Radio Ads
Have you heard the ads lately? It wasn’t that long ago it was only Concrete Equities and Platinum Equities advertising on the radio and TV about Real Estate investment opportunities. Then of course all the recreational Real Estate opportunity ads started to appear (as I predicted last year!) as many US and foreign companies realized how much money was in Alberta.
Well it appears the pendulum is swinging back again. There are still radio and TV ads for some of the BC opportunities and Caribbean recreational properties, but the new ads that are popping up for companies like Foundation Capital, Lucid Investments, and numerous others are all Alberta properties and projects. Could they be on to something?
After all, with so many people selling doesn’t that make it the perfect time to be buying? From a business standpoint, it makes far more sense to purchase when everyone is selling and to sell when everyone is buying. These companies have realized that, set their marking promotions on high and are creating wonderful opportunities for investors, much like we have been doing for the last five years.
With the speculators pushed mostly out of the market and now focusing on Saskatchewan and other short term higher risk approaches, the investors who look at Real Estate from a longer term perspective are starting to step up to the forefront. Time is an incredible asset for Real Estate investments as long as you pick targeted vibrant areas with great long term prospects.
Alberta is obviously one of the best areas for this type of investing. With demand for oil high for at least the next decade, the megaprojects in place and forecasted to start will continue to create a strong economy. These factors all point to more growth in property values over the next five years. We haven’t peaked as some doomsayers predict, we are not poised to have our own sub-prime crisis and as anyone in the oil industry knows, oil prices will not drop to $30 a barrel anytime soon.
With the unsteady US economy affecting the stock markets, many individuals are seeing their investments and their RRSP returns in a very sad state. This has created a perfect storm for many companies to move forward with purchasing more local investment property to help create wealth for everyone involved. This brings us back to all these radio ads and companies coming out of the woodwork to promote their offerings.
If you have been hearing these ads, and have questions about Real Estate investments, we would love to talk to you. We have been creating these opportunities for over five years for ourselves and other investors and as I mentioned, now is a great time for all the Real Estate investment companies. Your future is in your hands, so the more information you can acquire will allow you to make the best decisions.
BMW’s are Boring
I can remember ten years ago, perhaps even not quite that long, that BMW’s weren’t very common on the road. Maybe you would see one or two a day and you might see a Porsche once a week. How times have changed here in Alberta.
Now BMW’s are everywhere as are Porsches. While it’s true many newer models have come out that are more affordable than they used to be, these types of vehicles are still on the higher end and cost more than most vehicles. These changes around us are going on and many Calgarians and Albertans didn’t seem to realize it’s changed.
Currently when you drive around it is becoming a daily occurrence to see even higher end vehicles. In one day last week, I saw a Ferrari in the morning, a Lamborghini in the afternoon and while I was driving home at night, I passed a Rolls Royce (it was an older model, but that was a real surprise!). In the last two weeks, I have seen almost a dozen Ferrari’s, a few of Lamborghini’s, a Maserati, half a dozen Vipers and over 25 Corvettes. I also know there are Bentleys and Aston Martins around; I just may have missed them.
This is even more apparent to me after the two weeks we spent in BC and after driving around and visiting in Kelowna and Victoria, we saw a grand total of one Lamborghini and possibly half a dozen Corvettes. There were however, lots of BMW around!
So what is the point of my car counting observations? The point is there is a lot of disposable cash and wealthy people around here. You have to have a considerable amount of income to spend $100,000 or more for a vehicle which you use for only three to six months of the year and keep in storage the rest of the time. I’m probably being generous with three months around here, although this year may be an exception.
This is the type of wealth that helps make $450,000 average home prices affordable for many people. It also helps to maintain these higher average values over time. Disposable income is one of the key indicators of a strong economy and potential growth in property value.
While expensive vehicles are one example of this disposable income and may be a small portion of it, this effect trickles down. While exotic cars may be beyond most people’s income level, perhaps you should be aware of how many new convertibles are driving around these days.
There are plenty of new Saturn Sky’s out there, Ford Mustang convertibles, and now the ubiquitous BMW and Audi convertibles as you drive around. While these aren’t classified as exotics, they certainly do count as a luxury type of expenditure in most cases, especially when you remember our cold winter months! As far as this goes, as you look around there are plenty of new vehicles of all types around.
Alberta has been going through so many years of growth and wealth creation we have just become blinded to how fortunate we have been and how much money is out here. We are still an energy based economy and oil prices have come down significantly, but they continue to be at higher levels than we even dreamed about three years ago.
So while our economy has slowed down to a level that appears to concern people, look around at all the people driving in their vehicles. We still have plenty of disposable income, energy prices are still at great levels for continuing long term growth in our economy and the long term outlook is still very rosy for the wild rose province!
As a social experiment (and to see if I can get people to actually participate), lets track over the next week to see how many of these higher end vehicles you see. Then perhaps post your findings every day as comments on this Newsletter. It’s not hard to do, when you originally signed up you were provided a password and username, if you have lost, forgotten, or just never saw it, just click on the login button located on the right menu system. On the new screen where you enter your password at the bottom, is an option that says Lost your password? Click on it and follow the instructions to get your password. From there post away!
In Closing
The summer break for the children is rapidly ending for everyone and August has been an incredible month for us weather wise in Calgary. It has also been a wonderful time for visiting with friends and family. We have only had a couple weekends all summer where we weren’t away, booked with friends or we had someone in visiting from out of town. I hope everyone else was able to take advantage of his or her summer as well.
With September rapidly approaching we are eager to see how the Real Estate market unfolds during such unique times. We have a clear idea of where we will end up (increasing values over the next five years), it’s just a matter of how we are getting there (flat for another year and then short quick growth, or flat for another couple of months with slow growth, or somewhere in between?).
We would like to thank everyone who has come along with us for this ride and we look forward to the continued addition of more people coming on board and joining in our investments. If you haven’t talked to us yet and just need more information about opportunities, don’t wait; contact us now so we can schedule a chat.
So be sure to make the most of the rest of the summer, fit some more time in with family and friends and watch for more updates on the blog as my summer ends!
Regards,
Bill and Karen Biko
KatSid Housez Inc.
info@housez.ca
403-870-4663
