Alberta Economy Looking Up!

edmonton_800While the nationwide economic picture still looks pretty grim, Alberta’s economy experienced relatively strong growth of about 4% in 2010, and is expected to enjoy modest growth through 2011, according to Troy Media.

Recovering crude oil prices seem to be driving most of this growth, which would be even higher were it not for sluggish natural gas prices. Still, in the shadow of the Great Recession and the biggest economic freefall since the 1920s, 4% growth – heck, 1% growth – is a good news story; especially when we note that other parts of the country are still struggling mightily to right their local and regional economic ship.

How the “Modestly Growing” Alberta Economy Impacts Home Buyers and Sellers

As I’ve blogged about a few times – and will surely blog about again – the real estate market is influenced in many ways by the overall health and stability of the prevailing economic picture.

For starters, a stable, growing economy bodes well for job growth, which will put some upward pressure on housing demand – which, in turn, will reduce the supply available. Depending on the intensity of both of these forces, housing prices should continue climbing upwards here in Alberta (a prediction that has been verified by other experts and observers).

However – and this is where things get even more complicated – interest rates are likely to remain at very low levels. Though I don’t think we’ll see the Bank of Canada rate going down to the .5% levels we saw early last year (because the overall Canadian economy is still struggling to pick up steam), it’s unlikely that we’ll see any severe rate increases throughout 2011. That’s because the higher the rate, the more expensive it is for Canadians to borrow, which means they spend less – which doesn’t help the economy.

For Edmonton buyers and current home owners, this likely means a couple of things: variable rates will probably start to rise, while fixed rates hover around their current levels. So if you have a mortgage or are looking to get one, it’s important to understand the bottom-line costs of variable vs. fixed mortgages in this economic climate. If you need help understanding the ins and outs, please call me and I’ll be happy to connect you with the right information.

For Edmonton sellers and those thinking of selling, this is a very good time to list – because while it’s expected that average home prices will modestly increase over the year, so will interest rates – which means it’ll be more expensive for potential owners to do a deal. In other words: it may not be to your advantage to wait several months to see a (possible) 2-3% rise in home prices, if it means that fewer people can afford the home – which means less competition, and possibly a lower offer being received.

Indeed, this is all interesting – and a little bit complicated – stuff! My advice to both Edmonton buyers and sellers (especially first timers) is not to get lost in the economic data, but to call me so that we can build a clear and concrete plan that fits YOUR unique goals. When you do that, you have much more control over how to position yourself in the market – and increase your chances of a successful, satisfying and stress-free transaction.

Call me at 780-709-0811 – I’m here to help!

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Buying your first home is an exciting but also daunting task. While you are trying to find the perfect home for you and your family, you have to worry about the paperwork, technicalities, and legalities. Working with Chris, that part of the home-buying process was taken care of. When my brother and I bought our first home, Chris took the time to explain the process to us step by step, and I felt the process was really simplified. He explained all the details, provided advice as required, and answered all our questions, sometimes before we even asked. He worked around both our fulltime schedules, and was constantly in contact with us, even if it had to be early morning, later in the evening, weekdays, or weekends. What I appreciate the most about Chris is the fact that he is devoted to his clients. The first time I saw my home, we did not actually go in to see it, because there was an offer on it. Chris followed up on it and a couple of days later he let us know that it was back on the market. We put in a competing offer and unfortunately the sellers went with someone else’s offer. Yet again Chris kept us in the loop about this house, and for whatever reason, the sale did not go through. This time around, the sellers accepted our offer, and everything worked out. If it was not for Chris’ diligence and dedication, we might have missed out on what was meant to be ours. It is a beautiful home and I thank Chris so much for his hard work. He helped us find exactly what suited our family. He was always available and easy to get a hold of. He pointed out both pros and cons of each house we looked at, and I appreciated his honesty. It was not just about making a sale, but helping us find what we needed. I would without doubt recommend him to anyone buying a home, whether it is their first home or not, and I will definitely be coming back to Chris if I need to buy or sell a house in the future.

- Nada Nsier – Medical Laboratory Technologist, BSc (MLS)

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