Real Estate

Calgary Real Estate Market - 2021 and beyond

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  • Nov 21st, 2022 8:44 pm
[OP]
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Mar 20, 2018
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Calgary Real Estate Market - 2021 and beyond

I am considering entering real estate market in Calgary and purchasing a single-family home [my first choice] / duplex / townhouse. I want to find a property with good investment characteristics (this is why broad consideration and three options). I plan to live in the property myself and maybe rent out a part of it.

I want to research and understand real estate market in Calgary.

I decided to focus on the following questions:
1) What constitutes desirable investment characteristics of a property in Calgary?
2) What characteristics make a property liquid (meaning I can sell it easily if I want to - I guess this relates to my first question)?
3) What are characteristics of a property to make it desirable from the standpoint of renting out a part of it (e.g., basement).
4) What are important rental regulations I should be aware of?
5) What are peculiarities of the Calgary market that significantly affect R/E pricing?

Looking for your input as well as resources which you think will help to answer my questions. I am based outside of Alberta, but spent a few weeks there in the beginning of the summer to get an idea what it is like to live in Calgary.
Last edited by stanleyinfrared on Jan 1st, 2022 5:48 pm, edited 1 time in total.
1233 replies
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Jan 13, 2014
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stanleyinfrared wrote: I am considering entering real estate market in Calgary and purchasing a single-family home [my first choice] / duplex / townhouse. I want to find a property with good investment characteristics (this is why broad consideration and three options). I plan to live in the property myself and maybe rent out a part of it.

I want to research and understand real estate market in Calgary.

I decided to focus on the following questions:
1) What constitutes desirable investment characteristics of a property in Calgary?
2) What characteristics make a property liquid (meaning I can sell it easily if I want to - I guess this relates to my first question)?
3) What are characteristics of a property to make it desirable from the standpoint of renting out a part of it (e.g., basement).
4) What are important rental regulations I should be aware of?
5) What are peculiarities of the Calgary market that significantly affect R/E pricing?

Looking for your input as well as resources which you think will help to answer my questions. I am based outside of Alberta, but spent a few weeks there in the beginning of the summer to get an idea what it is like to live in Calgary.
Thats lots of questions lol.

A desirable investment in calgary would be something that is lucrative to the buyers, such as a multiple rental stream (basement suite rental, garage suite etc).

the liquidity depends on the quadrant (SE, NE, NW and SW). for some its the inner structure of the house, curb appeal, options etc. Income stream is pretty important for areas like NE and some areas of NW and SE.

Calgary/Alberta has pretty much better rental platform than Ontario with rules favoring the landlords, than tenants.

The boom and bust cycle is what effects our economy the most. but having a legal cashflow generating second unit is better for salability.

PM me if youve have more questions.
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Nov 9, 2013
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stanleyinfrared wrote: I am considering entering real estate market in Calgary and purchasing a single-family home [my first choice] / duplex / townhouse. I want to find a property with good investment characteristics (this is why broad consideration and three options). I plan to live in the property myself and maybe rent out a part of it.

I want to research and understand real estate market in Calgary.

I decided to focus on the following questions:
1) What constitutes desirable investment characteristics of a property in Calgary?
2) What characteristics make a property liquid (meaning I can sell it easily if I want to - I guess this relates to my first question)?
3) What are characteristics of a property to make it desirable from the standpoint of renting out a part of it (e.g., basement).
4) What are important rental regulations I should be aware of?
5) What are peculiarities of the Calgary market that significantly affect R/E pricing?

Looking for your input as well as resources which you think will help to answer my questions. I am based outside of Alberta, but spent a few weeks there in the beginning of the summer to get an idea what it is like to live in Calgary.
1) It all depends on what you, and your renters, are after. What's your strategy? Who is your target renter? Long term buy and hold? Short term vacation rental? Student rental? Ultimately, as investors we are after a return. That return comes via cash flow and appreciation. Some properties appreciate faster than others, but some properties also provide more cash flow than others (i.e. vacation rentals, multifamily homes).

