“An advantage we have going for us is literally anywhere in BC… you can’t afford to live there. GTA the same thing.”

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Edmonton could see a boom in multifamily housing projects in the coming years to meet the city’s expected population growth, developers say.

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“Edmonton is the cheapest big city in Canada,” said Rohit Gupta, CEO of the Rohit Group of Companies.

“The demand for multifamily has a really positive future for the next decade.”

Gupta made the comments Thursday at a panel discussion in Downtown Edmonton put on by NAIOP, the Commercial Real Estate Development Association.

He says developers are aware of changing trends that could see Edmonton’s population explode in the coming decades, and that more multifamily developments are needed to keep pace.

“We’re actually already seeing quite a bit of demand increasing from the consumer for multifamily,” he said.

In its spring outlook for the Edmonton area, the Canada Mortgage and Housing Corporation (CMHC) says it projects starts of multi-family homes will continue to outpace those of single-detached homes by as much as 75 per cent this year and remain about the same through 2024.

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The most recent numbers from the Realtors Association of Edmonton show that anticipated growth may already be happening.

Condo unit sales increased by far the most of any kind of housing measured over the past 12 months. Sales of condo units grew by 67.1 per cent over the past year, compared to 21 per cent for single-family homes and 54 per cent for duplex rowhouse units.

Condo sales were up 62.9 per cent in March from February 2022, also the largest monthly increase of the three categories of housing.

“Customers have a lot of choice here,” said Gupta.

Coming population boom

Developers say they expect demand for those units to be driven by growing migration to Alberta from other, more expensive parts of Canada.

“We are quite bullish on Alberta,” Emmett Hartfield with Intelligence House said.

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“An advantage we have going for us is literally anywhere in BC… you can’t afford to live there; GTA the same thing.”

CMHC echoed those expectations, citing “stronger migration patterns and economic conditions” in Alberta.

“People are relocating and purchasing or renting,” said Hartfield, citing the high cost of living in the Toronto and Vancouver metropolitan areas.

“I think that will be a long-term issue moving forward.”

The latest census data published in February showed the population of the city proper surpassed one million residents in 2021 with the metropolitan area’s population closer to 1.4 million.

The city’s own census, last updated in 2019, showed a growth trend where Edmonton’s population could reach the two million mark not long after 2040.

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Cost escalation

There are, however, obstacles to bolstering the city’s supply of multifamily units.

Inflation continues to drive up costs for developers and burdens the finances of prospective buyers or renters.

“This could get really out of control by September or October,” said Gupta.

Rising interest rates are another factor pushing some towards more affordable homes in multifamily properties, with variable rates expected to near four per cent by the end of 2022.

The ongoing COVID-19 pandemic also continues to affect building projects, with renewed lockdowns in China also threatening already-strained supply chains.

“Nothing is stabilized yet, we think we’re through COVID,” said Gupta.

“Until the supply chains in China sort themselves out, nothing matters.”

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