So I was walking down the streets of downtown Calgary, AB for the past few days and have bruised knees and sore ankles from tripping over other people's dropped bags of cash. I'd ask someone for the time, they'd give it to me and a $5 dollar bill for my trouble. Cash is king and there is plenty of new royalty in Cowtown.
On a more serious note, there are stark differences in the Calgary RE market to that of Victoria. First off, Calgary suffers no perceived shortage of land. I use perceived here a purpose; I don't believe for one minute that Victoria suffers from a shortage of land either, rather we suffer from a shortage of will to develop infrastructure that would support outward growth. We also have plenty more NIMBY's than they do, but that's another story altogether. Anyway, my point here is one about perception, and the difference between Calgary and Victoria as I interpret it. In Calgary, they see opportunity and challenges, they work to fix them, and they grow as a result. And as a secondary outcome, their massive growth has, despite the overwhelming price increases in RE, kept their prices more in-line with fundamentals.
How can I say this? My sister bought a house in Airdrie, 30 kilometres north of downtown. She paid less than $300K last year (she bought before completion and closed in the last 7 months) and between her and her partner pay out less than 35% of their after-tax income in mortgage and property tax payments for a 2200 SF home. That's the suburbs you say, and not actually in Calgary. You're right. But considering that in heavy rush hour traffic it took me less than 25 minutes to pull into the downtown hotel parking lot (4th Ave and 5th St) of the convention I was attending every day I'd say it's reasonable enough.
Compare that to the nearest bedroom community of Victoria in Langford. $300K doesn't even buy you an 800 SF brand new, two-bedroom condo before completion. And you can't get downtown in 25 minutes during rush hour. So, the price difference here, only taking price per square foot into consideration is $375/SF in Victoria compared to $136/SF in Calgary, or $239/SF. It is comparing apples to doughnuts for certain, but I'll go on record anytime, anywhere with this statement: the lifestyle that Victoria offers, with the weather that Victoria has, is not worth $239/SF in purchase price, especially when you consider incomes. Calgarians are making, on average, almost 20-30% more for semi-professional and professional jobs.
Guess what? Calgary's market isn't as hot as it used to be. Where slick ads used to sell homes, show homes, and lots of them (in my sister's community of less than 300 homes, there are more than 2-dozen show homes), are now necessary to entice buyers into new communities. And communities they are. In Victoria, developers market pseudo-villages to older buyers. In Calgary, developers market new communities, with all the amenities--schools, shopping, daycares--to younger, getting-established types. I wonder which is the more sustainable market for a city to grow with?
The downtown markets are, of course, completely different and likely far more comparable. But that isn't the point of my comparison. I'm comparing products that fit our economic criteria in two vastly different locations with different appeals and different drawbacks. I've lived in both towns and like them for different reasons. Calgary wins this comparison, for me alone, without fail, on any conditions I may place on the comparison.