Edmonton Real Estate Investor: where to invest in Canada and why

I saw a report the other day that a UK company recommended Toronto, Vancouver and Calgary as the best places to invest in Canada. Well, one out of three isn't bad....

You may remember what $890k can buy in Vancouver. How are you going to cashflow with that property? You're mortgage payments are about $3320.00 so you have to rent that property out for about $3800 to cover tax, repairs, property management fees. I don't know about you but I have yet to find a tenant willing to spend $4000 to live in a hovel.

So with all the noise about investing where to do it, who to do it with even when to do it. You need to just remember the basics. For me the most important thing is why I invest. You could throw water on my face at 3am and it's quite likely I would shout out the answer word for word. That's my commitment.

Here are some reasons from Peter Kinch ( who I reblog a LOT) :

Here's the bottom line for all investors:

There are a lot of headlines this week trumpeting the downward slide of the stock market – All this while the head of Scotia Bank reminds us that reports of a ‘Housing Bubble’ are over-rated.
*If you are looking to invest over the long term, then don’t get too worried about the day to day fluctuations of the market – whether that’s in real estate or the stock market.

*If you’re looking for steady cash flow and long-term stability from your investment – then focus on the economic fundamentals of where you are buying and key in on having a solid tenant base.

In the meantime, here’s what’s ‘In the News’….

A new report suggests that Canadian homeowners are paying down their mortgages faster than they’re being given credit for.

Click here for full details from MoneySense.

Canadian concerns about a housing bubble are overblown in a country where credit growth is modest and the job market is stable, says Bank of Nova Scotia CEO Brian Porter.

Click here for the full Bloomberg article.

Bank of Canada Governor Stephen Poloz is signaling that it’s time to take off the training wheels – that the central bank will no longer be there to hold the market’s hand.

Click here for more from Business in Canada.

Do you have a mortgage that is coming up for renewal? Are you thinking of buying an investment property? Do you know someone who is buying a new principal residence and would benefit from a lower mortgage rate?

Now is the best time to get our expertise working for you. You can get a great rate and expert advice at the same time.

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Thank you Peter!

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In the Olympics of investing Alberta is still the gold medalist. The province got a score of 8.5 out of 10 in The Provincial Investment Climate Index.

This index has seven main components: corporate income tax, fiscal prudence, personal income tax, transportation infrastructure, corporate capital tax, labour market regulation, and burden of regulation.
"Alberta came in first place on most indicators including corporate income taxes, corporate capital taxes, personal income taxes, fiscal prudence, and labour-market regulation. However, Alberta ranked seventh on transportation infrastructure, which assesses highways, urban transit, air, rail, and marine service."

The article states that Alberta is losing ground to other provinces. Saskatchewan comes in at 6.6 and British Columbia at 6. Those two provinces saw a year over year increase of 0.7 and 0.2 certainly they are improving but still no where near Alberta's stellar 8.5 performance.

Read more here

Somewhere between 2013 and 2015 oilsands production is set to double. Increased demand in the U.S due to the decrease in oil supply from Venezuela and Mexico make Canada's oil not only desirable but the natural choice.

The first $2Billion dollar pipeline was approved last week and many many more are coming. So what does this have to do with real estate?

At the peak of the mini-boom in 2007 Alberta oil companies couldn't find enough people to work in the tar sands now with plans to double the work force will have to increase as well.

Edmonton as the closest major city to the oil sands (with reasonable housing prices) is going to attract a lot of renters and potential buyers over the next 2 to 5 to 15 years. How does that make anyone money? By either owning the properties for sale or rent.

Don't forget -

During the gold rush entrepreneurs who filled a need serving those who panned for gold made most of the profits. Alberta is in a modern day gold rush and the strongest demand in this province is housing. Areas that are “hubs” are those that are seeing the highest increases in housing values. Edmonton’s strategic location between the multi-billion dollar Alberta Oil Sands projects in Northern Alberta and Calgary, make it the center of all the action.

So would you rather pan for gold or sell the pan, shovel and tent to the worker?

$2 billion investment in Alberta oilsands - A Chinese energy giant is making a nearly $2-billion investment in the Canadian oilsands. Athabasca Oil Sands Corp. says PetroChina is buying a 60 per cent working interest in its Mackay River and Dover oilsands projects in northeastern Alberta.

Although Canada's economy is tied to the U.S our oilsands are bringing interest from around the world. It is a valuable safe source of oil.

New online service makes home buying smarter, swifter for Canadians - Zoocasa.com -- a recently launched online site promises to make searching for a new home an exhilarating and productive experience for Canadians. Zoocasa offers a wealth of "neighbourhood information" for its more than 100,000 home listings.

Sounds interesting!

Location Selected For Alberta Nuclear Plant - According to a report by the CanWest News Service, Energy Alberta Corp. has said that it has formally requested permission from the Canadian Nuclear Safety Commission to construct a pair of twin-unit Candu reactors about 500 kilometres northwest of Edmonton.

"Building a nuclear power facility is a long and rigorous process. This is the beginning of a public and regulatory process that will include environmental, health and safety assessments," said Wayne Henuset, Energy Alberta's president and co-chairman, who termed the application a "historic moment" for the province's nuclear power industry.

Hopefully this will help reduce our greenhouse emmissons.

The emerging energy superpower - Canada's oil and gas industry is surviving the economic downturn. The boom times may be over, but stories of a bust are wide of the mark

AS A MEMBER of the G8, Canada is an anomaly: it is the only member of the rich nations' club that depends on a resource-based export industry to support its economy. Oil and gas are both central to this and Canada's energy sector increasingly influences the way it deals with the world. Prime minister Stephen Harper calls his country an "energy superpower". Notwithstanding the temporary slowdown in the US economy, Americans increasingly depend on imports of Canadian energy to support their lifestyle.

And, like much of the rest of the world, Canada depends on the US: its consumers almost monopolise Canadian energy exports and the political decisions made in Washington – like whether to adopt a cap-and-trade system to fight carbon emissions – will shape the Canadian energy industry and politics

"We are proud to be pioneers in bringing the benefits of clean, safe, reliable nuclear power to Alberta."

Canada is the economic leader in the G8 and Alberta is the leader in Canada, where else in the world should you put your investment money?

Alberta economy predicted to grow 3.3 per cent next year — "Alberta’s struggling economy will recover next year and grow 3.3 per cent, the Conference Board of Canada predicted Thursday.

Gross domestic product will contract 2.7 per cent in 2009 after a 0.2 per cent decline in 2008, the board said in its summer provincial outlook.

“Higher energy prices and lower construction costs should spur oil and gas activity, which will support a rebound in the domestic economy,” the report said.

Scotiabank also predicted that rebounding oil prices and falling inflationary pressures will bring a return to growth for Alberta in 2010, with GDP rising 2.8 per cent after a predicted 2.3 per cent contraction in the economy this year. The bank said the Canadian economy’s output will shrink 2.2 per cent in 2009 and grow 2.5 per cent in 2010."

By next year Alberta will be leading the nation out of the recession.