How Calgary’s Popularity Is Creating Higher Returns in Edmonton
Calgary has enjoyed an incredible run over the last two years. According to the CMHC and Canadian Real Estate Association’s latest data, Calgary has enjoyed almost a 7% increase in home prices and sales volume in the 12 months to May 2013, while prices and transactions fell on a national level. This is making it incredibly difficult for home buyers to find something they can afford or something they want to live in.
Last month’s statistics also show that apartment vacancies have fallen to just 1.2% meaning that there is virtually nothing to rent for the masses coming to Alberta in search of jobs or to set up businesses. This will almost certainly limit the amount of growth that Calgary will realize going forward.
Additionally to this, millions of square feet of new office space is about to hit the market in Calgary. While no one expects a sharp drop in demand for residential or commercial property here, this could certainly slow the speed of rent and property value growth. This is all a part of the reasoning behind the recent Conference Board of Canada report, which predicts positive things for Calgary in the short term, but a negative outlook in the long term.
In contrast Edmonton has a lot more to offer the hordes of workers and business owners migrating to Alberta.
There are more choices of residences and more housing for the money. For investors it means a lot more room for growth, a lot more velocity and security, and better total returns over the next five years.
Edmonton too enjoys low vacancy rates on multifamily and business property, low unemployment and it’s quickly becoming a much trendier place to live in. New development is in the works, and the city has been dubbed as one of the top two investment locations for 2013 and beyond by numerous analysts.
The recent sale of a luxury condo in Edmonton goes for almost $1 million over its assessed value, which shows how in demand property here is becoming. The construction of the Pearl Tower signals a built up trend that will mean more revenues for local government and more room for new residents while maintaining a vibrant downtown, and a far cooler skyline which will only increase the city’s appeal.