#multifamilyinvesting — Phoenix Real Estate

Calgary Market Update Spring 2022

May 12, 2022 by admin

Well despite the little snowstorm we had a week ago, spring looks like it may finally be here and the inventory is coming in with the warm weather.

Provincial health restrictions had been lifted and society is starting to get back out there into malls, retail, restaurants, and rental properties have picked up like crazy.

Not only do we help people buy, sell, invest in real estate we also are heavily involved in Calgary/area real estate investments including rental properties.

I have not seen this kind of rental demand in many years since back before the last correction in 2014 where there we bidding wars for rentals in Calgary! Indicators show we might be back there again soon if the vacancy rates and in-migration to Alberta continues at the current pace.

Single family home are the hot commodity at the moment with The detached benchmark price rose to $628,900 in April, which is 19 per cent higher than last year. Causing strong market conditions in this asset class.

All markets have picked up with the rising interest rate cost causing SOME buyers to re-think the total amount of mortgage they want to take on and buying smaller and different properties such as townhouses and condos.

Investment in Calgary real estate is now the target for a lot of out of town buyers from Expensive trophy markets such as Vancouver and Toronto where they have seen huge equity gains and they are looking for better ROI and cash flow which can still be found easily in Calgary by comparison. Why even bother with a 2% cap rate in Vancouver/Toronto for a dog house built in 1939?!? Crazy that non-developers will do these kind of things.

If you need help or have questions about the market or anything else in real estate Contact us today we are here to help!

To your success,

Tim Reid

-Respect the hustle

Want Cash Flowing Real Estate? Look to Alberta

August 25, 2021 by admin

It might seem like Alberta is a have-not province over the last few years with the energy sector down turn. When you look at other areas such as Toronto (the GTA – greater Toronto area) have seen gains in prices in areas soar as sales volume increases hit as high as 96% in central Toronto this is driving prices into almost un-rentable territory.

How can rent keep pace with that? Well quite simply it can’t not to support a mortgage with 80% Loan to value, forcing investors who want to operate in that market to put huge down payments equal or greater than commercial rates.

This has forced investors to look further and further out to the suburbs to find rental properties to get decent returns on investment. When you consider multi-family cap rates so low it does not even out pace inflation, you are only land-banking in essence which is a speculative game.

Eventually there can be a shift in interest rates that would bury all those properties bought at those rates, forcing even more cash to go into those assets to prevent massively negative cashflows.

More investors are looking for better cap rates and better cash flow in other markets. Due to the energy sector taking a hit over the last few years we have seen downward pressure on pricing in Alberta overall, but only a small downward pressure on rents.

Since there have been harsh rent controls in Ontario and BC these markets also have those forces working against rental property investors. Alberta has seen rental rate gains back to normalized rates at or above pre-covid19 levels

What this means for investors is that we have the opportunity for massive upside in appreciation, and also an older value-add potential for many older assets that have been allowed to accumulate deferred maintenance for years in Alberta.

Have you thought about rental property in other markets?

If you are considering Alberta locally or from abroad in Canada contact our team to book a discovery call, we are here to help with access to private deals/Vendor financing opportunities just to name a few!

To your success,

Tim Reid

-Respect The Hustle