Alberta Mortgage Payment Calculator 2024

The western Canadian province of Alberta is the fourth largest province in Canada, covering a total area of 661,848 square kilometers (source: Statistics Canada). As of July 1, 2022, the population of Alberta was over 4.5M, making it the fourth most populous province in the country (source: Alberta population estimates). It is estimated that the population of Alberta will reach 6.4M by the year 2046, an increase of almost 2M or 45% compared to 2021. According to the income-based GDP estimates of Statistics Canada, Alberta's GDP at market prices in 2021 was over $374B, almost 15% of Canada’s GDP. The median after-tax income in the province for the year 2020 was $77,700, the highest of all provinces in Canada and $10,900 above the national median (source: Statistics Canada).

Alberta’s housing market is a more affordable market compared to Ontario housing market and British Columbia housing market. In October 2022, the average house price in Alberta was $430,964. In comparison, the average house price in Ontario was $835,090 and that in B.C. was $932,979. The average house price in Calgary housing market peaked to $547,720 in February 2022, after which the prices fell because of Bank of Canada rate hikes and increasing mortgage rates. In November 2022, the average home price in Calgary reached $490,134, falling 10.5% compared to the peak. The following graph shows the variation in average home prices in the Calgary housing market from November 2021 to November 2022.

Calgary House Prices

The most expensive housing market in Alberta was the Calgary housing market with an average home price of $490,134, followed by Fort McMurray with an average home price of $369,455. The Edmonton housing market followed closely behind with an average price of $368,576. The average home price in Grand Prairie was $325,414, followed by Lethbridge and Red Deer with average prices of $332,969 and $332,885 respectively. Most of the average priced homes in Alberta qualify for CMHC mortgage insurance and require only up to 10% down payment when priced less than $1,000,000.

The average home prices for different home types in the major cities of Alberta in November 2022 were as follows:

Calgary

Edmonton

Red Deer

Accounting for closing costs before buying a house can prevent unexpected expenses later. Most fees and costs that are a part of closing costs are required to be paid upfront and cannot be included as a part of your mortgage. While land transfer taxes form a significant part of closing costs in most Canadian provinces, the Alberta government does not require buyers to pay a land transfer tax . However, land transfer registration fees and mortgage registration fees are required to be paid. The following costs and fees are a part of closing costs.

• Legal Fees
• Property Survey
• Land Transfer Registration Fees
• Mortgage Registration Fees
• Home Inspection
• Property Appraisal
• Title Insurance

While the closing cost in most Canadian provinces ranges between 2%-4% of the house price, the closing cost in Alberta will be less than 1% of the house price in most cases. The fees such as legal fees, property survey fees and home inspection fees are decided by the service providers and are subject to vary.

Land Transfer Registration Fees & Mortgage Registration Fees

As opposed to other provinces in Canada, the Alberta government does not charge a land transfer tax when a property is purchased in the province. However, a land transfer registration fee is payable to the Land Titles Office. The base rate for the same is $50, and an additional $2 is payable for every $5,000 of the home price. In addition to this, if you take a mortgage to buy the home, the mortgage needs to be registered as well. The base amount for the same is also $50, and an additional $1.5 is payable per every $5,000 of the mortgage amount.

For example, if you buy a house worth $500,000 and pay a downpayment of $100,000 while mortgaging the rest, the fees will be as follows:

Lawyer Requirements and Legal Fees in Alberta

In Alberta, it is necessary to hire a lawyer when you buy a property; however, the lawyer does not necessarily need to be a real estate lawyer. There is a lot of documentation involved in the process of buying a house, and a lawyer can help you with the review of agreement documents and with all the due diligence. Lawyers can conduct title searches to ensure there are no claims and restrictive covenants on the title that you are unaware of. A lawyer will safeguard your interests during a deal and protect you from potential frauds. Lawyers also create the statement of adjustments, deliver the final amount to the seller and facilitate closing. The average lawyer fees are $500 - $1,500 for a real estate deal, which may exclude disbursement fees for bank transfers, title search, writ search and other third-party expenses.

