How to select an out-performing market

Recent numbers revealed Calgary to be an “out-performing” market, fit to stand the real estate cycle and perpetually produce high ROI.  According to Derek Burleton, vice-president and deputy chief economist with TD Economics, “based on some of the key drivers of growth, Calgary ranks right up there at the top and that should stand the housing market (in) good stead. At least continue to drive above average price gains over the long run.”

But are price gains all there is to it? Tony Zucaro, Right At Home Realty Inc., Brokerage, believes that a savvy investor won’t choose an area based on price alone.

"To me, an “out-performing market” happens in neighbourhoods which have either not yet hit their peak or in neighbourhoods set to ‘take off’ during a rebirth,” he says.  “In addition, proximity to highly rated schools, churches/synagogues, landmarks, or new ‘positive’ slated developments in the area can have an impact on perceived value -- sparking buyer interest which can contribute to an out-performing market.”

While other established markets flounder in terms of affordability and resale price fluctuations, cities such as Calgary are particularly attractive to investors. But examining the micro-market, in addition to the overall performance of the macro-market, is also of importance, says Zucaro.

The provincial or city-wide average does not necessarily shape the returns you can expect from an investment property. Numbers and formulas play as big a part as getting out into the area and seeing for yourself, he adds.

“Ultimately, investors should be considering the factors they would look at for their own primary residence when looking at a residential investment. You want to pay attention to school zones, access to shopping, churches, transit etc. and have a look at the neighbourhood, too.”

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