by admin Calgary is a cosmopolitan city in Canada. It is found in the western province of Alberta. It has an area of 825.3 square kilometers. This city is home to a population of over 1.3 million people. This is a very nice city where you can live and enjoy life. A lot of things are available in this city and life here can be very amazing if you choose to try it. If you want to relax and enjoy, several places such as Big Rock Brewery, Calgary Stampede, Calgary Tower, Olympic Plaza, Catch a Calgary Flames game, and Prince’s Island Park is all at your disposal. There are pre-construction homes in Calgary that you can grab for yourself and be a homeowner within a short time if you decide to move here. Real estate prices in Calgary have been going up and the trend is still going on. The trend is so because 2021 was a good year and it ended strong as far as the real estate market is concerned. 10 reasons Calgary Real Estate prices are going up in 2022 are as follows.
- Supply and demand for housing
Demand and supply of real estate properties especially commercial and residential houses are always at the center stage of the real estate market in any town or city. In order for supply to be there, demand must already be existing. In this case, demand refers to the need for people to have houses. You cannot supply what is not needed and that is why demand and supply go hand in hand. The people buying the houses can be just normal buyers who want to own homes or can be investors who are looking forward to making profits in the field of real estate. Demand is demand and it doesn’t matter the type of buyer or the purpose of buying a particular investment property. On the other hand, supply simply refers to the availability of houses. These houses are usually made available by different developers and investors in order to take care of the demand which in most cases is always rising. The demand for houses in Calgary has always been high and it is the factor that is really driving the real estate market. Home resale activity has been going up in Calgary even as other cities within Canada are experiencing a decrease in home resale activity. According to reports, home resales in Calgary continue to be above the pre-pandemic peak levels. This has made it impossible for the supply to fully catch up with the demand. The majority of the people are in need of houses but the available houses are few making the demand outweigh the supply in Calgary. Through this high demand, the few available houses are always up for grabs at higher prices compared to other areas that might have low demand. At this point, buyers are always more than willing to pay the high prices that are listed in the market. This willingness plays part in the rising of real estate prices. The prices of detached homes in Calgary are also going up due to this factor. All the potential buyers should be aware of this so that they can act knowing what the real picture is. Calgary is not the only city experiencing this demand and supply imbalance. This is something that occurs in most major cities in Canada.
- Mortgage Interest rates
Interest rates have a great impact on the real estate market in any place that you can think of. Interest rate is a deciding factor when it comes to a buyer’s ability to purchase a property. Low interest on mortgage loans greatly influences the rate of home ownership in any given town or city all the time. The low interest on mortgage loans will increase the number of homeowners because almost everyone will be interested in getting or buying homes at low interest. This simply means that the demand for housing will be higher than even expected. Many people from even outside that town or city will flock to the real estate market in search of better and more affordable homes. High demand for housing will definitely make the real estate prices go up because sellers will have a wide pool of buyers out of which many are willing to pay anything just for them to get the home they really desire to own. Being one of the more competitive mortgage markets in Canada, Calgary still offers its residents with lowest mortgage rates. This is something the residents of Calgary can be proud of and feel better about compared to the residents of other cities where the mortgage rates are extremely high. Although the buyers will be attracted to the low mortgage rates, demand for housing will grow quickly and eventually lead to an increase in real estate prices. Because of the low mortgage rates currently witnessed in Calgary, people are streaming into this city in search of good and affordable homes thereby tremendously increasing the demand for housing. This demand is expected to go on for the better part of 2022 as long as people continue having the need of buying both commercial and residential properties. As long as the high demand is still there, prices of real estate properties will keep going up from time to time because many buyers are in need and therefore the sellers in the market have no fear of not getting potential buyers of their properties. This lack of fear is what then makes them find it easy to increase the prices of properties as time goes by. So if you are thinking of buying a house in Calgary just keep in your mind that prices are not going down any time soon. In fact, the prices are on their way up as the year progresses. Don’t wait until 2022 is over because you might find prices that you may not even say a word about them. Also, take note of the rising prices of pre-construction homes in Calgary.
