Supply chain issues, rising interest rates and more people moving to Alberta could contribute to a housing shortage in Edmonton, according to several industry leaders.
These trends, along with rising construction costs, were the focus of discussion at several roundtables at the Edmonton Real Estate Forum – a major industry conference held at the Edmonton Convention Center – on Wednesday.
“Everything is gearing up for there to be a housing shortage in Edmonton 12 months from now,” said Rohit Gupta, president of Rohit Group of Companies.
Following a multi-residential market roundtable, Gupta told CBC News that developers may not be able to build homes fast enough to meet growing demand.
Supply chain issues
Several commercial real estate industry leaders, taking part in a panel discussion on retail trends, said supply chain issues were keeping them up at night.
There are long lead times for mechanical items, including refrigeration, gas coolers and transformers — possibly due to pent-up demand during the COVID-19 pandemic, said Jarrett Thompson, director of operation at Cameron Corporation.
Delays lead to longer and more expensive commercial and residential projects, he added.
“Despite the existence of a market right now, many builders are pulling back, which creates major challenges,” he said.
Among the many challenges is the lack of nails, linked to the war in Ukraine, said Gupta, of Rohit Group of Companies.
“That’s all,” he said.
“At some point, we’re so numb with pain.”
Few executives predict that these problems will soon disappear.
Darren Quayle, vice president of Alberta customer services for Oberfeld Snowcap, expects supply chains to return to normal within 18 months to two years.
Statistics Canada data shows Alberta saw the most interprovincial migration in the last three months of 2021, marking the first time since 2015 that the province led the country in this measure.
Most of these people were from Ontario.
Gupta said most people moving from Ontario to Alberta have settled in Calgary, but Ontarians’ interest in the Edmonton market has accelerated.
The relative affordability of real estate in Alberta is a key factor in their decision to move, he said.
“We see people [from Ontario] buy houses without seeing them.”
During Wednesday’s multi-residential housing panel, Strachan Jarvis, managing partner of real estate investments for Toronto-based Hazelview Investments, pointed out that Canada welcomed a record number of immigrants last year, but the supply of housing had not caught up.
“We just don’t build enough,” he said.