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Record-high rents not enough to woo property investors

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Guest | 19 Jun 2012, 07:08 PM Agree 0

The Canadian Mortgage and Housing Corporation’s most recent figures show Estevan, in the heart of Saskatchewan’s oil patch, has the most expensive rent in the province at $1,104 for a two bedroom suit. It’s not much lower than Calgary’s $1,113 average.
Estevan-based Supreme Oilfield Construction has three employees living in trailers behind the building and another man living out of his car in the parking lot due to difficulties finding accommodation, says spokeswoman Diana Insley.
“They pounce on anything that’s ever listed, but by the time they get there another six people have already applied for it,” Insley says.Estevan Chamber of Commerce executive director Michele Cyrenne says with a vacancy rate near zero and more than 1,200 unfilled jobs there’s a hefty imbalance.
Cyrenne and colleagues are trying to work with developers to find out why no one is building rental properties.
The lack of development seems out of step with a city now leading the province in housing development. Still, interest on the part of investors, big and small, simply isn’t there, says Cyrenne.
“The fact is that wages in the Estevan area are quite high too,” says the chamber head.
One reason for the investor reluctance may be the income gap between oil workers and those who provide them services. It means that, without subsidies to build, an investor may be largely dependent on winning those oildfield workers.
Radio station employee Cara Herperger recently moved and has had little success finding a place to live. She was even told by one landlord that she wasn’t a good candidate because they had a preference for men working in the oil patch.
  • George jackson | 23 Jun 2012, 05:05 PM Agree 0
    as an x landlord . I whould not invest my money in property where I am at the mercey of the tenent as a resoult of the land lord tennancy act which in my opinion leans far to heavely on the tenants side . axample I cannot keep the damage deposit in the avent that attenant breaches his aggreament an leaves rent unpaid . In some cases for example where a town has incorperated cost of doing buisness ,taxes ect can increase far more than the tennancy act will allow one to increase rent . I owne property where the taxes have increased over 100% in the last 5 years , a large short fall from 15% I was allowed to raise the rent
  • Matthew Tynan | 25 Jun 2012, 07:25 PM Agree 0
    As a seasoned investor, I was intrigued when a film shoot I was working on had us (the crew) staying - not far from the oil & gas fields in a town called Sylvan Lake / Alberta.

    As I got to know the some of the drillers, supervisors and medical staff on the rig, it soon became apparent that yes, there is a shortage of accommodation in towns close by. And yes, some people have been known to sleep in their cars.

    Here are the Facts:
    Typically, the rig owners supply accommodation costs to each rig member to the tune of $180 per day plus what ever they earn -$1,200 plus a day.

    Almost all workers stay in Hotels with facilities.

    *These guys work 12 hour shifts / sometimes back to back.
    The work is very hard and extremely dangerous.
    When they get their time off, they don't hang around. They leave the area -travelling back to their families all over Canada.

    There is a shortage in accommodation, but it's those who are working in the supply industries who are looking and not so much the rig people.

    Seems that every one of these rig workers drives a large pick-up truck, owns a Harley and or a speed boat.
    They have plenty of money and often own -not rent.

    I would not get caught up in this so called boom, unless you know the area.
  • ken | 28 Jun 2012, 04:07 AM Agree 0
    I would think that generally the people who work in the oil fields and related work, would not normally have the inclination/time to keep their abode in good condition. This is not to say that they will be naturally destructive, but I think they will not exercise the same degree of care as a normal city dweller would. Cost for upkeep of the accommodation and various other expenses may therefore be quite high. Would the net income then be attractive enough?
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