Alberta Real Estate Holding Its Own

by Joe Samson

The annual winter lull in the real estate market means that the time is good for prospective buyers who like to take their time. With Canadian unemployment at a 33 year low, the real estate market looks like holding strong despite the U.S. housing crisis.

It is difficult for many of us Canadians to accept that while the U.S. real estate market may be floundering, the Canadian market is steady. In fact, due to the strength of our dollar and the weakness of the U.S. dollar against International currencies, many Americans are actually buying into Canada to preserve their funds, hence further driving up prices by increasing the demand for houses.

While coastal and lake areas would seem an obvious choice for American speculation, many are buying properties simply as an investment project to hedge against their dropping currency. Renting a condo is one of the easiest ways to make money and have the property 'buy itself', and condo sales everywhere have jumped as people are realizing the enjoyment of life without maintenance!

Calgary condos are an attractive investment and they offer a reasonable price range if you are trying to get started on the property ladder. The increased inventory of all properties has slowed the market at the moment, so now is a good time to look for a condo. Some builders have even dropped their prices, so brand new ones can be snapped up by the shrewd buyer.

Despite the changes emanating from the famous revisions to the oil royalty revenue, Calgary has a strong economy and has seen a large population increase. According to one national forecast, it is poised to experience moderate growth and a sustainable real estate market though 2008.

Average house prices in Calgary are set to increase by 5% and in a slower moving market, first time buyers may be encouraged to put their toe in the water.

Falling interest rates are also on the horizon as financial market confidence had been severely undermined by the prospects of a U.S. recession and the possibility of some contagion to the global economy. Speculation out there is that the Bank of Canada is going to further cut their interest rate by 75 basis points before the end of spring.

 

According to a report released by TD Bank Financial Group, another monetary upside for us Canadians is that unlike our American neighbors, we are not losing money on both ends of our portfolios (real estate & stock market). House prices will remain in a positive swing during 2008 and there is little concern that the housing market will mirror the slump in the U.S. In fact, Calgary’s real estate is projected to increase 5% in 2008 compared to the losses in the U. S. of 5% or even more in some regions.

Things often 'heat up' in the housing market in the spring, so now may be a good time to invest in Calgary’s real estate.