Also, what part of the city are you investing in? What are the anticipated rents, and what is the vacancy rate? If you’re leaning more towards condo or town home, what’s the supply like? Are there any developments soon to be completed that will greatly increase supply in your target area?

2) Probably the most liquid asset is a single family starter home - typically the market is stronger for this than a condo or town home (no strata fees, less supply overall) in a good area. You can talk to your agent and view sales trends in Calgary to get more of an idea about this.

3) Desirable to you? Or to a tenant? If you're looking for cash flow, then yes the more units on your property the more cash flow you get. However, if it's less desirable to a tenant you get more tenant turnover, have to accept lower quality tenants, and will probably end up with more headaches in dealing with tenant issues. Tenant turn over costs you money as well.

Also, be mindful that the more units you have on a property, the less liquid it can become as the target buyer is basically an investor. Ie would you buy a four plex for your home? Probably not. Would you buy a home with a basement suite to rent out? Possibly.

4) Google "legal secondary suite Calgary"

5) The oil boom / bust cycle significantly impacts R/E pricing in Alberta, although other areas (Edmonton) have a bit more diversity (i.e. more Government employees).
Keep calm and go long
[OP]
Member
Mar 20, 2018
261 posts
159 upvotes
masarwar wrote: Thats lots of questions lol.

A desirable investment in calgary would be something that is lucrative to the buyers, such as a multiple rental stream (basement suite rental, garage suite etc).

the liquidity depends on the quadrant (SE, NE, NW and SW). for some its the inner structure of the house, curb appeal, options etc. Income stream is pretty important for areas like NE and some areas of NW and SE.

Calgary/Alberta has pretty much better rental platform than Ontario with rules favoring the landlords, than tenants.

The boom and bust cycle is what effects our economy the most. but having a legal cashflow generating second unit is better for salability.

PM me if youve have more questions.
Thanks so much for your input. Many questions because I want to understand the market in Calgary in depth. Would it be correct to say that the following is the order in which quadrants are considered most desirable (most desirable first): NW, SW, SE, NE?
[OP]
Member
Mar 20, 2018
261 posts
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treva84 wrote: 1) It all depends on what you, and your renters, are after. What's your strategy? Who is your target renter? Long term buy and hold? Short term vacation rental? Student rental? Ultimately, as investors we are after a return. That return comes via cash flow and appreciation. Some properties appreciate faster than others, but some properties also provide more cash flow than others (i.e. vacation rentals, multifamily homes).

Also, what part of the city are you investing in? What are the anticipated rents, and what is the vacancy rate? If you’re leaning more towards condo or town home, what’s the supply like? Are there any developments soon to be completed that will greatly increase supply in your target area?

2) Probably the most liquid asset is a single family starter home - typically the market is stronger for this than a condo or town home (no strata fees, less supply overall) in a good area. You can talk to your agent and view sales trends in Calgary to get more of an idea about this.

3) Desirable to you? Or to a tenant? If you're looking for cash flow, then yes the more units on your property the more cash flow you get. However, if it's less desirable to a tenant you get more tenant turnover, have to accept lower quality tenants, and will probably end up with more headaches in dealing with tenant issues. Tenant turn over costs you money as well.

Also, be mindful that the more units you have on a property, the less liquid it can become as the target buyer is basically an investor. Ie would you buy a four plex for your home? Probably not. Would you buy a home with a basement suite to rent out? Possibly.

4) Google "legal secondary suite Calgary"

