Northern nirvana

Almost three thousand houses changed hands in the city last month. Like almost everywhere else, sales were down (less than 10%) from this time last year, and inventory was up (12%) from the early summer of 2024.

But unlike other places, citizens could actually afford homes.

The total residential average price in June was $464,177. That’s up 5% in a year. The detached average was $579,704 ahead 6%. That’s $1.42 million less than the benchmark in Vancouver. A 71% discount. Compared to Toronto, the saving is $1.14 million, or 66%.

And where is this magical city of 1.6 million people?

Three hours north of Calgary, called Edmonton.

And why is housing cheaper here?

Land is far less expensive. Population growth is modest. Even stable. It’s off the radar (largely) for both large-scale domestic investment and international money. And you need fluffy underwear plus a remote starter (for your car, silly) in February.

By the way, the typical condo in Toronto is about $800,000 (new = $1 million) while in Edmonton last month units sold for an average of $217,792. Oh, and there’s no sales tax in Alberta. But the premier is weirdly dangerous. Finally, there is a decent match between supply and demand in Deadmonton (as they call it in the evil East), which means normal people can actually afford real houses.

Check this out:

Source: Scott Ingram

The above graph charts the SNLR (supply to new listings ratio) which is an indicator of market strength or weakness. The further down the graph, the more desperate sellers are as buyers are few and far between. That’s Toronto and Vancouver, where residential real estate prices eliminate any family not gifted huge sums or earning $300,000 a year.

So check out Edmonton, Calgary, Ottawa and Montreal. Healthy, stronger, cheaper.

This pattern is likely to last all summer. Maybe all year. Or forever? After all, things are stacking up badly for the GTA and Lower Mainland. Population growth. Rising property taxation. A crisis in construction. And serious unaffordability that will not be alleviated by interest rate cuts.

The latest inflation news confirms that.

Headline CPI did not change from last month – still at 1.7%. And while that sounds peachy, core inflation at 3% does not, and is basically unchanged month/month. Groceries, rent, insurance, kibble – all still swelling in price.

“The latest inflation results are broadly similar to April’s outing—a deceptively calm headline number with core hovering too far above the 2% target for comfort,” says BMO Economics. “The BoC will likely need to see much more improvement before it’s convinced that underlying inflation is headed back to 2%…. the odds of a July cut are lower now.”

Hmmmm. So mortgages stay in the 4% range, a hardship for new buyers and also a million households who this year face renewing their cheapo Covid loans (as low as 1.5%). Six months ago everybody was forecasting at least two rate cuts by this time in 2025, but it looks like our CB will be holding the line once again in late July.

In fact, no rate relief could be coming until September. And perhaps not even then – depending on whether we get whacked by US tariffs or Big Daddy Carney makes a trade deal for us.

Meanwhile, don’t look south for any comfort in terms of Fed policy. Same thing there – where inflation stays stubbornly higher than in Canada. Chair Jerome Powell said this week he’s cool with doing nothing, sitting on his hands and waiting to see if the orange’s guy’s tariffs will goose inflation. (Trump is screaming at him to chop rates an incredible 2.5%. Powell laughs.)

“For the time being, we are well positioned to wait to learn more about the likely course of the economy before considering any adjustments to our policy stance,” the Fed boss told lawmakers today. So, no change expected there until the leaves start turning.

Conclusion: more misery in the steamy, teeming southern cities that think they matter. And a more affordable life where the cowboys roam. Go. Of course, you’ll need an F-150. With nuts.

About the picture: “In response to your plea for more dog pictures I offer this one of Ziggy,” writes Lloyd. “Here she is fresh from her ‘Walk For the Cure’ in Victoria – a fundraiser for ALS. It mystifies me how you continue to churn out entertaining and informative pieces virtually daily. Thank you for your work – you have accounted for many benefited lives. That must be quite gratifying.”

To be in touch or send a picture of you beast, email to ‘garth@garth.ca’.

Source: https://www.greaterfool.ca/2025/06/24/northern-nirvana/