Alberta Cities Come in 1st and 2nd for Best Places to Invest in Canadian Real Estate PLUS Edmonton Real Estate Forecast 2009 and 2010 Outlook

According to an article in the Canadian Real Estate Magazine, Edmonton takes first place in the best areas to invest in real estate in Canada. Whether oil is $50 or $100, Edmonton’s underlying economy is poised to be a national leader over the next decade. Calgary followed closely behind. Second in corporate head office locations in the country, lowest in unemployment and highest in average income, Calgary will challenge Edmonton as leader of Canada’s economy. Five Year Cycle: In Canadian real estate investing, you’ve got to be able to hold onto a property. It’s not like buying a stock that you sell a few days later because it went up a few dollars. I use a five year cycle, because that seems to be the time frame when you can trade up or move on. According to the Canadian Real Estate Magazine, the outlook for Alberta real estate is promising: The economy will grow by just 1.2% in 2008, as output has declined in goods-producing industries such as manufacturing, construction and mineral fuels. With these industries expected to rebound, Alberta is forecast to generate real GDP growth of 2.6% in 2009.

Edmonton Real Estate Forecast 2009

According to the Canadian Real Estate Magazine, Edmonton Real Estate forecasts for 2009 are very promising. A growth rate of 4%, according to the Conference Board of Canada, in part due to oilsands development in the northeast parts of Edmonton, construction and infrastructure activity, is making forecasts for Edmonton real estate 2009 a key player for property rental returns. According to Don R. Campbell, president of REIN, Calgary, “With over $200 billion of investment pouring into Northern Alberta in the next vie years we will witness a dramatic growth in jobs, which will attract people from across the country and around the world, each and every one of them requiring housing either rental or purchase in Edmonton real estate 2009.” In addition, the completion of the LRT route from Health Sciences Station to Century Park central Edmonton real estate at the end of 2009 is expected to bump up the 2009 forecasts for Edmonton real estate values by ten to even twenty per cent says REIN. In 2008, the average price of an Edmonton condo was $228,750 according to Royal LePage, which is one the most affordable and undervalued real estate markets in all of Canada. CMHC figures show the average monthly rental income for a two bedroom Edmonton property was sitting at about $1,000 per month. 2009 Edmonton real estate investors forecast such as Bill Briggs, a local realtor for Re/Max Real Estate Central Branch says that property investors in Edmonton tend to purchase mid to lower priced single family homes as well as apartments and condos to achieve good cashflow. The forecast for 2009 in Edmonton real estate values is that cashflow will continue to be a great positive for the markets while property values should stabilize by mid year. “Proximity to the University of Alberta, the Northern Alberta Institute of Technology and Grant MacEwan College provide a huge number of prospective home renters,” he says. Edmonton condo forecast for 2009 might be the best opportunity for cash flow because these units tend to rent faster and are expected to see a 12.2% increase in rent by the end of 2009, according to CMHC.

The 2010 Outlook for Edmonton Real Estate

According to many experts, now is a great time to purchase Edmonton property. There are several factors that result in this conclusion. Firstly, mortgage rates and lending are at all time lows in the history of this country. With BoC lending rate at 1% as of February 2009 and an expected drop by 0.25% to 0.5% in the upcoming Bank of Canada announcements, the variable rate mortgages that are tied to the BoC lending rate to some point, will possibly hit the lowest point ever in the coming month. The 2010 outlook for Edmonton real estate is that the rebound in commodity prices such as oil and gas will have a very positive effect on the Alberta economy in general, with Edmonton property prices in 2010 outlook and forecasting expecting a high single digit gain through the year. Variable rate mortgages are very low right now, and waiting even 6 months may mean a difference in one or two per cent over a course of a five year term. Any drop in Edmonton real estate prices in 2009 or 2010 will be offset by the increase in mortgage interest rates, so there would be no real advantage to wait if you, as a homebuyer, are ready to make a new Edmonton home purchase. Secondly, the Edmonton real estate outlook 2010 and beyond is that with many home buyers waiting it out to see where the market goes this year, and with forecasts for 2009 and 2010 in Edmonton real estate calling for a big dip in sales volume and a small decrease in sales price, there will be many more people looking to buy a home in Edmonton property market in 2010. with an increase in homebuyers, comes competition again, meaning that the new Edmonton home of your dreams may have multiple offers and possibly bidding wars for lower priced houses and condos. Why go through the tense wait of bidding wars when you can submit a single offer in 2009 Edmonton real estate outlook and forecast and end up with a great home that you love. Thirdly, oil and gas make up a big part of the Edmonton economy and is a driving force for the province of Alberta in terms of revenue, infrastructure, business and population growth. As commodity prices are at their all-time lows in the past 20 years and with the rise and growth of both China and India coupled with the insecurity of other gas and oil producing nations, Edmonton real estate forecast for 2010 and 2009 is much better than what most headline news portrays. With a growing demand in these developing nations, it is important for Edmonton to make sure that it gains the respectable relationships with these nations and to promote other clean energy sources for the future of Alberta. With a rebound of oil and gas prices expected in late 2009 and through 2010, the Edmonton real estate outlook and forecast is very good as property prices here have always had a direct relationship to commodities. With more people moving into the Edmonton area in 2010 and with an increase in the number of jobs coupled with a stagnant home building industry for the last two years, there will be a shortage of rental and owner occupied housing in Edmonton real estate in 2010 again. For all of these reasons, Edmonton real estate outlook 2010 and beyond is for a strong and stable market for both buyers and sellers.

