Developer Frank Kernick says the majority of buyers for his Spring Creek project in Canmore still come from Alberta. Photo by Michael Buckley.

Westward Bound

Calgarians playing a role in driving home sales outside of the city

Founded largely by intrepid pioneers who ventured west on the then fledgling Canadian Pacific Railway, Calgary is now seeing another western excursion.

With home sales in the city facing downward pressure as a result of a weakening labour market, markets west of the city – small and large – are seeing increased activity, thanks in part to Calgarians continued urge to drive westward.

From as near as the Rocky Mountains to as far as the West Coast, Calgarians are being pointed to as contributing factors in real estate markets outside of the city.

As the developer behind Canmore’s Spring Creek, a $38-million “active lifestyle community” for seniors, frank Kernick has seen the impact of Calgary buyers outside of the city.

“From the demand point of view, the last three months in Canmore have probably been the strongest January, February and March I’ve seen in 10 years,” said Kernick.

According to Kernick, Canmore recorded its highest number of sales ever for the month in January, with 32 homes trading hands, up from 12 in the previous year. The upwards trend continued in February, with a 58 per cent increase in sales, from 24 to 38 homes sold, according to Spring Creek Realty.

Compare those numbers to Calgary, where the benchmark price totaled $442,800 in March, a 0.49 per cent decline over February and 3.51 per cent lower than levels recorded last year. March home sales in the city totaled 1,588 units, 11 per cent below the same time last year and 28 per cent lower than long-term averages for the month.

As to who’s buying homes in the area, Kernick said the overwhelming majority of sales still come from those living right here in Alberta.

“There are a few Americans taking advantage of the low Canadian dollar and buying as an investment, but the majority of the people buying are still Canadians and Albertans.”

“There’s still that baby boomer out there who still wants their place in the mountains and a semi-retirement/recreational property with the intent of making it their long term home… and obviously the people that might have two years ago bought in the [United States] for their recreational/semi-retirement home, because of the dollar, are not going to invest in the U.S. at this time are and going to put their money somewhere else.”

Kernick said he’s also seen an increase in the number of Albertans taking advantage of the current exchange rates by selling off properties south of the border and using the profits to purchase closer to home.

“And for the majority of Calgarians, if they want to be close to Calgary it’s got to be Canmore because they can’t buy in Banff,” said Kernick.

Signalling that some are willing to move a little further west, Kelowna has also seen a rise in the number of homes changing hands. A long-time mecca for Calgarians looking to add a little relaxation to their lifestyle in the form of a retirement or recreation property, B.C.’s Central Okanagan Valley saw sales rise by 14.6 per cent through the first two months of 2016.

Highlighting the demand for product in the area, one Kelowna condo project recent saw more than 600 people gather for a chance to sign on the dotted line. A project from Okanagan builder Mission Homes Group, Central Green is a seven-building, 500-residence master-planned sustainable community set to transform five hectares in downtown Kelowna. Boasting heritage-inspired architecture, an expansive new two hectare park, and immediate access to amenities, the project took in $10-million worth of sales in the opening weekend alone.

According to the president of the Kelowna-based company, sales in the area have not been affected by the downturn in Alberta’s energy sector.

“There are a few Americans taking advantage of the low Canadian dollar and buying as an investment, but the majority of the people buying are still Canadians and Albertans.”

“Albertans continue to play a role in the development of residential housing in Kelowna, interest in living here remains strong and steady,” said Shier in a February interview in the Calgary Herald, adding that Albertans have historically accounted for 15 per cent of purchases in the area – a number that hasn’t changed despite the state of the economy in the province.

Moving to the West Coast, Victoria is another city where Calgarians are making their presence known. Offering a more affordable urban alternative to Vancouver’s outlandish home prices, David Langlois, a broker with McDonald Realty in Victoria, said he’s seen a rise in the number of Albertans

“I would say that generally we have seen an increase of probably 25 per cent or more of Calgary and Alberta people [buying homes in Victoria] and anecdotally, I believe up-island they’re seeing more as well,” said Langlois.

According to Langlois, one reason for the increase of Albertans choosing island living is the ability, having set money aside during better times in the industry, to “check out” earlier than originally planned.

“The Albertan who was in the oil patch, and has done quite well, and they were planning to come out here to retire regardless, and they’re choosing to do so a little earlier now. They don’t want to wait for the cycle to roll around again,” said Langlois.

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