For years, Vancouver and Toronto have been the hot spots to live. But, while people have been demanding to live in these two places over the past two or more years, home prices have been climbing. Now that it’s tougher to get a mortgage – anywhere in Canada – those high prices don’t seem so attractive anymore. And it’s these two cities that are likely to be hit the hardest as demand weakens and home prices fall. It’s for all of these reasons that Vancouver and Toronto now have to step aside as the best places for real estate in Canada, as they make room for Calgary and Edmonton.
This is according to the Emerging Trends in Real Estate 2013, a report done by PwC and the Urban Land Institute and that was released last week and that states that even with current uncertainty, Canada’s real estate market as a whole is “modestly good,” and is expected to remain so throughout 2013. But, Calgary and Edmonton both stand out as the two places that will most likely beat even the “modestly good,” and could be coined as “excellent.” But, what’s ironic is that there may be things holding both cities back from achieving true excellence when it comes to their real estate markets; and that’s the exact thing that’s putting them at the top – simply being one of the best places to live.
The report states, “Growth characterizes Calgary’s future; it displaces Toronto as the top ranked city for 2013. This had made it challenging to acquire high quality real estate in Calgary, absorption of prime properties has reached record levels, and rents are being pushed due to limited supply.”
And while Canada’s “moderately good” status may remain so through to next year, the problems that Canada’s two top cities are also expected to stay throughout 2013, too.
“This trend will continue in 2013, especially in office and industrial employment space. Construction will increase in the housing and non-residential arenas, but nowhere near pre-crisis levels.”
And while many may be putting pressure on Mark Carney to raise interest rates to help keep any potential bubble out of all of our cities, Lori-Ann Beausoleil, Canada’s Real Estate Leader at PwC says that it’s that exact policy that has helped Canada’s real estate market remain as stable as it has.
“The results of this year’s Emerging Trends report reflects the fact that the Canadian real estate community understands real estate fundamentals and knows how to react to fluctuations in monetary policy and capital markets. Canada’s real estate industry continues to operate well despite uncertainties in domestic and global economies,” says Ms. Beausoleil.
So Calgary and Edmonton may have their challenges. Don’t all Canadian real estate markets? But for the time being, they reign supreme, despite them.