Alberta’s Rising Wages to Keep up Real Estate Returns
According to the latest data released by Statistics Canada Alberta continues to boast the highest average weekly earnings in the country. Year over year gains as of April 2013 reflects an average of a 3.4% increase, with some sectors seeing a 3.7% rise and average weekly earnings as high as $1,291.
Perhaps the most significant impact this will have beyond sucking in more talented workers like a galactic tractor beam, is keeping housing in the province affordable. This will definitely also help melt concerns over the potential for rising interest rates for both regular home buyers and those investing in commercial real estate in AB.
This will allow home prices and sales volume to keep rising, while fueling the wider real estate employment sector and construction industry. Even though Alberta may be largely energy driven, this will play a major role in strengthening and growing the local economy.
In turn this adds to a significant lift to consumer confidence, pushing up consumer spending. As consumer spending in the region continues to blossom, following already being some of the top producing floor space in the world, demand for retail space should only keeping increasing as well.
More retail wars, need for expansion and battles for getting in front of road and foot traffic will allow rents to be raised, while pushing up the property value of local shopping plazas.
Of course the inevitable fall out from this improved yields and total returns, of which Edmonton already owns the title to some of the best on the world map.
For many Canadians and analysts this finally puts broader fears to rest. There may be little to stop the slide in ON and BC, but here in Alberta we are seeing the direct opposite trends of what happened in the U.S. meltdown. In the USA there were massive job losses and income losses in tandem with declining property values and rising interest rates. No one expects to see that in Alberta for quite a number of years.