Global Economic Crunch Will Temporarily Slow Down the Alberta Oilsands Boom – What Does This Mean To You?

Alberta Oilsands in Trouble?

There have been recent reports that many Alberta oilsands projects will be either delayed or cancelled this year. From the Calgary Herald to the Edmonton Sun and from the Financial Post to the Globe and Mail, the latter part of 2008 and for the most part the beginning of 2009 has brought about negative publicity and news regarding the growth (or lack there) of the Oilsands projects in Alberta. Obviously, the slowdown in the development of the Alberta oilsands will impact significantly employment in the northern part of Alberta, namely Fort McMurray, but also will have residual impact on the economy in the bustling engines of Edmonton and Calgary. The trickle down effect will be a stabilization of jobs and maybe an slight increase in unemployment which will make a dent into the Edmonton real estate market as well as the once fire hot Calgary property markets. According to the Canadian Association of Petroleum Producers, also known as CAPP, the Alberta oilsands northeast of Edmonton will likely reduce the barrels of production until the economic gloom and doom has ended. CAPP also expects that the spending in the Edmonton and Calgary oilsands projects in Alberta will be cut significantly by about twenty five per cent over 2009 from a projected estimate of $20 billion to $16 billion. Other projcts such as the East Coast Offshore projects in the Alberta oilsands indicate some troubling times ahead as well, cutting spending from $50 billion in 2008 down to $43 billion in 2009. Leading Alberta oilsands exploration, gas and oil companies have also slashed budgets and spending during the 2009 fiscal year during these times of economic uncertainty. Petro-Canada, Nexen, Canadian Natural Resources as well as Suncor and EnCana Corp have already announced budget slashes as the oil prices per barrel have landed between the low $30 to mid $40 US range.

Survival for the Edmonton/Calgary Oil Sands

It is widely speculated that the break even point for new Alberta oilsands projects is a target of $44 US per barrel, while the break even point of existing Edmonton oilsands projects is in the low $30 US per barrel, a price that oil has already touched on several times in the past quarter. So are the Alberta oilsands projects in trouble and will existing Edmonton and Calgary economies remain more stable than the rest of Canada through 2009? Well, with the recent headline news that BA Energy Inc which is the developer of the Heartland Upgrader $4 billion project near Edmonton real estate, there is no safe place in the world during this global economic crisis. With cash flow shortages, tighter credit laws and an angst against possibly losing money, the Alberta oilsands new developments have been temporary put on hold until the economic environment improves. The most recent Financial Post headline news story from January 15th explains that spending on the oil sands in Alberta may actually drop more than 50% compared to the spending during 2008. A reduction in oil and natural gas prices as well as the lower demand for these commodities have driven many Alberta oil sand projects off the table for now.

How Does The Drop in Oil/Gas Affect You in Alberta?

