Spring is here! How I know this is as I look out my office window I see 3” of fresh snow. Isn’t life in Calgary wonderful?
In my previous updates I have discussed the strengths of the Alberta economy. I am now seeing significant signs that the economy is influencing the Calgary area market. I have been monitoring recent improvement in the rental market as an early indicator of changes to the resale housing markets. CMHC reported that during the heavy market activity in 2006 the apartment vacancy hit a low of .05%, then after the financial crisis in 2009 the vacancy rate peaked at just over 5%. The latest 2011 report shows the rental market is again strengthening with vacancy rates under 2% allowing rental rates to increase.
CMHC also mentioned in their recent Rental Market Report “Economic activity is expected to continue supporting rental demand in 2012. Investments in the energy sector are promoting economic growth in Calgary, creating jobs and attracting migrants. The gain in migrants in particular will contribute to rental demand as many of them will likely look to rent and familiarize themselves with the region before purchasing a home.” They also forecasted the following “As a result, vacancies throughout the forecast period are anticipated to remain low at under three per cent. With more people looking for rental accommodations, rental rates are anticipated to increase.”
This is not only good news for landlords but also for the future of the housing market. As vacancies tighten, rents will increase and put pressure on tenants to take advantage of very low interest rates. In the past a strong rental market has been associated with a strong resale housing market.
If you would like to discuss the market in detail or would like us to update you on the value of your home please do not hesitate to call. Our preferred mortgage broker Jason Dodd with Verico Maximum Mortgage Inc. is also available to help you with any question you may have on these historically low interest rates or mortgage options. He can be reached at 403-815-0565.
As always if you or someone you know is considering a move, Lone and I would be honoured if you passed along our names. We promise to give your referral the same uncompromising service that you have come to expect from us.
Real Phaneuf, Realtor Royal LePage Foothills