With the advent of legal marijuana on the horizon, a few Albertans are thinking about cannabis-friendly buildings. It will make some real estate transactions interesting. Canada is set to legalize pot this summer, and some building owners who already use marijuana are thinking about allowing their tenants to smoke weed in their buildings -- and going a step further and actually seeking tenants who are cannabis users.
Investors are starting to feel good again about putting their money into housing construction in Wild Rose Country. Year-over-year spending in the house construction sector of real estate transactions in Alberta rose for the first time last year since 2015. Even though the numbers are rising, they're not quite where they should be -- slightly better than 2015's recessionary levels -- according to a market analyst. Still, the market is rallying and that is good news for investors.
Investing in property can be a very wise move financially. But when getting involved in these kinds of real estate transactions in Canada, a potential investor would do well to do some research before diving in head first. For a first time foray into the world of real estate investing, going small at first might be prudent.
Many land title searches are done of on the internet these days. So, when real estate transactions in Alberta were shaken up by problems with the province's land titles site that results in it being off line for days, it made for some very disgruntled purchasers. Many of those people have lost hundreds of dollars because of the glitch on the site that is used to finalize real estate deals.
The word shadow has a dark connotation, but it isn't necessarily a negative when it comes to mortgage lending. Real estate transactions are becoming increasingly more complex in the 21st century and it's getting more difficult for some people in Canada to purchase a home. So, doing business with shadow lenders, or those lending money that are not tied to a conventional financial institution, is on the rise.
The Canada Mortgage and Housing Corporation (CMHC) is looking for more information on home loans from shadow lenders or private mortgage lenders. Many purchasers in Canada are resorting to unconventional means to secure mortgages in their real estate transactions. The increased use of these types of lenders hasn't been consistently tracked and CMHC is concerned these loans could cause financial vulnerability.
New mortgage rules across the country may may it harder for purchasers to snag their dream homes. In Alberta, as in the rest of Canada, new rules regarding mortgages are expected to reduce buying power by about 21 percent. Real estate transactions may take a hit because of the move.
Things are looking rosy on the real estate front in Wild Rose Country. Alberta's capital city has seen an increase in real estate transactions in the industrial, commercial and investment (ICI) sector along with increased sales in the office, multi-residential, retail and industrial areas. In fact, sales from these sectors totalled more than $1 billion from January to June this year. That figure is up from just over $712 million during the same period in 2016.
Alberta has had some recent economic troubles, especially with the dip in the oil market. But if the community of Cochrane is any indication, things are looking up in Alberta all around, especially in regard to real estate transactions. With little hoopla, Cochrane has seen its population increase by almost 50 per cent over the last six years with a 4.5 per cent growth in 2016 alone with no signs of slowing down.
When jobs are scarce, it stands to reason that the housing market will take a beating. The slump in jobs in the Alberta oil sector may be harming a possible renewal in real estate transactions in the northern part of the province. Unemployed people have trouble making ends meet. Stagnant cash flow equals a thwarted real estate market.