If there was any doubt that Edmonton wasn’t one of the best cities in the province, it’s gone now. REIN recently released their list of top Alberta towns and cities, and Edmonton snagged the best spot.
What does first mean? It means REIN believes it has the best potential for the next five years for growth and investment. It’s no surprise, really. Our city is located in the center of the province and is the hub of several major transportation routes. It’s not hard to see why Edmonton weathered the economic slump better than many other areas of the province. It’s also expected to be one of the first cities to exit the downturn.
Factors that Propelled Edmonton to the Top
One of the reasons Edmonton has done so well during the slump is because it prospered under the Alberta government mandate of hiring several new government employees. Over the last two years, this mandate has been one of the major job creators for the city. By hiring additional employees, the government has helped Edmonton’s housing market through this bleak period.
Edmonton’s diversity has found a way to benefit the city, too. According to national studies, Edmonton is often one of the top three most diversified economies in the country. For us who live here, it may not seem like it, but it is, and it has buffered Edmonton’s housing market during the recession. The city’s diversification also poises Edmonton to be one of the leaders when it comes to the next economic boom. Although the past few years have left us a little worse for wear, a healthy GDP, one that’s above the national average, is forecasted for Edmonton in 2018.
Since the city is expected to see a jump in GDP growth, employment and job creation are next in line to follow. In 2016, Edmonton had a booming population of 932,546 and grew 14.8 percent from 2011 to 2016. This number puts it among the leading growth cities in Canada. When 2017 arrived, this growth rate didn’t continue, but it’s expected to once again rise.
Edmonton’s Housing Reality
Careful and thorough research shows that the average selling prices for homes are increasing, but monthly rents are decreasing. The slight upward trend in selling prices indicates the market is creating a foundation from which to build on. The largest year-to-year price increase was found in condos because of the large number of new units built and sold.
As for rent decreases, Edmonton’s average single-bedroom monthly rent rate was found to be $910. Compared to 2016, this number is almost a 10 percent decrease. Edmonton is also quite a bit cheaper than other major cities in the country. Two-bedroom rent rates are a little bit higher; they only dropped four percent. Overall, though, rents remain on a downward swing. The good news for investors, though, is that Edmonton is a unique combination of a large metropolitan area with a diverse economy that also happens to be affordable.
Real Estate Tactics for Investors
According to REIN and the data they’ve found, Edmonton appears to be in the middle of the economic slump. A good tactic to use during this time would be the buy and hold technique. Using this technique is plausible at the beginning of a slump, good in the middle, and optimal at the end. Investors looking to expand their portfolio should buy an apartment now, and hold onto it until the market recovers if they want to make more money.
Edmonton has done an exceptional job of weathering the awful economic storm that hit the province. Our city is expected to be one of the first to exit the recession, so real estate investors have that to look forward to.