- Location and area desirability
A town or city that is strategically located and has desirable features always stands out from the rest. People will always want to be associated with such a town or city. They will do so because they want to feel good and special and also get to know the better part of that town or city in and out. It just brings a good feeling naturally knowing that you live in or you have invested in a town or city that almost everyone is wishing to be there. That must be among the best feelings ever that anyone can enjoy in this world. All these are what describe Calgary city in Canada. This city is well located in a very fantastic environment that enhances growth in almost all sectors. It is right adjacent to the foothills of the Rocky Mountains. This itself gives you a very nice attraction site. Calgary is a city that is very desirable because of what it offers and also the attributes it has. Since some time back, this city has been in the limelight and many have yearned to be part of this magnificent city. This city was ranked as the cleanest city in the world four times in 2002, 2004, 2006, and 2007 by Mercer Human Resources Consulting. This should tell you that this city started to be clean long ago and therefore it has been desirable for all this while. In 2011 it was named the sunniest city in Canada by Environment Canada. This explains more about the perfect location of this city. If that is not enough, this city was been nominated three consecutive times in 2010, 2011, and 2012 as the fifth most livable city in the world by Economist Intelligence Unit (EIU). In 2022 Calgary has already been ranked as the third most livable city in the world by Economist Intelligence Unit (EIU). Among the three Canadian cities listed in the top 10 list, Calgary is the one ahead which means it is the number one most livable city in Canada. Quite a lot of factors were considered before ranking the most livable cities in the world. Some of the factors are access to healthcare, crime rates, infrastructure, cultural and sports activities, and the amount of green space. If Calgary managed to excel in these factors then it means it is a very fantastic city. Generally, this city is considered one of the safest and healthiest big cities in the world. Being at this status in 2022, you cannot expect the prices of real estate properties to be on a downward trajectory. Instead, this gives real estate investors a reason to raise prices every once and then as the year progresses. There is absolutely no way a city of this status will have its real estate market fighting for life. The real estate market goes hand in hand with the status of the city. All of these explain why real estate prices are going up in 2022 here in Calgary. That is also the trend when it comes to townhomes in Calgary.
- The economy
The economy of a given place plays a great role in the state of various issues that affect day to day lives of the residents. Growth of the economy is something nice but at times it can mean hard situations to those who have not planned themselves well. A town or city with a high economy will tend to have a high standard of life. A high standard of living means that various services and commodities will cost highly to an extent that if you were to come from another city or town to live in that place, you would witness or realize a very big difference as far as prices of services and commodities are concerned. Prices of houses too are always not left behind when the economy is on the rise. A high economy simply means high prices in the real estate sector. It is assumed that if people can be able to afford other necessities which might cost highly because of a high economy, they can also be able to afford houses that cost high prices as well. Generally, as times change, the real estate prices are also expected to shoot. 2022 still presents to buyers and investors high real estate prices in Calgary. The economy of Calgary being strong prompts the prices of investment properties to keep going up. The economy of this city is boosted by financial services, energy, film and television, manufacturing, technology, aerospace, retail, transportation and logistics, health and wellness, and tourism sectors. All these factors greatly contribute to the improvement of the economy. The economy of Calgary is in a better state to immensely influence the prices of real estate properties. Prices of condos in Calgary are also rising. Calgary had positive economic growth in 2021 and the same is being witnessed in 2022. This year is proving to be a good year as far as the economy of Calgary is concerned. There has been a growth in population and jobs as well despite the sharp increase in the cost of living. When jobs are available, it means more people will have jobs and most likely they will be paid more. This will in turn promote the increase in prices of houses whether commercial or residential.
