The Top Reasons to Invest in Edmonton Real Estate

Historically, the Canadian real estate market has always been considered safe in terms of minimal investment risk and maximum long-term yields. However, some markets tend to be “safer” (i.e. more profitable) than others when it comes to increasing net worth, generating steady cash flow, building equity and hedging against inflation.

As one of the fastest-growing cities in Canada, Edmonton remains one of the country’s leading markets in terms of investment and development prospects. According to recent reports, Edmonton has also been ranked one of the top three most affordable cities across the nation, allowing it to remain an enticing destination for both home buyers and investors alike.

But that’s just the start.

Here are the top reasons why you should consider investing in Edmonton real estate:

1. Consistent Demand 

Despite any transitional ups and downs, Edmonton’s economy remains strong. Although heavily reliant on oil and gas, other sectors (healthcare, education, construction, etc.) continue to stabilize the market, despite any ebbs and flows in the energy industry.

Thanks to a mixed economy, demand for rentals in the capital region remains high. With 35% of Edmonton’s population alone relying on rental properties for housing, investment properties are guaranteed to attract various tenants at any time.

Note: Edmonton’s rental market also benefits from favourable rules and conditions, including a comprehensive Landlord and Tenant Act.

2. An Affordable Market 

Regardless of recurring annual growth in home prices across almost every Canadian market, Edmonton has been rated one of Canada’s most affordable housing markets. Prices remain well below the national average of $621,525, with Edmonton’s average home price coming in at $401,390.*

Even with lower purchase prices, however, rental rates in Edmonton remain relatively high based on a consistent demand for rental properties. Not only are these conditions ideal for first-time investors looking for an affordable property with high returns, but they’re also ideal for investors looking to offset negative or break-even cash flows in other markets.

3. Historically Low-Interest Rates 

Historically low-interest rates are yet another driving force behind Edmonton’s thriving real estate market. Affordable home prices and high demand combined with the Bank of Canada’s steady target rate of 0.25% have made real estate investment conditions beyond favourable.

For these reasons, real estate for fix and flip investors remains equally lucrative – with updated properties in high demand among first-time buyers and downsizers, also looking to take advantage of low-interest rates.

Check out: Why Now Is the Best Time to Buy an Edmonton Home and Take Advantage of the Lowest Mortgage Interest Rates in Decades

4. Opportunities For Multiple Income Streams 

As the fifth-largest city in Canada, Edmonton is growing at a rapid rate. This has spurred the need for attached and semi-detached home styles as a means of catering to working professionals, first-time buyers, growing families and even downsizers looking for an affordable property to call home.

As a result, apartment-style condos, townhomes, duplexes, triplexes and fourplexes remain in high demand among Edmonton buyers. This makes the market ideal for multi-family investments that allow investors to both reduce their risk while benefiting from multiple income streams.

5. Home Prices On the Rise 

Due to a supply shortage, recent statistics have shown a steady increase in Edmonton’s average home prices and buyer demand. While prices continue to remain highly affordable compared to other Canadian markets, average sale prices are up 13.4% from 2020 and are predicted to increase year over year. For investors looking to take advantage of current buyer’s market conditions (low interest rates and affordable home prices), now is the time to enter Edmonton’s thriving real estate investment market.

See our previous post: Edmonton Real Estate: Why Now is a GREAT Time to Buy a Home

6. Property Appreciation and Hedging 

Simply put, real estate investors make money mainly through property appreciation and rental income. Increasing rental rates and property values also provide a hedge against inflation as, unlike most goods and services, real estate reacts proportionately: as rental rates and property values rise, so too will your cash flow.

What does this mean for Edmonton real estate investors? In short, Edmonton’s expanding economy paired, high rental rates, healthy market conditions and increasing property values mentioned above make it the perfect market for maintaining higher capital values. 

Note: Choosing the right property in the right neighbourhood is crucial to securing a great investment with even greater appreciation potential. See our previous post: Four Critical Must-Haves For Choosing the Right Real Estate Investment Property for more information. 

7. Multiple Tax Benefits

Edmonton real estate investors are also entitled to numerous tax breaks and deductions come tax time. In the capital region, as well as the rest of Canada, investors can deduct any reasonable costs associated with owning, managing and operating a property, including:  

• Repairs and maintenance
• Depreciation 
• Property taxes
• Rental property insurance
• Legal fees
• Advertising costs
• Accounting expenses
• Travel expenses
• Etc.

8. Seasoned Real Estate Investment Experts 

Whether you’re a seasoned real estate investor or just getting started, Edmonton is home to some of the most skilled real estate investment REALTORS® around. Regardless of your level of experience, a qualified real estate investment agent will be able to:

• Provide the necessary expert advice needed to navigate the Edmonton market
• Zero-in on the best properties for your current and future investment goals
• Negotiate a better asking price
• Help you build your investment team by connecting you with other qualified professionals (brokers, lenders, lawyers, etc.)
• Remain a reliable source of guidance and advice
• And more

*Edmonton average home prices according to REALTORS® Association of Edmonton, June 2, 2021

For more information on investing in Edmonton real estate, reach out to us! We also invite you to visit our Real Estate Investing blog and/or download your FREE copy of our guide, How to Create Amazing Wealth: A Beginner’s Guide to Investing in Real Estate. This comprehensive guide will teach you everything you need to know about:  

• The Advantages of Investing in Real Estate
• Learning the Basics
• How to Find Your Real Estate Niche
• Preparing Your Finances
• Finding the Right Property in the Right Neighbourhood
• How to Secure Multiple Income Streams
• The Importance of Working With an Experienced Real Estate Investment REALTOR®
• And more!

Related:

• The Top Reasons Why Your First Home Should Also be an Investment Property
• The Benefits of Investing in a Rental Income Suite
• 9 First-Time Real Estate Investment Mistakes to Avoid

*Edmonton average home prices according to REALTORS® Association of Edmonton, June 2, 2021

Photo credits: shutterstock.com

Categorised in: Real Estate Investing

This post was written by Terry Paranych Real Estate Group