Why Rental Properties are a Great Investment in Calgary

April 5th, 2024

As the real estate market in Canada continues to experience changes, Calgary emerges as a standout destination for real estate investment, particularly in the rental sector. With its dynamic economy, growing population, and favourable investment climate, Calgary has become the top choice for investors seeking to capitalize on the thriving rental market. Below is a breakdown of why rental properties are a great investment in Calgary.

Six Reasons Why Rental Properties are a Great Investment Opportunity in Calgary

Let’s delve deeper into why Calgary is at the forefront of the rental property investment landscape and explore why rental properties are a good investment in Calgary.

1. Calgary’s Rental Rates on a Rapid Upward Trajectory

The rental landscape in Calgary is experiencing a significant increase with rent increasing at a faster rate than in any other major Canadian city.

Data reveals a remarkable surge in rental prices, with an overwhelming 17.2% year-over-year increase for one-bedroom apartments. Additionally, there is a substantial 16.9% surge for two-bedroom apartments.

This upward trajectory in rental rates not only underscores the high demand for rental accommodations in Calgary. It also signals a favourable environment for property owners and landlords.

2. Housing Shortage Means Guaranteed Rates

The persistent issue of housing shortage in Calgary has contributed to the demand for rental properties. It ultimately ensuring a steady influx of tenants. As the population continues to grow, the housing supply struggles to keep pace. Calgary is home to more than 1.4 million people and the population is expected to reach 2-million over the next 50-to-60 years.

Ultimately, property owners can capitalize on this shortage by offering rental accommodations at competitive rates. It resultantly provides a sense of security and predictability in rental income.

The Canada Mortgage and Housing Corporation (CMHC), estimates Alberta needs 20,000 additional housing units by 2030 — above and beyond current rates of construction.

3. Your Chance to Build Equity

Owning rental properties in Calgary presents a unique opportunity to build equity over time.

This potential for wealth creation through property appreciation and mortgage paydown underscores the enduring appeal of rental properties as a sound investment choice in Calgary. Here are a few highlights on the opportunities available to start building equity:

  • No land transfer tax 
  • No HST – only 5% GST
  • Alberta favours landlords and investors
  • Low deposit and fees
  • No rent control – you price your product based on what you think is fair
  • Affordability – prices are at 50% less compared to Toronto.

In comparison to Toronto, Calgary condos provides landlords with the option to control the rent price while providing flexibility in setting their own contract, which includes clauses on pets, damage deposits, extensions and more. If the tenant fails to adhere to the contract, landlords have the authority to go through a quick and easy eviction process.

4. Lower Purchase Cost

The purchase cost of rental properties in Calgary remains relatively favourable compared to other major Canadian cities.

Prices for pre-construction condos are half the cost with only a 10% deposit in Calgary, in comparison to higher prices and a 20% deposit in other areas in Canada. In addition, there is no land transfer or provincial sales tax in Calgary, no development charges and no hidden fees.

This lower entry barrier empowers investors to acquire rental properties at a more affordable price point. It ultimately enhances the feasibility of real estate investment and amplifying the potential for attractive returns on investment.

5. Calgary’s Reputation for Award-Winning Livability

Calgary has earned a well-deserved reputation as Canada’s 1st and one of the most livable cities in the world. It boasts exceptional standards of healthcare, safety, education, and overall quality of life. Calgary offers a unique blend of urban living and natural beauty, making it an ideal choice for residents seeking a vibrant yet serene lifestyle.

The desirable livability of the city has consistently drawn individuals and families seeking an enriching and fulfilling lifestyle – ultimately fueling the demand and growth of the real estate market and a hotspot for rental properties.

6. Steady Rental Income

Investing in rental properties in Calgary offers the promise of a steady and reliable rental income stream. With the growing job market and a vibrant economy, the demand for rental properties remains robust, providing property owners with a consistent flow of rental income. The stability and predictability of this income stream make rental properties an attractive investment avenue. It is especially truer for those seeking financial security and long-term wealth accumulation.

Final Verdict

With rental rates skyrocketing at an unprecedented pace, a persistent housing shortage ensuring guaranteed occupancy, and a reputation for award-winning livability, Calgary stands out as a hotspot for lucrative rental property investments. Add to that the lower purchase costs compared to other major Canadian cities and the promise of steady rental income, and it’s clear why rental properties in Calgary are seen as a pathway to long-term wealth accumulation. Purchase a rental now.

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