- Available amenities
The availability of amenities can be a game-changer as far as living life is concerned. Amenities, be it social or recreational will always attract people to a particular place whether to live or invest. Real estate properties located in areas with adequate and better amenities will always have high prices. The prices are also prone to increase as time goes by because many people will be attracted to that particular area because of the available amenities. Everyone always wants to have good taste and that is why no one can hesitate in moving to a place that has plenty of amenities. When it comes to matters of amenities, Calgary has more than enough. Talking of social amenities, Calgary has a good number of schools and hospitals that are very useful to the residents. A total of 245 schools are found in this area. Examples of these schools are Crescent Heights High School, Buchanan School, Sunnyside School, Calgary French & International School, Western Canada High School, The School of Calgary, and Chaparral School. These are just a few examples of what is available as far as schools are concerned. On the other hand, hospitals are also available and in a good state. Examples of these hospitals are Foothills Medical Centre, Alberta Children’s Hospital, and Rockyview General Hospital. The availability of these social amenities alone can trigger an increase in real estate prices because these are among the factors that usually make people move to a particular area or even want to pay more for properties. When people are willing to pay more, prices will definitely go up with time. A lot of recreation amenities are also available in Calgary. There are skate parks, athletic parks, golf courses, arenas, and art centres. They also play a role in the growth of the city and possibly increase real estate prices. Examples of these recreation amenities are as follows: Glenbow Museum, Calgary Zoo, Winsport, Fort Calgary, Calaway Park, Fish Creek Provincial Park, Heritage Park, Nose Hill Park, The Military Museums, Peace Bridge, Devonian Gardens, Edworthy Park, Contemporary Calgary, Bowmont Park, Carburn Park, North Glenmore Park, Confederation Park, Wonderland Sculpture, and Bowness Park. These mentioned ones are not all but just a few. You can see for yourself how this beautiful city is endowed with recreation amenities. All the mentioned amenities starting with schools and hospitals are still there and offer the best services hence making this city stand out from the rest. This is therefore what makes the prices of real estate keep going up in 2022. If you used to underrate the power of amenities now you can no reason to continue doing so because you can clearly see for yourself how they influence the real estate market.
- Demographics
Demographics refers to the quantifiable characteristics of a given population. These characteristics can be age, race, and even income. Demographics usually have an impact on the real estate market. Talking of population, Calgary has a population of over 1.3 million people out of which the majority are white followed by visible minority groups and then aboriginal. It is the third-largest city in Canada, the largest in Alberta province, and the 20th largest city in North America. The demographics of the working-age population usually have a significant impact on the changes in housing prices. The employment rate in Calgary is above 65% which means that most of the people are employed and earn income every month. The majority of Calgary’s population is above the national median income. This means that most of the people in this city are doing somehow good financially. When it comes to age, Calgary is a young city that has a median age standing at about 38 years. Most of Calgary’s population consists of people who are married and have families. This young population together with the majority who are married triggers high demand for housing because they need houses to establish themselves and also settle with their families. Because this population is still the same way in 2022, demand will continue going up hence the real estate prices will also continue going up.
- Infrastructure development
Infrastructure is a very fundamental aspect in the growth of a town or city and also affects various industries in that particular area. So this means that every town or city has to get it right when it comes to infrastructure because it means more than a lot. For instance, the availability of good roads determines how people move and settle in a particular area. When people move to a particular area they will create demand for housing which will eventually increase competition in the market hence high prices can be witnessed. If you construct roads and railway lines the impact will be felt in the real estate market. Talking of infrastructure development, Calgary has a large transportation network that adequately caters to the needs of its residents. There is a variety of road, rail, air, public transit as well as pedestrian infrastructure. This city is a major Canadian transportation center as well as a central cargo hub for freight in and out of northwestern North America. This speaks a lot about the status of transport in this city. It clearly depicts how this city is far developed when it comes to matters of infrastructure. The city itself is located at the junction between the Canamex highway system and the Trans-Canada Highway. This is indeed a very strategic position that allows the growth of not only the transport system but also the real estate industry. Real Estate does well where there is connectivity as far as roads are concerned because of the attraction the roads bring. Many people will always want to be at a place where they can access other different points with ease and this, therefore, means that good roads must be in place. When more people start settling in an area that has a good transport network that is how the demand for housing will go up and eventually make the prices of real estate properties also go up. Calgary has the second-highest light rail system in the whole of North America. This light rail transit system consists of 58.5 kilometers of track that connects various stations. Calgary has everything you can wish to see when it comes to infrastructure or transport networks. If you thought air transport is not available in this city then the Calgary International Airport is here to prove you wrong. Real estate will therefore thrive in such an environment and that is how you see prices still going up in 2022. Condos in Calgary are also experiencing the same.
