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Residential real estate: Alberta on an economic upswing

Albertans are feeling positive about the future. There are many things that fuel increases in residential real estate sales and one of them is a positive economic outlook. For many in Alberta, particularly in Cow Town, growth in many sectors is reason for celebration. Analysts say the next five years are looking bright for infrastructure in general and for the real estate industry, in particular. 

Although the economy is slow in recovering, it is expected to continue to be on the upswing through 2024. Much of that is due to the expected and continued increase of Alberta crude oil prices. Also, investment in residential builds is expected to outpace nonresidential in the next five years. The Calgary area is expected to generate nearly $9 million in investment within the next few years.

Real estate transactions: Legal cannabis affecting market

It's been more than half a year since the country legalized cannabis. Making cannabis legal has had a positive effect on real estate transactions in Canada -- both agriculturally and commercially. It has also had an effect on real estate prices in general, according to a recent study. Smaller communities are benefiting from the increased demand for agricultural lands.

Canada's top cannabis producers are veering away from urban centres where land sells at a premium. Industrial buildings that have sat vacant are being leased for fulfilling orders connected to the cannabis industry. The retail sector has also been a part of the chain reaction the cannabis industry has caused in the market. 

Real estate transactions: Edmonton rallies despite ongoing slump

The real estate sales slump continues in Wild Rose Country -- particularly in the capital area. Real estate transactions across Alberta, as in most of the rest of the country, have been slower than usual. However, the Canadian Mortgage and Housing Corporation (CMHC) has hope that people's disposable incomes will help the market slump and lessen the gap between the now buyer's market and seller's market.

In its recently quarterly report, CMHC indicted that the real estate industry is still in a delicate state around the country, especially in urban centres including Edmonton and Calgary. Edmonton, however, is faring better than most places and vulnerability there is mainly due to overbuilding in a still listless market. Demand in new housing isn't as lively as new builds have been and it has been tough on the capital city trying to recoup from the 2014 recession which affected real estate transactions.

Real estate transactions: SOP offers becoming rare in flat market

It seems conditional on sale of property (SOP) offers are becoming passé. More homeowners in Canada are waiting to sell their listed properties before making an offer on another. Much of this can be pinned on a slow-moving market across the country in which fewer real estate transactions are taking place. Sales across larger urban centres in Canada have continued to plummet -- down nearly 2% from last year.

The snail's pace market is keeping properties listed for longer amounts of time and making sellers more cautious about tying up other homes before theirs sell. Some vendors are still expecting their homes to sell over the asking price regardless of market conditions. In fact, some experts are saying vendors should be prepared to accept offers below asking price.

Real estate transactions: How they fit into a financial plan

For those looking to make solid investments, real estate may be a great option. If Alberta residents make wise real estate transactions, it could bode well for them regarding their long-term financial goals. Building wealth is important for the future, especially when families include children. Many solid financial plans include the procurement of real estate.

There are a few ways to make real estate work in a long-term financial plan. One of the most popular is buying a property that needs some TLC and then flipping it (selling it right away) once the work has been done. Of course, the seller hopes to make a profit on the property. If done the right way, this could be lucrative, but if not, buyers could stand to lose their shirts. Getting the help of a real estate professional is prudent before purchasing a handyman's special.

Real estate transactions: Commercial, industrial deals heat up

Commercial real estate investments are burning up the market in Cow Town. As far as real estate transactions go in Alberta, Calgary's commercial sector has been leading the pack, according to many analysts. The city has had the highest number of completed commercial deals in six years. The industrial sector is also outperforming past years. 

In fact, industry-related sales have topped their highest levels in a decade -- 132 transactions topping out at $758 million. That accounts for a 14 per cent increase in action over the same period in 2017. Most of those deals were inked by larger corporations like Manulife and Enright Capital. Currently, Calgary has more than 3 million square feet of industrial property being developed.

Real estate transactions: Prices continue downward correction

It looks as though house prices in Canada could drop even further according to the International Money Fund (IMF). Real estate transactions in Canada -- especially in larger, urban centres -- have been thwarted by a number of things such as a volatile economy and the country's mortgage stress test -- making it more difficult for players to get into the game. Calgary is among those major cities poised for an even further correction in market pricing. 

A correction market pricing could open up the playing field for many prospective first-time buyers, especially since the federal government included incentives for first-time buyers in its recent federal budget. Homes stateside saw this type of correction a few years ago, whereas prices escalated in Canada. It seems that the tables have turned and real estate in Canada is now on a more even keel. 

Residential real estate may heat up according to commercial sales

The positive way the commercial real estate sector has been performing in Cow Town may mean single family homes aren't far behind. Residential real estate sales in Alberta have been cool at best lately, but commercial sales in Calgary have been steadily on the rise, which make some analysts believe residential sales might start to do the same. These deals, analysts add, show faith in the economy, so it may be likely homeowners will take heart. 

In the last quarter of 2018, commercial sales in Calgary amounted to $1.4 billion showing an 8 per cent growth over the same time in 2017. Most of the $3.7 billion in commercial deals in Calgary in 2018 were inked in the last quarter. Developers and investors say they are cautiously optimistic. And when potential buyers and sellers of residential real estate see commercial investors heating up the market, it may give them some hope the residential sector will continue to improve.

Real estate transactions: PHI Hotel Group expands holdings

PHI Hotel Group has recently expanded its portfolio. The company has increased its holdings by snatching up properties in Alberta since it says it believes in what the province has to offer. PHI's latest real estate transactions in the Wild Rose province include the opening of new hotels in Edmonton West, bringing its total to 12 in the province overall with plans to expand its footprint further.

The company president said the company has exceeded its underwriting goals when it comes to business in Alberta. PHI owns 24 properties in both Alberta and B.C. He said PHI opens hotels in areas where there aren't many, citing Edmonton West as an example. As such, these properties absorb a bigger market share than older, more established ones.

Real estate transactions: Home prices continue to drop in Canada

Property prices are continuing to decline. In fact, they're dropping so much in Canada that February's real estate transactions set a record for the heftiest decline in years in a non-recessionary time. The price index used by the National Bank of Canada indicated that prices fell by 0.4 per cent in February over the same time in 2018.

Analysts say it isn't the greatest start to the year, especially since these numbers are the lowest since this particular index has been utilized (apart from a listing in 2009). Most of the volatility is centred around larger urban centres in Canada's most populated provinces, but the fallout is being felt in all areas of the country. The Teranet House Price Index (Teranet HPI) used by the Bank of Canada, gets its information from land registry data on sales that have closed. 

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