WHAT’S UP CALGARY?!
It’s the first week of May, 2022 and momentum continues to build. The grass is finally turning green, the deciduous trees are rapidly coming back to life, the birds are building nests all over the place and its shorts season (by Alberta standards anyways). Even the city is coming to life with a little playoff action; Calgarians are thrilled to be out enjoying sports, entertainment and patios.
The overall energy in and around Calgary is reflecting the city and province’s economic recovery. Here’s some of the stats you may want to be aware of as real estate investors.
Long story short, GDP numbers are a guesstimate, long before the real numbers come in. StatsCan gave their 2021 update just a few days ago: Alberta’s real economic output for 2021 came in at 5.1%. In any other year, we’d be thrilled; but a reminder that GDP dropped 8.0% in 2020. So according to the numbers, we’ve made great progress, but we’re not yet back to 2019 GDP levels.
Now, what if we compare the stats to the real world? Just about everyone is looking for staff! Many people and businesses are working long hours. Even inexperienced teenagers are in high demand and can choose their employer!
So that leads us to today’s unemployment numbers:
Canada’s unemployment is down from 5.3% in March to 5.2% in April.
Alberta’s unemployment is down from 6.5% in March to 5.9% in April.
Edmonton’s unemployment is down from 7.1% in March to 6.9% in April.
Calgary’s unemployment is down from 7.7% in March to 7.2% in April.
The mainstream media headline is about how Calgary currently has the highest unemployment of all 34 metropolitan areas that Stats Can keeps track of. May we point out that the headline ignores a big drop in unemployment?!
So what does all this mean in the Real Estate Investor’s world? Well real estate sales are up 6% year-over-year, and are at a record high for April in Calgary. Alas, most of the headlines only talk about how sales in April were less than in March. This is true, but ignores the bigger picture! Calgary’s overall Benchmark Price is now $526,700. Bring out the cheerleaders: this is 16.9% up year-over-year, 2% up month-over-month! Detached prices are up 19.1% year-over-year, and the Benchmark Detached Price is now $628,900. Part of the reason for the price increases is ongoing limited supply (only 1.43 months of supply are available in the Calgary market).
Anecdotally, many landlords are receiving multiple applications for properties, and have been able to raise rents—not to the stratosphere, just reasonable increases. And for those of us living and working in the city, have you noticed all the BC and Ontario plates lately? It’s not summer vacay season yet –those aren’t stampede tourists.
We’re usually a bit cautious, but there are so many positive signs! Yes, we hear the naysayers with recession concerns, interest rate fears, and inflationary boogeymen tales. But we love the affordability in Alberta and the strong economic fundamentals that we’re seeing. Time to Carpe Diem!
