The Calgary Real Estate Board (CREB) recently released its 2014 housing forecast for Calgary, announcing an anticipated price increase of 4.3 per cent and a 3.6 per cent growth in resale home sales.
This translates to a ‘healthy’ anticipated growth predictor for the market in outlying communities such as Airdrie, Okotoks and Cochrane.
“Cochrane is interesting because it’s behaved a little differently than other markets…we’ve seen active listings and inventory levels improve in the second half of 2013,” said Ann-Marie Lurie, chief economist for CREB.
Lurie explained that compared to tighter markets in Airdrie and Okotoks, Cochrane has had a boom in new construction, creating a more balanced supply and demand.
While this is positive for builders and sellers, young families facing a local rental market that could be dubbed ‘in crisis’ and a home ownership market that continues to climb may be experiencing some apprehension and concern.
With one of the highest annual family incomes in the province, in excess of $80,000 annually, the close proximity to one of the most thriving cities in the country and with each passing year exceeding growth predictions, many consider Cochrane a desirable place to live.
But with average single-family homes sitting in the neighbourhood of $470,000 and average rental rates in the ballpark of $1,700, young families or singles at the start of their careers may need to seek alternative options in order to reside in the foothills community.
Local housing organization, the Cochrane Society for Housing Options (CSHO), has been a non-profit agency in operation since 2003, with a mandate to: ‘promote access to safe, suitable and diverse housing appropriate to the incomes of Cochrane citizens.’
Currently, the CSHO has 21 units they rent out to qualified, low-income individuals and families and also manage a four-plex owned by the town.
The organization is working on obtaining another 13 rental units (to be rented out at 10 per cent below market value) and will continue to work on home ownership programs for low-middle income families.
“The problem with the number of rental units available is not unique to Cochrane. It’s an Alberta problem,” said CSHO chair Glen Sine, a sentiment echoed by housing coordinator Corinne Burns.
“There’s a lot of pressure on the rental housing market… this affects businesses being able to attract and retain people to work,” said Burns, adding that her office has had a recent influx of calls from people gaining employment in the various new businesses opening up in the Quarry site, who need a place to live.
Suzanne Gaida, senior manager of planning and development for the Town of Cochrane, said the Town will continue to work with and support the CSHO, but said this only addresses one small part of the problem.
“There is a gap in the rental housing market and we’ve got more work to do when it comes to the rental housing market.”
Gaida suggested some of the onus might fall on new businesses to look at opportunities to house their employees.
Councillor Jeff Toews, who is also a mortgage broker, said there is a fine balance between the responsibility of the Town to provide more rental opportunities for new and existing Cochranites versus the onus on some of the bigger businesses to look into staff accommodation housing opportunities, as well as on individuals to improve their financial situations.
At the end of the day, in order to subsidize housing options for lower income individuals, the funds would stem from increased taxes for the already struggling middle class.
Toews said the current rental market might result in families and individuals looking at more affordable housing opportunities such as starter homes (townhouses, condos, apartments and duplexes).
“The very first thing is to set up a plan,” said Toews
He added that he always points clients in the direction of a financial planner, as well as seeking advice from a mortgage broker; for some, alternative solutions to come up with funds for a down payment may prove to be more cost-effective than continuing to rent.
Toews said the town would continue to work with the CSHO, as well as support the Town’s economic development team to continue to devise solutions.
Toews and Gaida encourage potential stakeholders to come forward with their ideas, questions and concerns.
Lurie said if the current market causes some to look at home ownership earlier than anticipated, people should account for a number of factors, including how long they plan to live in their current community and where they are at in their careers.
According to CREB, 554 homes were sold on the re-sale market in Cochrane in 2013; this is a nine per cent increase from 2012 and does not include new home construction figures.