5) The oil boom / bust cycle significantly impacts R/E pricing in Alberta, although other areas (Edmonton) have a bit more diversity (i.e. more Government employees).
Thanks for your reply. What is considered a starter detached home in Calgary (or major urban centers in Alberta taking into account your location)? In my understanding, a common starter home would a 3-bedroom 2-bathroom two-storey home or bungalow with a garage with floor space in the range 1500-2000 sq ft. Is this about right?
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Nov 9, 2013
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stanleyinfrared wrote: Thanks for your reply. What is considered a starter detached home in Calgary (or major urban centers in Alberta taking into account your location)? In my understanding, a common starter home would a 3-bedroom 2-bathroom two-storey home or bungalow with a garage with floor space in the range 1500-2000 sq ft. Is this about right?
I would largely agree, although depending on the area, older homes in more mature areas may be smaller (i.e. 1000 - 1500 sf) +/- garage.
Keep calm and go long
[OP]
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Mar 20, 2018
261 posts
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@treva84 I also noticed that some detached homes comes with HOA fees. This is definitely new to me as it doesn't exist in Ontario. How common is that?
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stanleyinfrared wrote: @treva84 I also noticed that some detached homes comes with HOA fees. This is definitely new to me as it doesn't exist in Ontario. How common is that?
I can't give you a % but I'd say pretty common, especially in newer areas. For example in Edmonton I have to pay a HOA fee (it's like $100 a year, so minimal) just so my HOA can maintain some landscaping and snow removal around parks and paved paths. Whenever we get a community centre the $$ will go up.
Keep calm and go long
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Jan 13, 2014
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stanleyinfrared wrote: Thanks so much for your input. Many questions because I want to understand the market in Calgary in depth. Would it be correct to say that the following is the order in which quadrants are considered most desirable (most desirable first): NW, SW, SE, NE?
This isn't correct. You can find whatever you're looking for in each of these quadrant. NE tends to have better rental return.
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Nov 9, 2013
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There's a website called Urban Analytics and it'll give you reports about vacancy rates and rental rates for different parts of the city.

I pulled this one for Calgary (Q2 2021) - it would give you an idea of what it's like in different sub markets. Hopefully the PDF link works -

https://urbananalytics.ca/sites/default ... l_Take.pdf

If interested, here's Edmonton for Q2 -

https://urbananalytics.ca/sites/default ... _Take..pdf
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Sep 19, 2004
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stanleyinfrared wrote: Thanks so much for your input. Many questions because I want to understand the market in Calgary in depth. Would it be correct to say that the following is the order in which quadrants are considered most desirable (most desirable first): NW, SW, SE, NE?
I am curious on this question also as I've heard NW is better (not sure why), for housing/family. not as Rental owner

Are there RFD's take on this topic also, and why?
I've read some feedback on it's b/c of "race/people" which I get. I guess like GTA, there's Brampton, Markham/North York, etc...
Thanks in advance
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Nov 9, 2013
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jerryhung wrote: I am curious on this question also as I've heard NW is better (not sure why), for housing/family. not as Rental owner

Are there RFD's take on this topic also, and why?
I've read some feedback on it's b/c of "race/people" which I get. I guess like GTA, there's Brampton, Markham/North York, etc...
Thanks in advance
I think the CREB source cited highest home prices are in that area - maybe it’s just higher SES which people believe as more desirable?
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stanleyinfrared wrote: @treva84 I also noticed that some detached homes comes with HOA fees. This is definitely new to me as it doesn't exist in Ontario. How common is that?
They are everywhere in ontario especially new ones.
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Jul 29, 2004
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it's not uncommon in calgary as most communities will have amenities that are available for use only to the specific residents.

for example: a community centre, lake/beach (man made), tennis/basketball courts, etc. the fees pay for maintaining/landscaping of these common areas

i think all the neighbourhoods in deep SE calgary are like this (auburn bay, mahogany, copperfield, mckenzie towne, cranston, etc.)

the demographic of this part of calgary is majority new/young families.
advantage is affordable housing with lots of new schools/homes built in the last 5 years (with more continuing to come).
disadvantage is that it's far from the downtown core (transit options suck) and might be 'boring' for the young adult crowd.
Last edited by JayWang on Aug 21st, 2021 9:08 pm, edited 3 times in total.
[OP]
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Mar 20, 2018
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JayWang wrote: it's not uncommon in calgary as most communities will have amenities that are available for use only to the specific residents.

for example: a community centre, lake/beach (man made), tennis/basketball courts, etc. and in some cases, this fee would also cover some common areas landscaping. this is what the fees pay for.

