Red Deer saw the fourth largest increase in the price of a home in the past year compared to other Alberta cities.
The average home price jumped nine percent in Red Deer, which pushed prices up by $28,083 to $340,114, according to real estate advisors at calgaryhomes.ca, who analyzed data from the Alberta Real Estate Association and the Canadian Real Estate Association from February 2023 to February 2024.
Calgary home prices saw the biggest spike at 15.1 per cent, a leap of $76,505 in price, to drive the average home price to $583,160.
The national average house price was $4,400, so house prices in Calgary have skyrocketed 17 times the national average.
Medicine Hat came in second in the province with a 14.2 per cent climb, or $42,430, so the average price is now $341,232. Edmonton ranked third, with an increase of 10.3 per cent, or $38,049, making the price $407,458.
Dustin Quirk, Red Deer Polytechnic instructor at the Donald School of Business, Science and Computing, said it is not surprising that Red Deer’s housing market would lag behind Edmonton and Calgary, as newcomers are often attracted to larger cities.
“While Red Deer may be Alberta’s best-kept secret, I would expect that the local housing market is primed for further growth as our city increasingly becomes an attractive landing spot for people coming to experience the Alberta Advantage,” Quirk said.
He said in Alberta, employment growth and strong migration, both international and from neighboring provinces, are driving the housing and rental markets to new heights. Alberta is somewhat unique in Canada as both employment and in-migration are driven by the price of oil, which has been relatively strong.
“Just last year, Alberta set a record for people moving here with just over 200,000 people becoming Albertans. That is like adding two Red Deers to our province in a single year,” Quirk said.
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Scott Robinson, executive director of Red Deer & District Chamber of Commerce, said in the last three years Red Deer has not seen a lot of new inventory and fewer homes on the resale market. Construction is now starting to pick up with a few new developments.
He added that at this time of year, the resale market typically starts to ramp up but the number of homes available is still low and homes that go on the market are sold quickly.
“Pent up demand is putting pressure on the market and obviously there is a catch-up effect,” Robinson said.
Having a demand for housing in Red Deer is good, but it also makes affordable housing more of a challenge, which probably has some impact on rental rates, he said.
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Quirk said rising housing prices in Alberta and Red Deer are a double-edged sword.
“It’s great for existing homeowners who are seeing an appreciation in what is likely their largest asset, but it is making housing less affordable for first-time buyers who are trying to start climbing the property ladder.”
The data showed Lethbridge home prices came in fifth with a 7.1 per percent surge, or $24,981, making the average price in that city $376,833. Grande Prairie ranked sixth with a 4.1 per cent increase, or $12,675, for an average price $321,826. Fort McMurray was seventh with a 2.5 per cent increase, or $8,446, for an average home price of $346,274.
szielinski@reddeeradvocate.com
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