There are many things that will happen in the next year and during the last two quarters of 2008 and the first month of 2009, a hefty drop in oil and gas prices have basically stalled the once booming Alberta economy. Much of the economy is based on oil and gas in Alberta, and with the recent decade worth of boom times, both Edmonton and Calgary real estate markets saw substantial increases in value. Property prices skyrocketed while wages also increased in order to keep up with the cost of living, and therefore, everything was offset. However, during the recent drop in oil and gas prices, employment has staggered and layoffs have started. What this brings is a drop in wages and jobs available in the Alberta oil sands projects and other industries that depend on the oilsands in order to survive. With unemployment rising (the most recent tally is a loss of 16,000 jobs in Alberta in December), less people can afford property and to buy their homes. The most recent drop in the Edmonton real estate market (both pre-sale and resale homes) as well as the once hot Calgary property market and everything in between in Fort Saskatchewan and Red Deer as well as Fort McMurray is a cause for concern for those who purchased at the peak of the market. It is widely speculated that both the Calgary and Edmonton real estate markets have crashed about 17% from its peak already within one year. Spending has also decreased as more people are saving their money in the bank. With deflation a thing creeping into the Alberta economy, many people and consumers are waiting for the best deal that may come next month and postpone spending their hard earned cash until they spot the best deal in town. What this does is it stagnates the economy and makes things even worse. All of this is because of the most recent boom that happened too quickly and the sudden drop in oil and gas prices around the world. The Alberta oilsands delays and cancellations will have a profound effect on the Alberta economy in 2009 and with the recent royalties imposed on the gas and oil companies, the recovery period may take a while longer.

Our Perspective on the Calgary and Edmonton Real Estate Bust and the Oilsands Future

Headlines is headline news. It’s main purpose is to sell more articles, magazines and newspapers. With so much negative news about the Alberta oilsands, we take things in perspective. The Alberta oilsands has been the top discovery of commodities, oil and gas in recent memory and with it came an incredible boom time for Albertans. Everyone enjoyed something from the oilsands projects in Alberta, whether it be blue collar or white collar jobs working in Fort McMurray, or real estate investors who saw their properties double in value in less than a year or even to people living outside of the oil sands areas like Edmonton and Calgary that had to build infrastructure to house the many people moving into the province through in-migration. Having the lowest unemployment rate in Canada (close to the low 3% at one time and now only creeping up over 4% .. still the lowest in Canada), Alberta has seen a boom time that has not been rivaled by any other province, not even close. With the sudden increase in housing prices throughout Edmonton real estate as well as the Calgary marketplace, people forgot to due their due diligence and ran with the dream of making a big fortune by flipping or buying/selling huge numbers of properties. Although the economic outlook is grim and the demand for Alberta oil and gas has diminished, Alberta has a great thing going for it. With the world’s largest deposits of investable oil, the oilsands of Alberta will be key to the turnaround of Canada’s economy. Enjoying the highest GDP per capita and a growing population, the Alberta oilsands will become the economic engine for Canada in not too distant future. As the US has embraced self reliance on energy, oil and gas, Canadians have to agree that the Alberta oilsands near Edmonton house more than enough oil to keep the country going for decades to come. Yes, there is a lot of money being pumped into alternative energy sources in North America and in Europe, but the two developing nations in India and China will continue growing at an astronomical pace and their demand for oil will certainly skyrocket. Each with a population greater than 1 billion (yes, that is more than North America and Europe combined in one single country) and with a 2009 GDP growth estimated at 5% and 7.5% respectively (revised this month in January 2009), India and China have had talks with the Alberta oilsands to make sure that they can claim a stake in the oil and gas in the future. The demand for oil has slowed down, but it is temporary. So instead of a moderation in spending and oil production in the Alberta oilsands through to 2020 (and a stabilization of housing prices through that period in the Calgary and Edmonton real estate markets), we now see a period of delays and cancellations of oilsand projects in Alberta (and a subsequent drop in Edmonton and Calgary housing prices). Once the demand for oil and gas increases again, we predict another huge boom that will be triggered by an onslaught of new Alberta oil sands projects starting and existing oilsands projects working at full capacity. Employment will again skyrocket, followed by jobs, minimum wages, spending and of course, another increase in the housing prices of both Edmonton and Calgary and everywhere in between. It is not yet known how long this economic crisis will last, but rest assured, another boom time will be coming maybe in a year, 5 years or 10 years. Hold tight, enjoy life and stop speculating, because speculators will never will all the time. True investors always win in the end.

Welcome to the Alberta Investment Blog - A Resource for Edmonton & Calgary Real Estate Markets, Oil & Gas, Economy and Other News

Thank you for visiting the Invest in Edmonton Real Estate Blog.

Here you will find information about the real estate market in Edmonton and its surrounding communities in addition to details about the state of the market in Alberta. Fueled by the growth in Fort McMurray and the oil sands of Alberta, Edmonton is growing at a fast pace and real estate has boomed. From homes to master-planned communities and from real estate properties to condominium towers, Edmonton Alberta is the place to be when it comes to jobs, entertainment and real estate investments.

Read further to learn more about the various Edmonton real estate investing portunities right now with 4AM Properties Ltd. From joint venture deals to lending money, 4AM has a right fit for any investor who wants to get a great return on their investments.

Welcome again to the Edmonton Real Estate Investing Blog 2009.