TUNNEL VISION
Perspective is a funny thing, especially for real estate investors. We can be biased, or drink our own Kool Aid, or simply forget that our little world/city/town is deeply affected by issues FAR beyond our “tunnel.” Keeping up with the latest “news” can help, but requires a fair amount of sleuthing these days.
One of my favourite real estate lessons came from Don R. Campbell (author of Real Estate Investing in Canada, which is still a great resource). When he presented at events for the Real Estate Investment Network, he often did a segment called “Behind the Curtain.” Oh how appropriate that lesson is in today’s media and social media world! The presentation began with the headlines. So for example, this week’s headlines about Canada’s inflation rate. Yikes, doom and gloom! At least according to many news outlets. But then Mr. Campbell would dig deeper, or “peel back the onion,” as he described it. He offered us better perspective on the bigger picture.
This week I found an article by Avery Shenfeld at CIBC, that adds a little perspective to Canada’s inflation rate: https://economics.cibccm.com/cds?id=a6867637-71df-447d-8882-b6d38479b67d&flag=E. The article is comparing inflation and a few other economic factors between the UK, the USA, and Canada. Ah, perspective. Now if only I could find a decent explanation about how raising Canada’s interest rates will have ANY impact on global oil prices—but I digress.
Canadian’s perspective these days very much depends on where in the country they live. I have noticed that some of our Ontario colleagues are deeply concerned about negative cashflow in some of their properties. They are also worried about possibly even lower real estate prices in some areas, complicating potential exit strategies. In contrast, the economic outlook for Alberta and especially our local real estate and economy is quite different. Same country, just a few provinces over.
ATB released their provincial forecast this week: https://www.atb.com/siteassets/pdf/company/insights/outlook/economic-outlook-september-19-2023.pdf. HOLY COW! 200,000 new people in Alberta in just one year! So this province just blew the previous record out of the water. Yes, we understand, it’s “just” a forecast. But we are listening carefully to the driving forces behind the predictions.
Are we completely jumping up and down with rose-coloured glasses? Nope. In our little corner of the world, there are still many challenges – smart real estate investors may read challenges as opportunites. Home base for us is Bragg Creek, just 35 km to Calgary (currently viewed as a rising star in the real estate world). This little community is also just 90 km to Canmore, a real estate market that has been described by some as “hotter than hades.” So there is proximity to HOT markets, but yet that isn’t our reality. Some land here has lingered on the market for over a year, some properties are being sold well below their asking prices. Huh. Sounds like it’s time to peel back the onion, doesn’t it?
As much as we are blessed with gorgeous fall colours this week, we are also blessed with open minds: always listening and learning from people SO very much smarter than we are. Last weekend I had the opportunity to connect with a small group of fabulous investors. This weekend we are also connecting with real estate investors at Fearless Real Estate Calgary. We’ll be learning and expanding our perspective with experts and leaders from across the country. Tunnel vision be gone!
The journey for real estate investors involves many twists and turns, and even tunnels. Each time the road and weather changes, we are grateful for networking and learning opportunities. Cheers to your strategic growth too!
