Edmonton Median Household Income and Prices

I recently received a comment from a Dallas Fort Worth area REALTOR® Karen Anne. She was commenting on the fact that Edmonton's sale price per square foot is close to double the Dallas/Fort Worth average sale price per square foot. I found this fact amazing. We are both major cities in oil producing regions with abundant land to be developed in the area that surrounds the city. This is in contrast to a Canadian market like Vancouver, where they are surrounded by both the ocean and mountains and therefore have a lack of land to develop. As a result, land and housing prices can be inflated easily by the lack of supply.

I've read an excellent paper by the Demographia International Study http://www.demographia.com/dhi.pdf by Joel Kotkin. They classified Edmonton as a moderately unaffordable city because we had a 3.5 ratio of incomes to house prices. This ratio is created by dividing the median housing price by the median household income. This study was created in the 3rd quarter of 2010, and our prices in Edmonton have dropped since that time. 

In 2011, our median household income in Edmonton is approaching $100,000, and the Median residential price in Edmonton in the last 30 days (as of March 15, 2011) was $305,000. That is closer to a 3.0 ratio which according to the Demographia study is classified as an affordable market. Other markets in Canada have high ratios, for example Toronto is 5.1, Montreal is at 5.2 and Vancouver is sitting at a whopping 9.5! I love Vancouver but I'm not sure if I could ever justify the cost of living in that city!

Getting back to the inspiration for this post, Houston is at 2.9 and Dallas is at 2.7. So, once you look at incomes, Edmonton is very close to the Texas averages after all. This is also a fact that is contrary to the theory that Edmonton's real estate pricing is in bubble territory.