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30-03-2007, 07:41 AM
Home price explosion hits capital
Edmonton's real-estate jump doubles rise felt in Calgary

Fri, March 30, 2007

Edmonton's rapidly shedding its role as a real estate bridesmaid to Calgary with an increase in house prices double the Stampede City's over the last year.

Alberta is once again the main engine of home-cost growth in Canada, reports Royal LePage Real Estate Services, but Edmonton is now the city firing on all cylinders with a 54.4% increase from the first quarter of 2006 to the same period this year.

By contrast, Calgary prices rose 27.4% -- still well above the national average of 11%, stated the report, noted Richard Corriveau, senior adviser for the Canada Mortgage and Housing Corp. (CMHC).

"It's a function of record demand with supply in Edmonton similar to the conditions that existed in Calgary a year ago," he said.

Still, the cost of an average house in Calgary in February was greater than in Edmonton at $393,000 to $321,000 respectively, said Corriveau.

"We're not comparing apples to apples here -- Calgarians have typically higher-than-average incomes and will purchase different product than in Edmonton," he said.

While Calgary catches its breath after a scintillating home market year in 2006, Edmonton is making up for lost time and has more room to boost prices, said Jon Hall, spokesman for the Edmonton Real Estate Board (EREB).

"We've been saying for years our housing is under-priced," said Hall.

The surge is a surprise, with EREB predictions of a 6% hike in housing prices for 2006 easily eclipsed.