What to Do With $250k in Edmonton
How can you invest $250,000 in Edmonton, Alberta?
There are increasingly more ways to burn money in Edmonton, Canada every day. Between new stores, new housing developments, activities and the arena going up, along with an increasing number of major international retailers and luxury brands, you don’t have to go far to drop a few thousand, or few hundred thousand dollars, if it’s burning a hole in your pocket.
The Calgary Herald recently ran a feature article comparing the benefits of buying a home in Alberta versus a Lamborghini Gallardo. Both cost around $250,000. So which of these is money well spent, or is there a better way to relieve yourself of the burden of all that extra cash?
Even though Albertans and Canadians in general love their shopping, have some of the highest levels of earnings, disposable income and retail earnings per square foot in the world, most would still think it wiser to invest this type of money than waste it on consumer items they’ll never use again.
The 2014 Lamborghini Gallardo could easily be considered an ‘investment’ for some, especially serious car collectors with extra cash. According to the spec sheet, the sports car produces less CO2 emissions per year (depending on how much you drive it), offers heat and mirrors, and can go from 0-60 in just 3.9 seconds.
Of course the Lamborghini doesn’t offer much room for entertaining, and won’t get you very far in the snow. According to the Herald journalist, the car depreciates at a rate of a little over 21% every 5 years, versus a home which might gain more than that in value during the same time frame. That’s pretty modest since the general consensus has been losing an instant 50% in value the moment you drive off the lot. Note, that those with a serious need for speed could scoop up the BMW M3 which actually accelerates even faster than the Gallardo for a small fraction of the price.
For those that don’t own a home in Edmonton, it could be a great investment. Local home values are expected to continue to rise for some time, even if interest rates to go up. However, with building permits hitting new highs (even outpacing Calgary) and condo developments surging around the new arena renting may not be a bad move either.
Canadian real estate is a solid investment. It really shouldn’t be much of a choice at all actually. You can either toss $125,000 away in 3.9 seconds which will never be seen again, or you could invest in real estate and see that original $250,000 grow and multiply, allowing you to splurge on the luxury consumer goods at a later date.