased by 9% year-over-year to reach 6,286. As mortgage affordability becomes a more urgent problem for Alberta homebuyers, the layout of the province’s housing market is also shifting. More Albertan purchasers are opting for condominiums over more costly separate properties. This change is one reason why the average price of a house in Alberta keeps going down.
In Alberta, detached house sales are down 15% annually, while condo apartment sales are up 26% annually. Additionally, sales of semi-detached and row dwellings increased little in comparison to the prior year. While apartments are becoming more popular in Alberta, their price rise continues to lag behind that of other property categories. The average detached house price in August 2022 was $500,601, up 5% yearly and down 2% monthly. Semi-detached homes averaged $406,279, an increase of 5% yearly, while row/townhouses averaged $303,527, an increase of 6% annually and a decrease of 5% monthly. The average price of row/townhouses fell the most compared to the previous month, but has maintained the highest annual price growth among all property categories. At $239,637, condo apartments in the province saw the lowest yearly price rise, rising 0% year-over-year.
Calgary’s housing market remains the most expensive in Alberta, with an average house price of $485,000, a change of close to 0% year-over-year and a monthly decrease of 1%. The housing market in Edmonton followed, with prices decreasing by 3% yearly to $371,599. The yearly price rise in Lethbridge was the highest, at 10% to $334,049, while the annual price increase in Grande Prairie was 6% to $329,287.
Red Deer house prices for the month of August 2022 are up 3% year-over-year to $338,850. Medicine Hat home prices are up 3% year-over-year to $303,894, and Fort McMurray home prices are down 13% year-over-year to $358,982. The housing supply in the Canadian province of Alberta continues to be diverse. Calgary had just 2.24 months of supply in August 2022, a decrease of 21% year-over-year, while Edmonton had 4.96 months of supply, an increase of 15% year-over-year. Fort McMurray’s housing market is weakening, as shown by a 68% YOY rise in supply to 7.09 months, the lowest sales-to-new-listings ratio in the province, the greatest YOY inventory growth, and the largest YOY new listings gain.
Looking at the entire Alberta housing market, sales are down 9% year on year to 6,286 and new listings are down 1% to 9,536. Inventory is down 8% year-over-year and months of supply are constant year-over-year. However, both inventory and months of supply have been increasing during the last several months. Alberta homebuyers’ demand has diminished as a result of the Bank of Canada’s rate rises. Slow sales and more houses for sale have hurt Alberta’s housing market, which could lead to a long-term drop in house prices over the next few months.