Derrick Penner, Vancouver Sun, May 17, 2006
Albertans love British Columbia's waterfront cabins, ski chalets and resort condominiums.
And with oil wealth filling their coffers, our neighbours went on a real estate shopping spree in 2005, snapping up 4,320 B.C. properties worth almost $1.2 billion, making them the biggest out-of-province influence on many markets.
The real estate research firm Landcor compiled the data on who is buying in B.C., and company president Rudy Nielsen found that Albertans purchased more than twice the amount of B.C. real estate than the next three out-of-province groups combined.
And Nielsen added that these aren't people relocating to B.C., they're buyers who remain residents of Alberta.
"They've got tonnes of cash, and B.C. is getting to be their playground," Nielsen said. "Albertans are driving up prices everywhere."
B.C. towns within what Nielsen refers to as the "golden circles" -- destinations that are a four-, six- or eight-hour drive from Calgary -- have always been popular.
The economic and demographic forecaster Urban Futures Institute compiled data showing that, by property value, Albertans owned some 46 per cent of all real estate in the Radium and Fairmont hotsprings region near Invermere in the Rockies.
And realtor Bob Cliffe, with Re/Max Shuswap Realty, said the area round Shuswap Lake has been an Alberta market since he got into the business in 1988, with Albertans accounting for some 60 per cent of the activity.
However, Nielsen said that with increasing numbers of direct flights between Alberta locations and B.C. destinations, such as the Comox Valley on Vancouver Island and Kamloops in the Interior, Albertans have come to view the entire province as their recreational backyard.
The real estate firm NIHO Land and Cattle Co. is another one of Nielsen's businesses, and he said Albertans make up about 30 per cent of his clients.
Recreational properties "usually touching water -- fresh water or oceanfront," are what his clients are looking for. "And they've got cash."
Sharleen Whiteside just launched an advertising website for waterfront property and found a similar response. Close to a third of the 801 unique visitors that visited the site, Waterfront West Real Estate, came from Alberta.
Claudia Lajeunesse, a realtor with Royal LePage Desert Oasis Realty in Osoyoos said the Alberta segment of their south Okanagan market has exploded in the last five years to now account for 60 per cent of all activity.
"It's driving [prices] up, definitely," Lajeunesse said.
Lajeunesse added that the Alberta buyers are not just wealthy professionals. Working-class buyers, people who have done well working in skilled trades, are also among her clients.
However, prices are on the upswing with even a dated home on coveted waterfront lot fetching $998,000 in one recent sale.
Property values around the Okanagan and Kootenays have also risen dramatically.
Paul Fabri, a Canada Mortgage and Housing Corp. analyst for the southern Interior, said the median price for a detached home in Kelowna has spiked 22 per cent to $354,450 in the last year. In Vernon the median price is up 26 per cent too $277,000.
Kamloops is still cheaper, but Fabri said its median house price is up by an even steeper 37-per-cent increase to $257,000. However, he added that it is difficult to attribute the price spikes to any one segment of buyers because demand in the overall market is so strong with builders having a difficult time keeping up with adding new supplies of housing.
Ian Mason, executive officer of the Kootenay Real Estate Board said average prices inside the village of Invermere spiked 26 per cent to $339,000 in the past year. Rural Invermere, however, shot up 48 per cent to $482,000.
"Certainly [Alberta buyers] are a piece [of the market]," Mason said. "[But] I wouldn't want to cast the blame on any one buyer group for current market conditions."
Mason added that the region in general are seeing large numbers of baby boomers cashing in their real estate gains in many other places to make a lifestyle jump to the Kootenays. Nelson saw its average prices rise 39 per cent to $316,000 within the last 12 months.
"We're subject to the global economic trends," Mason said. "British Columbia is healthy as well."
David Baxter, a forecaster for the Urban Futures Institute said the arrival of a big group of outside buyers in a market can breed resentment among locals who feel like they are being priced out of it.
It is also harder to build a strong sense of community in a place with large numbers of part time residents.
However, Baxter said there is also an upside. More well-heeled Alberta buyers inject a lot of new money into the economy, usually in higher-end luxury pursuits that help provide jobs. They also pay property taxes without demanding as many municipal services as permanent residents.
"There's no question [Alberta] is a significant market [for B.C. real estate] and it's going to continue to be a significant market."
BEAUTIFUL B.C. LAKEFRONTS INVITE ALBERTA BUYERS
Well-off Albertans love their lakefront property, especially if it's in B.C. Lake Osoyoos and Shuswap Lake, are among their favourites.
Top 4 out-of-province buyers of B.C. real estate, 2005
Washington state: $146,501,673