Edmonton could be headed toward housing supply shortage, real estate industry leaders warn
Developers are grappling with supply chain delays, rising construction costs
Supply chain problems, rising interest rates and more people moving to Alberta could contribute to a housing supply shortage in Edmonton, according to multiple industry leaders.
These trends, plus the rising cost of construction, were front and centre during multiple panel discussions at the Edmonton Real Estate Forum — a large industry conference held at the Edmonton Convention Centre — on Wednesday.
"All things are lining up for there to be a housing shortage in Edmonton in 12 months," said Rohit Gupta, president of Rohit Group of Companies.
Following a panel discussion on the multi-residential market, Gupta told CBC News that real estate developers may not be able to build houses fast enough to meet rising demand.
Supply chain snags
Multiple commercial real estate industry leaders, participating in a panel discussion on retail trends, said supply chain problems keep them up at night.
There are long lead times on mechanical items, including refrigeration, gas coolers and transformers — perhaps because of pent-up demand during the COVID-19 pandemic, said Jarrett Thompson, chief operating officer at Cameron Corporation.
The delays are resulting in more time-consuming and expensive commercial and residential projects, he added.
"Despite there being a market right now, a lot of the builders are pulling back, which is creating some major challenges," he said.
Among the many challenges is a lack of nails, linked to the war in Ukraine, said Gupta, of Rohit Group of Companies.
"It's everything," he said.
"At some point, we're so numb to the pain."
Few executives predict these problems will disappear any time soon.
Darren Quayle, vice president of Alberta client services for Oberfeld Snowcap, expects supply chains to get back to normal in 18 months to two years.
Statistics Canada data shows Alberta saw the most interprovincial migration during the last three months of 2021, marking the first time since 2015 that the province led the country in that metric.
Most of those people came from Ontario.
Gupta said most of the people moving from Ontario to Alberta have settled in Calgary, but Ontarians' interest in the Edmonton market has been accelerating.
The relative affordability of real estate in Alberta is a key part of their decisions to move, he said.
"We're seeing people [from Ontario] buying houses sight-unseen."
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 housing supply has not caught up.
"We simply are not building enough," he said.