The Mayan apocalypse never happened, the U.S. avoided plummeting from a fiscal cliff, and Alberta real estate market conditions have rebounded to a point almost on par with pre-market-crash figures from 2007. Which brings up the question: Is the time ripe to invest in property in this province?
In a word, according to most market pundits, absolutely!
A recent report issued by the Real Estate Investment Network has cited that with the country finally recovering from the doldrums of the bear market, the time to take advantage of opportunities surrounding properties is now, and Wild Rose Country is the most promising territory to realize the best returns on such investments.
In its annual list of top 15 Canadian real estate investment markets, five of them are in Alberta, with the top two prospects being Calgary and Edmonton, sitting at first and second respectively. Airdrie placed sixth, Red Deer ranked eighth, and St. Albert landed in ninth place.
A rise in gross domestic product, dropping unemployment figures and a robust energy-based economy have been the biggest indicator signaling a green-light for real estate investment, particularly in Calgary.
“When you combine the economic fundamentals, the population growth, and a burgeoning provincial economy, it is easy to see why so many businesses and people have come to call the city home,” stated the REIN report, Top Alberta Investment Towns, issued late in 2012.
The timing for a provincial investment comeback is also striking when the rest of the country is bracing for market corrections in the real estate market, particular in Toronto and Vancouver, where housing costs can be up to a quarter-million dollars higher for a similar sized home in Calgary or even Edmonton.
It’s not merely more comparable cost of living that’s attractive. Gross Domestic Product figures of 3.4 per cent in Calgary and 3.0 per cent in Edmonton ─ the highest in the country ─ has created job growth and immigration to the Alberta cities, which in turn leads to greater housing demand. In Calgary, rental properties have skyrocketed, creating incentives for Calgarians to purchase homes instead. And with the economy in Alberta predicted to steadily sail unhampered through to 2019, such purchases spell greater returns on investment for the rest of the decade.
While Calgary’s fortunes rest largely on the energy sector, Edmonton enjoys a No. 2 ranking largely due to a more diverse economy and promises of a ring road system and better public transit to make the city more accessible to outlying neighbourhoods. Meanwhile, lower housing prices than what’s evident in Alberta’s two largest cities, combined with the spillover effects of their proximity to the fruitful Calgary-Edmonton economic corridor, make property in Airdrie, Red Deer and St. Albert attractive as well.
However, the fact that Calgary sales prices cited last December jumped by 6.9 per cent to $419,811 (an increase almost five times the national average), is prompting investor proponents to jump on the opportunities as soon as possible while properties are still relatively affordable.
The bottom line for investing in Alberta real estate? Said the report, “The market is hot.”