As Ontario’s sizzling real estate market puts home ownership out of reach for many Canadians, a growing number of potential buyers are looking west in hopes of realizing their white-fence dreams.
Like newlyweds Vineet Mrug and Kushbu Mistry, who moved to Calgary from their hometown of Toronto last year, some residents of the GTA and other hot markets in Ontario are moving to Alberta for what they believe to be their last opportunity to own affordable real estate. in a major Canadian city.
“We had the idea (to stay in Toronto), but it was very short-lived, just because of house prices,” Mrug said, adding that he and his wife moved with the intention of founding a family soon.
“In Ontario, especially Toronto, within our budget, we were limited to a two-bedroom condo. And that really wouldn’t have been enough for us, with the kind of plans we had.”
Mrug and Mistry eventually purchased a 250 square meter house with a walk-out basement and a large backyard in Calgary’s northwest neighborhood of Valley Ridge.
“We got three times the amount of the house for the same amount of money,” Mrug said. “We are very happy with our decision.”
Mrug and Mistry’s experience is not unique. A quick perusal of housing-related forums on online outlets like Reddit reveals dozens of recent queries from GTA residents regarding weather, commute times, and popular neighborhoods in Alberta cities, particularly Calgary.
Estate agents in the Western Province are also buzzing with anecdotes about what they say is an unusually high number of inquiries from Ontario. These stories appear to be supported by Statistics Canada data, which indicates that Alberta led the country in interprovincial migration in the fourth quarter of 2021, for the first time since 2015. On a net basis, the majority of new migrants Alberta’s fourth quarter interprovincial came from Ontario.
“We’re starting to see this migration based on affordability,” said Don Kottick, president and CEO of Sotheby’s International Realty Canada. “I think we see part of that driven by the old FOMO, the fear of missing out. People are going to look where you can still afford a home.”
Calgary’s benchmark single-detached home price reached $620,500 in March, more than $73,000 above December levels and 20% above levels recorded a year ago. Many homes receive multiple offers and sell above the asking price.
On the high end of the market, the increase in activity is even more spectacular. Sales of detached and attached homes in the $1 million-plus price category in Calgary are up 71% and 258% year-over-year, respectively, according to Sotheby’s.
But even as home prices in Calgary rise, they pale in comparison to what would-be buyers face in other parts of the country. In Toronto, the average sale price in March 2022 was $1.3 million, according to the Canadian Real Estate Association, while the composite benchmark price in Metro Vancouver for the same month was $1. .4 million dollars.
While the federal government pledged in its most recent budget to take action to calm Canada’s overheated housing market, for many first-time homebuyers, it’s too little, too late. Data analyst Ryan Sekulic – who worked in the UK – took a job with Calgary tech company Helcim last year after looking at opportunities in Toronto and Vancouver.
“None of the jobs I was looking for in Toronto or Vancouver paid enough to justify living in either city,” Sekulic said. “I finally wanted to own it, and I’ve bought one now…which would have been impossible there.”
Canada’s housing affordability crisis has coincided with Alberta’s recovery from years of recession due to falling oil prices, which may be another reason why eastern Canadians are turn west again. According to the Conference Board of Canada, Alberta is expected to lead the country in economic growth in 2022 and 2023 due to soaring commodity prices. The province is also striving to diversify its economy, with some success – Calgary and Edmonton have seen rapid growth in their local tech scenes.
Out-of-town buyers also seem to be drawn to Calgary’s proximity to the Rocky Mountains. Recreational properties in Alberta are now the most expensive in all of Canada, surpassing even British Columbia, according to a recent report by Royal LePage Realty. In Canmore, a popular mountain town 80 km west of Calgary, single-family home prices soared 33% year-over-year to $1.36 million.
While much of that demand is still being driven by western Canadians, local Royal LePage realtor Brad Hawker said a growing number of properties in Canmore are being purchased by Ontario retirees.
“They’re taking advantage of a (high-priced) market, leaving segments of Ontario and coming here for a combination of more affordable real estate and a different quality of life,” Hawker said, adding that he doesn’t not expect the threat. of rising interest rates to slow down this specific trend.
“Honestly, I don’t see that changing. A lot of these buyers are cash buyers,” Hawker said. “They don’t put a mortgage on the property anyway, so interest rates are irrelevant to them.”
This report from The Canadian Press was first published on April 20, 2022.