Edmonton’s housing markets will grow in 2010, but don’t expect the runaway sales and prices of the housing boom, industry representatives said at a realtors’ forum Wednesday.

The resale market will go through 2010 the same way it left 2009 — stable and steady, Larry Westergard, president of the Realtors Association of Edmonton, said at the group’s annual housing forecast seminar.

Sales and average home prices will both grow moderately, Westergard said.

Residential sales are expected to reach 21,000 homes this year, up about 10.5 per cent from the 19,000 residential properties sold in 2009.

Allowing for a small range of seasonal monthly variations, prices for single family homes are expected to gain about five per cent to $385,000 at year’s end, up from today’s $367,000, he said.

“Most of the rise in the market will be in the single-family-home market,” Westergard said.

“Condos, on the other hand, unfortunately, will continue to be flat.”

Under pressure from new units being built, condo prices are forecast to stay at current levels, for a 2010 average price of about $244,000.

Consumer confidence, along with low interest rates, will continue to drive sales, he said.

“The indicators … are that interest rates will stay the same for most of the first part of the year. By the time the summer ends, we’ll probably see an interest rate rise of one or two per cent.”

Westergard sounded one caution, however. If the current relatively low supply of home listings continues, it could tilt the market toward sellers and boost prices higher than expected, he said. For now, he thinks it’s a seasonal downswing that will pick up later in the year.

There were 4,037 residential MLS listings at year-end 2009. “We would be a little more happy to see 6,000 properties for sale in the Edmonton market.”

But even with strong demand and fewer homes, Westergard doubts the market will overheat as it did leading up to a correction starting in 2007.

“It still has a lot to do with the global economy. There’s still some uncertainty. You don’t see a lot of the projects in the Edmonton area that you did in 2005, 2006 and 2007.

You’re going to get a little bit slower economy and, hence, the industry will be a little bit slower.”

In the new-home market, builders are also much busier than they were at this time last year but remain wary of building at 2005 or 2006 levels, said Guy St. Germain, Edmonton president of the Canadian Home Builders Association.

“We went through hell here in 2008 and the first half of 2009,” St. Germain said.

“We have a lot going on now. Houses are selling. Show home traffic’s up.

“But does this thing have legs? Is it going to continue or is it pent-up demand?”

The Canada Mortgage and Housing Corp. forecasts single-family starts in the Edmonton region will top 4,000 this year, up from about 3,000 in 2009. After a dismal 2009, multiple-family starts will rebound in 2010 to 2,250 units, CMHC forecasts.

“We know that if interest rates go up, it will get slower,” said St. Germain.

“If the CMHC changes their qualification rules and you have to put 10 per cent down instead of five … that’s going to change the market.

If we can get strong job growth and in-migration, we’ll have a stable market which will continue for a long time.”

CMHC senior market analyst Richard Goatcher said he expects to see overall continued improvement in the resale marketplace because of pent-up demand — “stronger sales this year, upward pressure on prices because the market’s more balanced now.

“We’re not in a buyers’ market. In our view, it’s going to be close to the record year of 2006 sales-wise,” Goatcher said.

But a return to a real estate boom is unlikely, he said. “The economic fundamentals just don’t support it. Migration numbers into Alberta are not very strong and job growth is extremely weak.”

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Tags: Housing, real estate