OPPORTUNITY IS IN THE EYE OF THE BEHOLDER
Fearful or greedy? Start of the boom versus start of a recession? Buyer beware or Buy as much as you can, as fast as you can? In a room of 10 real estate investors, you’ll probably hear 10 different opinions.
And the funny thing is, only 20/20 Hindsight will be right. Not one of those 10 people will have accurate predictions. Even the best economists in the country cannot possibly predict a wild card event that might happen, half way around the world, with unexpected and significant consequences for our little properties. But doing nothing doesn’t work either.
We’re paying attention to the economic and social fundamentals, watching patterns, and searching for trends. Then we plan accordingly, and adjust as necessary. No expectations of guarantees. We’re simply making our next moves for our financial freedom.
Today is our monthly update. Read, share, comment or argue –it’s all good! Because that means you’re paying attention too.
- Canada’s GDP was down for Q3 by 1.1%.
- Magically, Q2 GDP was revised to a positive 1.4% (had previously been reported as -0.2%).
- So the country isn’t in a technical recession for now.
- In the USA, GDP was +2.1% for Q2, and a hot +5.2% for Q3 (annualized numbers). Our neighbours have a very different economic story right now, when compared to Canada’s economy.
- We don’t have AB GDP numbers, but we did get a provincial fiscal update this week: income is up, expenses are up (you’re shocked, we know), but overall there is a $5.5 Billion surplus, as things stand for now!
- The most recent population numbers are still from Q3: “ In Q3 2023, Alberta’s population reached 4.7M, up 4.1% from Q3 2022.” https://economicdashboard.alberta.ca/dashboard/population-quarterly/.
- Alberta employment grew by 8900 jobs in November, but this was offset by more people looking for work, so Alberta, Calgary and Edmonton all saw small rises in unemployment rate. In contrast, Lethbridge saw a dramatic drop and now has an unemployment rate of 4.3%. Yikes! Glad we don’t need to find employees in Lethbridge this month!
- Overall, “Alberta employment sits 4.1% (or 98,800) higher than the same time last year—well above the national rate of 2.5% and second only to PEI.” https://www.atb.com/company/insights/the-owl/atb-economics-weekly-wrap-december-1-2023/. What this means to real estate investors is that even though our population is growing, Alberta is creating almost enough jobs to absorb all the newcomers. (ie our tenants can be employed!).
- The November national rent report shows rental pricing continuing to increase by 9.9% year over year. https://rentals.ca/national-rent-report.
- Calgary saw a rental price increase of 14.2% since November 2022 for 1 Bedroom, and 13.2% for 2 Bedroom. Alberta saw overall rental price increases of 16% year over year. AKA: there are still ample customers for rental properties in our city and province.
- Benchmark real estate price for Calgary is up 10.7% year over year, BUT for 2023 (since January) the Benchmark price is up 5.0% https://www.creb.com/News/CREBNow/2023/December/Price_gains_continue_in_Calgarys_real_estate_market_as_inventory_remains_low/.
- Real estate listings are up 38.2%! But inventory and Days on Market remain low because demand is still so strong. We are still in a seller’s market.
Behold all the beautiful colours of the Alberta and Calgary economic and social fundamentals! Or you can check out the colours of inflation and interest rates. Or you can be certain that oil is about to fall even more in price, or …. Or you can do backflips about the recent Dow Chemical plant announcement. How we choose to see the world gives us opportunities for our financial freedom. If you love Gold, choose that. If you like this phase of the real estate cycle in Calgary and Alberta, feel free to connect with us any time.
