CMHC forecast points to Edmonton real estate enjoying strong year

The good times for Edmonton real estate should keep rolling for a few more years, a new report forecasts. Canada Mortgage and Housing Corp. released its 2025 housing market outlook that predicts Edmonton will remain among the nation’s most active markets, driven by its affordability, likely this year and over the two following years.

“By historical standards, 2025 will still be a strong year,” says Michael Mak, a housing economist with CMHC.

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But it likely won’t surpass the activity last year, which saw record new housing starts and transactions in the resale market, and historically strong price growth.

The overall report for Canada points to slowing immigration — as the federal government seeks to decrease its allowances for newcomers, in part, to slow housing demand — as a headwind for housing demand. Yet Edmonton, due to its affordability, will still draw a lot of inter-provincial and international migration, the report notes.

What’s more, the resale market remains tight with high demand.

Edmonton saw nearly 28,600 resales in 2024, CMHC reports.

On the new home side, the market also saw record activity with 18,384 starts, driven by more than 11,400 multi-family starts.

“Most of the construction has really shifted to multi-family.”

Mak adds that Edmonton — like all Prairie markets — has an advantage over larger centres in Ontario and British Columbia, which have higher prices, lower supply and less land to develop.

“Yet even though Edmonton and Calgary have a lot of land, and single-family detached homes, especially in greenfield lands, are easier to build than other big cities, you can only build so much.”

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Mak adds that multi-family rental could see less development in 2025 due to rising vacancy. Already, CMHC data from the fall shows vacancies increased to 3.1 per cent in October from 2.4 per cent in the same month in 2023.

That said, monthly average rents also increased from $1,398 for a two-bedroom in fall 2023 to $1,536 last fall.

Rising rents could be one driver for more development. But they could also be an impetus for renters to jump to ownership, says Alana Riley, head of mortgage, insurance and banking at IG Wealth Management in Calgary.

“There’s cautious optimism in rates coming down,” she says.

IG recently issued its Financial Confidence Index showing that more than half of renters expect rent to increase. With mortgage rates already having fallen about 100 basis points from last year, renters could find ownership more affordable.

Still, higher prices remain a challenge.

Riley notes prices increased nearly 20 per cent in Alberta in 2024, but average prices in major cities remain below the national average of about $709,000 in January.

CMHC’s report shows that Edmonton’s average price was about $423,000 in 2024.

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In a tariff challenged world, which would dampen demand, prices could decline slightly. The average aggregate price could drop to about $420,000 with still historically strong sales at about 26,000. The higher forecast suggests record average prices by year’s end of $460,000 and record sales at 32,000. In 2026 and 2027, modest price growth and slightly lower sales are forecast for the best scenario in CMHC’s outlook. The low sales and price forecast point to slight declines for both in the two years following this year.

Starts also could surpass record activity this year and even move higher in 2026 and 2027, best case. Or they could drop by more than 4,000 in a tariff-challenged environment, it notes.

It also predicts that vacancies could increase, leading to rent moderation.

Edmonton’s trajectory in many respects could mirror Calgary’s last year, which has slowed from its 2022 peak, Mak says.

“The market and economy in Edmonton is really tied to Calgary, where we’ve already seen a minor slowdown.”

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