i think all the neighbourhoods in deep SE calgary are like this (auburn bay, mahogany, copperfield, mckenzie towne, cranston, etc.)
Thanks for your input. I am in Ontario at present and wasn't aware of this concept.
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Feb 27, 2013
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stanleyinfrared wrote: Thanks so much for your input. Many questions because I want to understand the market in Calgary in depth. Would it be correct to say that the following is the order in which quadrants are considered most desirable (most desirable first): NW, SW, SE, NE?
SW > NW > SE > NE, some NW peeps might take offence to this but, most Calgarians would agree with this IMO. That being said, that being said the deep burbs in the NW and better than those in the SW and SE.

Re: your original post I'd be very cautious about townhomes and duplexes, multifamily is super saturated in Calgary and basically the only market not up y/y, going to see a ton of purpose built rental coming to market as well. Spend some time looking at the number of new builds coming to market and the types, should give you some fear about the multi-residential market. Most of my friends/colleagues who bought this segment within the last 5 years are 15-20% upside down on equity, meanwhile I'm north of 20% on the detached side, a common trend overall.

Urban sprawl is an ongoing issue, too many new communities in deep suburbia, not bullish on many of these communities as an investment but certainly good enough value for a first home for most. Demand is still "inner city", a loose term, as everyone has a different cutoff point. Taking half a day and doing a drive around can be very educational experience, inner city is very much large houses, infills and top to bottom flippers, once you're driving and you find yourself in a community that is still a lot or 50s-70s homes and a lot of ongoing renos, you're probably in a good spot for an investment property that will appreciate, don't expect to bank much equity deep in the burbs.

Another thing to be aware of is just being on the better side of the street, for example once you're east of Macleod expect a drop in property values, same with east of Elbow. Just a couple examples, but generally more western is favored.

Not sure what you time horizon is, but if it's 5-10 years also consider the new green line and how TOD will breathe new life into some communities.

Can weigh-in some more, but those are just a few thoughts off the top of my head.
~Let your actions reflect your desires
[OP]
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Mar 20, 2018
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hameljon wrote: SW > NW > SE > NE, some NW peeps might take offence to this but, most Calgarians would agree with this IMO. That being said, that being said the deep burbs in the NW and better than those in the SW and SE.

Re: your original post I'd be very cautious about townhomes and duplexes, multifamily is super saturated in Calgary and basically the only market not up y/y, going to see a ton of purpose built rental coming to market as well. Spend some time looking at the number of new builds coming to market and the types, should give you some fear about the multi-residential market. Most of my friends/colleagues who bought this segment within the last 5 years are 15-20% upside down on equity, meanwhile I'm north of 20% on the detached side, a common trend overall.

Urban sprawl is an ongoing issue, too many new communities in deep suburbia, not bullish on many of these communities as an investment but certainly good enough value for a first home for most. Demand is still "inner city", a loose term, as everyone has a different cutoff point. Taking half a day and doing a drive around can be very educational experience, inner city is very much large houses, infills and top to bottom flippers, once you're driving and you find yourself in a community that is still a lot or 50s-70s homes and a lot of ongoing renos, you're probably in a good spot for an investment property that will appreciate, don't expect to bank much equity deep in the burbs.

Another thing to be aware of is just being on the better side of the street, for example once you're east of Macleod expect a drop in property values, same with east of Elbow. Just a couple examples, but generally more western is favored.

Not sure what you time horizon is, but if it's 5-10 years also consider the new green line and how TOD will breathe new life into some communities.

Can weigh-in some more, but those are just a few thoughts off the top of my head.
Thanks for your contribution. How would you define "inner city" and can you give a few examples of neighbourhoods in there? I did spend a few days driving around Calgary and my feel was the same as your opinion: I liked communities in SW the most. For example, Signal Hill up to Strathcona Park. Other communities that stand out and I remembered are Pump Hill, Paliser, Tuscany. I did not cover all the places I wanted to due to lack of time, though.

What do you think are the best neighbourhoods with respect to the value you get for your money in your opinion? Looking for quick access on major highways, close to amenities and CT, with quick access to downtown (less than 30 min).

