Investing in Edmonton During COVID-19: Is It a Good Idea?
Although 2020 started with piping hot local real estate markets across the country, the arrival of COVID-19 quickly cooled it down along with what was initially a burgeoning economy. However, as the world is currently grappling with vaccine distribution, there may be a light at the end of the tunnel. Even though social distancing guidelines are still in place, Canadians have more freedom to revisit their business gradually or pursue other goals that were temporarily paused because of the crisis.
Real estate investors are eager to dive back into the thick of things, primarily since prices have gone down. If you’re considering a new investment in the best West Edmonton neighbourhoods, here’s what you need to know about Edmonton’s real estate marketing with current COVID-19 conditions:
Edmonton’s Temporary Economic Downturn
Alberta’s economy is highly reliant on the energy sector’s activity, so when oil prices fell, it hit the province hard. While it had already been dealing with an economic downturn before COVID-19, the pandemic worsened the state of things, resulting in widespread unemployment.
Edmonton doesn’t rely on the energy sector as much as Calgary does, but it did lead to the loss of around 11,000 jobs, affecting the local housing market. There was an oversupply of available properties but not enough demand for them. Prices also fell drastically to encourage buyers. Still, with Edmonton’s many development projects, it continued to attract numerous millennials in search of a new home, along with foreign investors who found conditions more favourable than the more expensive properties in British Columbia. COVID-19 has caused prices to decline further, dropping approximately 4 percent from May 2019.
Markets on the Rebound
Luckily, the province is on track to recovery as more people are receiving their vaccine doses, and the lockdown measures are slowly being lifted. The economy has rekindled since industries began to open up again last May, which has significantly boosted consumer confidence, making the real estate market look more favourable.
Many homebuyers prefer new homes, although Edmonton’s neighbourhoods are full of older homes. Still, these properties enjoy multiple offers, ranging from $20,000 to $30,000 on top of the listed price. Many investors have begun to flip the city’s older homes, revamp them to make them look modern, and sell them.
COVID-19 has also seen many people downsize in properties. With more companies shifting to a remote work setup for the foreseeable future, people no longer had to stay in expensive cities, which meant they went back home. They also opted for smaller properties or condos, meaning more extensive and outdated properties began to proliferate in the market. This new development presents a golden opportunity for investors to grab a “fixer-upper” at a great price, update it, and sell it for a hefty profit. Ultimately, people can take advantage of Edmonton’s lower prices, especially if they are willing to put work into the properties and transform them into modern abodes fit for a homebuying millennial lifestyle.
The Canadian real estate industry has been bouncing back since lockdown measures have been lifted. Real investors now have a prime opportunity to expand their portfolio and take advantage of the current low prices, which are sure to spike back up. Ultimately, being an Edmonton home buyer will pay off, as there’s no better time to invest in the city than today.
Looking for more real estate tips for buyers and sellers? You’ve come to the right place at Everything Real Estate. We regularly publish great resources, ideas, and information on everything real estate for properties in Edmonton and surrounding areas. Get in touch with us today for all your questions about buying, selling, or investing in real estate in Canada!