Housing prices in Alberta's largest cities skyrocketed in 2006, with an average residential property jumping 49 per cent in Edmonton and 38 per cent in Calgary over the year.
Figures released by Edmonton's real estate board this weekshowed the averageprice ofa single-family home was $341,933. In Calgary, the average for the same dwelling was $396,870.
It was an "astonishing year in real estate," said the Edmonton Real Estate Board.
"This was a very challenging year for both buyers and sellers," said Madeline Sarafinchan, outgoing president.
"Buyers had to rush their decisions of which house to buy from a very limited inventory. And sellers were snowed under with multiple offers and had to manage demands from prospective buyers."
Despite the unprecedented prices, sales have been brisk in Alberta's capital, she said.
Many of Edmonton's outlying communities are also seeing the same kind of sharp rises in their housing prices. The only community with housing in the $170,000 range is Vegreville, an hour commute from Edmonton.
Calgary board predicts strong 2007
Ron Esch,executive vice-president of theCalgary Real Estate Board, predicts another strong year in residential house prices,and thatthe average price of a home in Calgary will hit $500,000 in less than two years.
"All one has to do is look back over the last30 years to see where house prices come from, and if you use a calculator and extrapolate the percentage increases over those years, I think by the year 2025 the average home may be about a million dollars."
Eschsaid even though real estate board members are pleased with the strong housing market, they are concerned about affordability for first-time buyers.
Land titles office 23 days behind
Meanwhile, Alberta's booming real estate market is creating a major backlog at the provincial Land Title's office, whichis 23 days behind in processing mortgages and land transfers.
Eoin Kenny, spokesman for Service Alberta, said the office has hired more staff and is working six days a week, but they just can't keep up with demand.
"Back in 2000, the Land Titles office handled 868,000 transactions. Last year, it was 1.3 million. We're literally victims of our own success. Because interest rates are low, because wages are high, people are buying more property."
Kenny says many people are buying title insurance while their paperwork is being processed by his office.