- Zoning laws
In any particular place, zoning laws always carry a lot of weight as far as investments and other factors of the economy are concerned. As long as you are within a particular municipality, you cannot just start investing in a land without taking some things into consideration especially when it comes to matters of investment in the real estate industry or market. The most common is the zoning laws. Zoning laws can be well understood if you compare the time now and some time back maybe several years ago. Some time back, more of the land around commercial centres was being used for agricultural purposes and this made the commercial centres have less land for development. As you know, agriculture does not yield as much compared to real estate. The agricultural lands would therefore cost less because they do not have more commercial value. The change in the zoning laws has allowed these vast agricultural lands to be used for commercial and residential purposes. By doing this, the value of land increases automatically. The land is part of real estate and as more land is being put into commercial use, the prices go up and up because the benefits that will come along with that land are enormous. You can invest your money in this kind of land and you will be able to squeeze profits out of it. Also, houses built on these expensive lands will definitely cost high because the developer will be seeking to recover the money used on both buying the land and developing the property. In Calgary, you need to have a development permit before you can put up your structure on a given piece of land. The municipality management of Calgary has no problem with issuing developers development permits therefore this encourages more developers to want to invest. The more they invest in the real estate industry the more people will be attracted to moving into this city and eventually prices will still go up because of the high demand. This is something that you will continue to see in 2022 even as you think of getting one of the detached homes in Calgary.
- General inflation
Generally, all forms of properties become expensive to develop each year. This is a result of the price of inputs like cement, steel, and even skilled labor increasing every year. In the long run, general inflation makes properties more expensive to a point that even some other people cannot even think of developing a single property. For instance, if the nominal price of the property is not increasing by 2% to 3% every year, it means that the homeowner is actually losing money in real terms. This is because the inflation is increasing whereas the price of the properties is not. It is common knowledge to know that whatever is put in a project as input must in most cases be reaped as output in plenty. This simply means that this inflation has a direct influence on the prices of real estate properties. If a developer buys construction materials at very high prices, this developer must recover their money and also get profit on top of it. Again if the cost of labor is high it means the total construction cost will be high hence the prices of houses will automatically be high because the developers will be looking forward to recovering their money and making a profit. Of course, that is the reason why they are in the real estate business. The price of inputs is always increasing not just in Calgary but also in other parts of the world because the dynamics of the production and market are always changing. Due to this change in price especially on the upward trajectory, investors have no options but to increase the prices of houses in order to cope with the situation. Also, an increase in the prices of other useful commodities and services can in a way make the prices of real estate properties increase year in and year out. As 2022 is going on, real estate prices in Calgary are increasing because of this reason. As you plan to get into this venture, be aware of the dynamics of the real estate market because this is what you will come across as you try to own that magnificent home or commercial property that you wish to have. So if you are serious about buying a property in Calgary this 2022, be prepared with a good amount of money because the market is changing really fast. Loading yourself with more money is what is therefore required of you before you set foot in the real estate market whether as a potential homeowner or an investor.
- Government policies
Government policies always have an effect on the real estate market. The policies control the pricing and demand of real estate properties in a way. Examples of these policies include deductions, tax credits, and subsidies. When these mechanisms are put in place by the government, the demand for real estate properties temporarily goes up, therefore, making the prices also go up at that time. The tax credits in Alberta province have an impact on real estate in Calgary and therefore as they continue to exist, prices of real estate properties will likely go up because when people are taxed less they tend to invest more. More investment means more people which in turn translates to high demand leading to an increase in prices. This is the scenario you will keep on seeing in 2022.
Conclusion
In summary, the reasons mentioned above have directly contributed to the rising real estate prices in Calgary, Canada. If you didn’t know now you have known. Their impact cannot be overlooked and so an increase in the prices must be witnessed. Every potential buyer or investor should be aware of this so that they can brace themselves for this kind of situation. If you are planning to secure a home any time soon, just know that this is what you will face so take note of it. The more you keep waiting the more the prices go up and you might find yourself not being in a position to buy a property simply because you will not be able to put up with the existing prices at that time. As they say, time is money, take advantage of this time and do what you have to do even if it means grabbing for yourself one of the beautiful townhomes in Calgary. Take action as quickly as possible and you will end up saving some coins for yourself. The ball is now in your court.