Starter Homes in Alberta

In Alberta, there are two major cities that people live, work and play in: Calgary and Edmonton. And the good news for most first-time homebuyers is that purchasing a home in both cities is considerably more affordable than some of the other big markets.

According to Edmonton-area mortgage broker Nelson Sousa, starter homes can be found in almost all areas of the city.

“As the city expands, new development areas continue to grow North, South, East and West,” Sousa said.

With the average starter home priced in the $250,000 to $300,000 range, first-time buyers are able to get into the market early, and in a townhouse or single-family dwelling, no less.

In Calgary, on the other hand, the average starter home costs between $300,000 and $350,000. Realtor Jim Sparrow knows less expensive homes (under $300,000) are available in nearby towns – like Airdrie to the North and Okotoks to the South – but suggests the costs involved with living outside of the city should be considered by first-time buyers, before making any final offers.

For instance, property taxes are often higher on bigger homes in smaller communities than on smaller homes found in Calgary.

“The other [downside] of living [in one of these communities] is the travel expense,” explained Sparrow. “You might think you can live with it for a year or two, but it does add up. And you’re looking at significant commuting time.”

Many homeowners living in these satellite communities drive to Calgary for work, or to the nearest CTrain station and commute that way. On a summer day, Sparrow estimates the drive from Okotoks into downtown Calgary takes about an hour.

“You’ll save about 10 to 15 per cent on the cost [of the home],” said Sparrow, “but you’ll chew that up in a couple of years, with the time and gas spent driving in and out of Calgary.”

In both Edmonton and Calgary, homes can be found in the inner city as well as in the city’s suburbs, which seem to be always expanding outwards.

“We haven’t grown up,” said Sparrow, “we have probably close to a million [people living in] the city now, but we don’t have a huge number of condo towers like in Vancouver or Toronto.”

For first-time buyers who cannot afford to live in the core of Calgary, single-family homes and townhouses in newer communities like Nolan Hill, Skyview Ranch and Walden may be where they get into the market, suggested Calgary realtor Mike Hornby.

“The prices are more affordable, due to the lack of infrastructure in the area,” Hornby explained.

While being further away from schools, recreation centres, etc. might be ok for some people, there are still a number of older areas that offer starter home options for first-time buyers, which are both affordable and offer a better infrastructure. In the end, it all comes down to what the buyers’ priorities are.

“First-time buyers are looking for value, not unlike any other buyer,” said Hornby.

While newer communities offer modern kitchens with granite countertops and stainless steel appliances, older areas come with fenced yards and some detached garages, as well as better access to transit.

To give you a better idea of what you might be able to afford in Edmonton, Calgary and surrounding areas, we’ve created a chart using actual homes available for sale.

It’s not difficult to see that the home in Edmonton is cheaper per square footage. But in the Calgary vs. Okotoks examples, while the purchase price is cheaper in Okotoks, this buyer would pay more per square foot and would also need to commute if “work” was in the city.

As Hornby points out, first-time buyers need to be aware of all of their options. After deciding on the structural requirements of their first home, it’s often easier to then consider neighbourhoods, and start looking at MLS inventory last.

“This makes the process enjoyable and removes the stress buyers often feel when deciding on what home to buy.”