First-time homebuyers in Alberta can benefit from assistance programs offered by the province and cities. These programs are aimed at helping new buyers own homes and eventually build some equity.

Attainable Homes Calgary

Attainable Homes Calgary (AHC) is the City of Calgary’s non-profit social enterprise helping Calgarians own houses by providing down payment assistance. The individuals and families need to pay only $2,000 of the required 5% down payment, and they receive an interest free loan on the rest of the amount through the program. When the house is sold, the down payment loan needs to be repaid to the AHC along with a share of the appreciation. To qualify, a minimum household income of $45,000 is required. The income requires to be less than $84,000 for individuals, $94,000 for couples and $104,000 for households with dependents.

Edmonton First Place Program

The Edmonton First Place Program offers a five year deferral on the land cost portion of the mortgage for eligible properties, making these properties more accessible to first-time buyers. The properties that are eligible for this deferral are townhomes built on vacant school sites by select builders. These townhomes are registered as condos and the owners are required to pay the cost of the unit, condo fees, property taxes and utility bills. In 2006, 20 school sites were selected for the program, of which 14 were developed by March 2020.

Public Essential and Key (PEAK) Program (No Longer Available)

Introduced in 2009, the PEAK Housing Initiatives Program provides down payment assistance to middle-income families and individuals in Alberta. The value of the PEAK housing units are comparable with market value. The qualifying families and individuals receive a second mortgage for a partial or full down payment of up to 5% of the home value, which needs to be repaid only when the house is sold. This mortgage is interest free for the first five years, and the interest starts accruing after this time. Homeowners can choose to sell the house after five years, and the initial funds are recirculated to help new buyers. The buyers who live in the purchased house for at least three years can retain all of their home equity, minus the initial deposit.

To be able to qualify, buyers must have a household income less than $80,000 if there is no dependent child and less than $90,000 when there is a dependent child. The housing units inventory for this program is provided by Trico Homes and because of this inventory being sold out, the program is not available at the moment.

In Alberta, foreign nationals and foreign corporations are not allowed to own or beneficially own more than two parcels of private (controlled) land, with a total area of up to 20 acres. This restriction does not apply to Canadian citizens and permanent residents. Unlike B.C. and Ontario, foreign buyers are not required to pay any non-resident speculation taxes (NRST) on top of land transfer taxes. From January 1, 2023, all foreign buyers will be banned from buying real estate in Canada for two years.

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Even though the cost of living in Alberta is a bit lower than Ontario and British Columbia, it remains one of the most expensive Canadian provinces to live in. The most expensive city in Alberta is Calgary, where a family of three can expect to spend $4,700 every month on housing, food, transport and childcare. Even though the housing and gas prices in Alberta are moderate, the food and electricity costs are among the highest in Canada. Alberta has a sales tax rate of 5% (GST), much lower compared to 13% (HST) in Ontario, 12% (GST + PST) in British Columbia and 14.975% (GST + QST) in Quebec.

Like the rest of Canada, Albertans also had to deal with an elevated cost of living in 2022 due to increased inflation rates. In October 2022, the inflation rate in Alberta was 6.8% as per the Statistics Canada’s Consumer Price Index data, almost the same as the national inflation rate of 6.9%. The food prices increased by over 10% compared to last October, and the inflation rate for energy was almost 14%. The core inflation rate, excluding food and energy, was more than 6%. The gas prices inflated at a staggering rate of 18% in October 2022.

Based on the annual budget needs of municipalities, homeowners are charged annual property taxes to cover the expenses of municipal services such as public transit, police, garbage collections, fire department and schools. Properties are assessed by the municipalities every year and the tax is calculated based on the assessed value. Property tax rates include two main components –

• A municipal tax rate to cover city services and infrastructure
• An education tax rate to fund primary and secondary education

The property tax rates for some of the major municipalities in Alberta are listed below.