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Numbers put to rest fears Albertans are buying up B.C.

Gary Lamphier , The Edmonton Journal,  May 30, 2006

West Coast developers regularly target Alberta real estate buyers through splashy newspaper and TV ads as well as glitzy brochures.

There's no mystery why. Thousands of Albertans dream of retiring one day to the mild climes of places like Victoria, Kelowna or Parksville. And with Alberta's economy booming, many have the bucks to do so.

In particular areas of B.C. -- notably the Okanagan, the Salmon Arm area near Shuswap Lake, and the Kootenays -- Alberta buyers exert a big influence on the local market. Many pay for their properties in cash.

But it's also clear that Albertans are not the primary drivers behind B.C.'s lofty real estate prices -- despite recent headlines to the contrary.

Based on data compiled by Landcor, a B.C. real estate research firm, Albertans accounted for just 2.4 per cent of the $48.5-billion worth of residential real estate sold in B.C. last year, and just 2.6 per cent of the total number of units sold.

The biggest buyers by far? B.C. residents themselves. They accounted for $45.8 billion or 94.4 per cent of all residential real estate purchases in B.C. last year, says Landcor president Rudy Nielsen, who also operates NIHO Land and Cattle Co., a New Westminster, B.C.-based real estate firm.

"We broke it down into four categories, including detached homes, condos, vacant -- meaning vacant residential land, not ranches or industrial -- and 'other', which is townhouses, stuff like that," says Nielsen.

"Those four (categories) combined came to 166,254 units sold last year, for a total amount of $48,529,940 in sales. And out of that, Washington (accounted for) 352 units or $146 million; Ontario was 821 units, for $294 million; and California was 624 units, for $239 million."

And what about Alberta? "Alberta came in with 4,320 units for a total of $1.156 billion," says Nielsen. "So Albertans are the biggest buyers -- other than British Columbians themselves -- of land in B.C."

Still, Alberta's relatively modest contribution to B.C.'s real estate boom wouldn't seem to square with recent press coverage in Vancouver, where a Vancouver Sun story suggested Albertans are driving up B.C.'s real estate prices.

"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," the Sun reported. Although the Sun piece noted that Albertans bought more B.C. real estate than Ontario, California and Washington state combined in 2005, it failed to mention that Alberta's slice of the overall pie is still small.

Nielsen says he's not surprised that B.C. residents still account for the lion's share of all the real estate buying activity in B.C. "In all my speeches for years I've been saying the biggest buyers of recreational and small-town properties (in B.C.) are people from the Lower Mainland," he says.

"And that applies to (purchases of) Lower Mainland properties as well."

So why is there such persistent talk on the West Coast that out-of-province buyers are pushing up B.C.'s real estate prices?

"I guess it's (just) people talking and saying Americans are buying up the province and Albertans are buying up the province," says Nielsen.

"I think it's more that the local people get excited and they start buying.

"I think that's really what's happening. So it (foreign buying) is not as serious as everybody thinks it is."