According to a report by Laurentian Bank Securities economic growth within Alberta and Saskatchewan is expected to outpace Canada’s other provinces and territories.
The Provincial Monitor stated the two Prairie Provinces will be the driving force behind the national average while the central and eastern provinces will report a weaker performance than the national average.
The positive economy in Alberta is also being reflected in the housing market.
“This year both Edmonton and Calgary should see their housing market activity return to pre-recession levels,” said the report. “New housing starts in the condominium segment, which is much more prominent in Calgary, as well as the number of current listing on the resale market, were both higher in 2011 as a consequence of the 2009- 2010 market slowdown.”
Positive housing market activity in the two Prairie Provinces is also reflected by building permit values; in Calgary for instance, as of June, year-to-date building permit numbers in Calgary were up 6.5 per cent compared to 2011.
“Thus the boom in new construction that is ongoing since the beginning of the year is fully justified and is also the result of higher perspective of population growth,” said the Laurentian report.
According to Calgary’s 2012 Civic Census, Calgary’s population is 1,120,225 an almost 30,000 resident increase compared to 2011’s count. The natural increase — a result of excess births over deaths — decreased by 227 compared to last year but net migration returned to similar levels seen in 2007 and totaled 19,658.
Another sign of Calgary’s return to pre-recession levels is the city’s vacancy rates. The Provincial Monitor reported Calgary’s vacancy rates have fallen for the second year in a row reaching their lowest point since October 2007 going from 3.6 per cent to 1.9 per cent.
“As for vacancy rates in the rental condos segment, they remain about the five per cent level due to lower demand,” stated the report. “Because of a considerable gap between rents on the housing and condominium rental markets, the former has attracted much more demand.”
The report stated it is currently 40 per cent more expensive to be an owner rather than a tenant in Calgary, a gap of note that should boost the expansion of the rental market and condos in order to reduce the impact of affordability.
In mid-July, CREB® Real Estate News reported according to the Canadian Mortgage and Housing Corporation (CMHC) that apartment vacancy rates in Alberta’s urban centres decreased from 4.7 per cent to three per cent between April 2011 and 2012. The CMHC reported the average two-bedroom apartment in the Calgary Census Metropolitan Area including new and existing structures was $1,113 per month.
What do you think about the ever expanding Calgary? Share your thoughts in the comments below.