2023 Edmonton Real Estate Market Outlook

Rimrock Real Estate


2023 Edmonton Real Estate Market Outlook

Several dominating themes emerged in 2022 that had a significant impact on the Canadian housing market. We will dive into these core themes - detail how they impacted us in 2022 and suggest how their trajectories will steer us in 2023.

Interest Rates

The initial story for 2022 was the easing of Covid restrictions which dominated headlines the previous 2 years, coupled with the end of Covid benefits and ensuing inflation and mortgage rate hikes to counter. There was a total of 7 interest rate hikes in 2022 bringing up the bank prime rate from record lows of 0.5% to 4.25% in one year - some of the fastest and most consistent hikes since the early 80’s. These interest hikes helped to slow sales in Edmonton by 26.2% year-over-year (For the record we will in this article always look at year-over-year numbers to give us a better impression of a trend - rather than fluctuating month-over-month numbers). A consideration when discussing the impact of interest rates is the delayed nature of the effect of these rate increases. As we discussed from the previous years outlook, with up to 120-day rate holds available from lenders, it sometimes takes half a year for these rate increases to be felt in the market and even longer before influencing pricing trends. With core inflation finally starting to decrease to more natural and comfortable levels, we can anticipate a gradual softening towards the end of 2023 to the Central Banks increases and at least some competition amongst banks to offer some competitive rates as their lending volumes decrease.
As it relates to average prices, it is also important to note that the raising of interest rates has changed the product mix of homes being sold. With fewer luxury homes selling and more affordable homes selling through the year – which skew the figures. For a more accurate representation, the HPI or home price index is used and this factors in the variables and accounts for this changing product mix. The average price change in Edmonton for 2023 saw a 4.6% decrease year-over-year, but, when using the HPI, it was only 0.9% decrease. Condos also represented a disproportionate share of the decrease as they dropped on average 4.6% compared with 1.9% for Single family and semi-detached inventory. These prices remained quite stable compared to 2021 which was an outlier and record setting year where we saw cheap money flowing into the market. 

Supply Chains

Its not getting any cheaper to build new. The supply chain disruptions over the past few years and the war in Ukraine have driven up material and labour costs on most materials and labour involved with building or renovating. Although many of these prices have edged off their peak don’t expect them to come down to pre-pandemic levels – what does this mean – that the cost involved to build or renovate has risen – and this will inevitably be passed on to the consumer. As inflationary measures begin to gain traction and core inflation decreases, to think that this will be reflected in the end value of your new home or renovation project is a stretch. Both the value of land to increase the volume of new homes and increase the density has increased, so to has the materials to construct these homes – we anticipate new inventory pricing to remain above levels seen last year – except for inventory constructed in the peak and now adapting to sales in a softening market. Builders may look to hedge the risk of spec inventory and work towards implementing better pre-sale strategies which may help to reduce new inventory levels next year.

War in Ukraine

An underlying theme effecting markets, supply chains and immigration that in turn directly and indirectly effects pricing and inflation was the war in Ukraine. In 2023 we expect this ongoing conflict will impact the Canadian housing markets through increased immigration and policy decisions aimed at further isolating Russia and bolstering a more protectionist domestic supply chain.


Immigration - both interprovincial and international immigration into Alberta were at record breaking levels in 2022. For the third quarter of 2022 (latest data that is available) Alberta led all Canadian provinces with a positive net interprovincial migration of 19,285 people – strongest gain in 40 years. Another record was set by the international immigration to Alberta where we saw over 35,000 new Canadians come to Alberta. That brings the total net increase of 52,582 in the third quarter alone.

Economic Strength & Jobs

The unemployment rate in Alberta finished the year at 5.6% - the lowest year end figure since 2015. The province continues to add jobs and diversify into technology both within clean energy and agriculture, film and tourism. These trends will continue and help the province be less dependent on the volatile oil and gas markets. Combined with strong oil and gas sector performance in 2023 and a barrel of oil holding above $70, Alberta will be well positioned to weather the economic headwinds and recession that are forecasted.

Foreign Buyers Ban + Anti-flipping tax

Foreign buyer’s never made up a notable percentage of investors in Edmonton and although this may take some additional wind out of the sails it is not expected to have any considerable impact in the resale housing market in Edmonton. New high rise condo projects may feel an additional pinch if they traditionally had an out of country investor base. The anti-flipping tax is also not considered to have any substantial impact in the markets in Edmonton.

2023 Forecast

Edmonton in 2023 is starting the year in buyers market territory with a little over 5 months of inventory. Inventory levels will play an integral role moving forward in 2023 and if a flurry of listings hit the market with declining sales volumes, we could see decreasing price pressure. Condos will likely be the worst performing product segment and the demand for more affordable single-family homes with no condo fees will be the highlight. We anticipate the product mix trend to continue from 2022 with more affordable inventory selling faster and in higher volumes than higher prices homes. Condos will perform the worst in terms of prices but may maintain reasonable levels of sales volume because of their affordability factor. Single-family homes or attached inventory with no condo fees will be highest in demand especially under $500K as they give the biggest bang for the buck.
With CREA forecasting prices to decline across most markets in Canada on average by 6%, Edmonton will likely follow trend, however, not to the extent of other markets and likely see a lesser decline. There will be nominal declines in price and sales volumes and other indicators will likely remain around 10-year averages.
Again, this is very dependent on product type, neighbourhood and location within that neighbourhood. If you would like an accurate indication and strategy for your specific situation please reach out directly or fill out the home evaluation form: Home Valuation


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