Are there any neighbourhoods that are overlooked just because they are located in areas that are less desirable (e.g. South /North East, North) but are decent? I heard that Bowness, Forest Lawn and Ogden fit into this category. Your thoughts?

What communities do you think will benefit from the Green Line?
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stanleyinfrared wrote: What communities do you think will benefit from the Green Line?
the green line is being built in stages with the first stage building a good chunk of the SE portion and a very small NE portion.
the entire system fully developed is probably 20-30 years away

the proposed map can be found here:
https://www.calgary.ca/content/dam/www/ ... vision.pdf

interactive map:
https://www.calgary.ca/transportation/g ... e-map.html
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stanleyinfrared wrote: Thanks for your contribution. How would you define "inner city" and can you give a few examples of neighbourhoods in there? I did spend a few days driving around Calgary and my feel was the same as your opinion: I liked communities in SW the most. For example, Signal Hill up to Strathcona Park. Other communities that stand out and I remembered are Pump Hill, Paliser, Tuscany. I did not cover all the places I wanted to due to lack of time, though.

What do you think are the best neighbourhoods with respect to the value you get for your money in your opinion? Looking for quick access on major highways, close to amenities and CT, with quick access to downtown (less than 30 min).

Are there any neighbourhoods that are overlooked just because they are located in areas that are less desirable (e.g. South /North East, North) but are decent? I heard that Bowness, Forest Lawn and Ogden fit into this category. Your thoughts?

What communities do you think will benefit from the Green Line?
Rather than trying to define inner city I'll give some communities that I feel are kind of the next wave of renos.
  • SW - I would say try and stay north of Southland, so Palliser, Chinook Park, Haysboro, Kingsland. Depending on budget maybe Pump Hill or Kelvin Grove, but those are less value plays and on the pricier side.

    Options further north and more west I would say: North Glenmore, Lakeview (I'd be cautious on this one, it's not for everyone given how cut-off it is), Glamorgan (more of a renters community, so it detracts a bit, but some value plays here), Tri-glen area: Glendale, Glengarry and Glenbrook, Signal Hill, Sienna Hills, Westgate. North of 17th, South of 16th and West of Sarcee there's some good stuff as well, but you'll notice it shifts more to that Palliser vibe.
  • SE - Same as above, north of Southland, so Fairview, Acadia, Riverbend. Riverbend has been hot lately among first buyers as a quarry park proxy and stands to benefit from the green line when South Hill is developed. To your question on Ogden, I would agree to a lesser extent, higher degree of vagrancies and a lower income demographic, again it's kind of being on the right side of the road, and in this case SE from Glenmore to 16th is a noticeable shift. Lynnwood (also a green line stop) is shifting a bit quicker than Ogden IMO. Forest Lawn has been turning around a bit and also got a nice lift from the East Hills development, Radisson Heights and Southview are shifting a bit quicker than Forest Lawn as they're more westward. Just keep in-mind that Glenmore to 16th area is going to likely have higher vagrancies and lower income demographic for quite some time, 5-10+ years would be my best guess, but these are great areas for first time buyers.

    I would also say Douglas Dale and Douglas Glen are worth a look, nice lift from Quarry Park. Just be cautious on proximity to Deerfoot for these communities as road noise plays in.
  • NE - There's a small pocket that's fairly desirable due to DT proximity: Bridgeland, Renfrew, Mayland Heights. Renfrew might get a slight lift from Greenline.
  • NW - I find this the hardest to dissect, there's a ton of opportunities throughout almost. Some stand-outs IMO are: Highland Park (greenline), Highwood (greenline), Rosemont (for next wave of infills after Mt. Pleasant), Edgemont, Dalhousie, Varsity is pretty tried and true but getting harder to find value plays. Bowness is another good one that you pointed-out.
One other thing I'll add, look up school ratings. For SW and NW in particular I find this weighs in, immigrant families especially will target communities that have a highly rated designated school.
~Let your actions reflect your desires

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