RECOVERY VERSUS A DOUBLE DIP??
The first time we posted an article with this image, it was all about supply, supply, supply—like 7 months of supply on the real estate market!! Today’s picture is very different. Many areas around Calgary are down to roughly 4 months of supply (we focus mainly on detached homes); the experts call this a balanced market.
So what has so many people talking about a slide deeper into recession? Consumer confidence, and hope. Many home sellers have stopped believing there is hope for the Calgary and Alberta markets. They’ve lost faith that federal or even provincial governments can lead the province out of the downturn. Even the traditionally “safer” jobs in health care, education and government roles are being cut. And many of these sellers have burned through savings, loans, and even relationships—now they have to sell. Early numbers are suggesting 2019 was the lowest year for real estate sales in 23 years, and early predictions are that 2020 looks the same or worse.
That’s how consumers and home sellers are thinking.
As a real estate investor, we see the housing market AND the rental market. If you don’t need to sell as an investor this year, your priority is the rental market. Remember 2016 when rental prices were tanking, and potential tenants arrived at a showing asking “well, what will YOU give ME if I agree to rent? Free TV? Free Wifi? …” 2019 has a very different rental market and we are eagerly awaiting the CMHC report for some evidence beyond “word on the street.” The bottom line is that when people can’t buy (lower incomes, recent divorces, new to a job—sound familiar Calgary?), they have to rent. As Rental Housing Providers, we still have a lot of customers!
So while consumers and a plethora of media “experts” are ready to jump ship, savvy real estate investors are quietly searching for the very best deals. The smart ones then create the best possible product (paint, repairs, flooring). Good marketing is still bringing in tenant applications, even in these traditional tough months of December through February—everyone’s gotta live somewhere! And strong customer service is keeping tenants in their current suites and homes—because who in their right mind moves at -30 degrees if they don’t have to!
As real estate investors and rental housing providers, all is definitely not lost in the Alberta market. Rather, opportunities abound for those strategic investors who can see beyond the headlines. Want to be included on our deal list? Connect with us https://mountainsedgedevelopments.com/, or @MtnEdgeDevelops.
