Real Estate Hidden Gems in Canada

Historically, a meltdown in the U.S. economy such as the one we’re experiencing would ripple a wake of negative growth through Canada. So far, that’s not happened and some optimists wonder if Canada is flexing its economic independence for the first time. With an abundance of natural resources, the world’s second-largest country has staved off recession signals so far and Canada’s hot housing market continues to hum.

While growth in the urban regions, such as Vancouver and Calgary, is expected to slow to single-digits in 2008, other areas are forecasted to see sharp increases in property prices as home buyers and investors seek cheap land while also taking advantage of the boom in Canada’s oil, gas and agriculture industries.

Unlike U.S. financial institutions, Canada’s banks never offered subprime loans and have been able to avoid the credit crisis that’s staggered the U.S. Canada also has lowered its interest rates because its manufacturers rely on selling exports to the American market and those sales shrink as the Canadian dollar rises against its U.S. counterpart.

“Softer growth means lower interest rates and lower interest rates are positive for the housing market,” Gregory Klump, chief economist for the Canadian Real Estate Association, told CTV this month.

So Canadian real estate investors and home buyers are able to lock in a low interest rate on a mortgage despite the fact the economy is in an extended period of sustained growth.

Here is a look at three Canadian real estate spots that should see significant increase in demand this year:

1. Sooke, British Columbia – A part of the Greater Victoria Real Estate market, Sooke is a suburb of Victoria, the capital of Canada’s westernmost province. Located to the west of Victoria on Vancouver Island, Sooke benefits from a warm climate, growing infrastructure and from the lack of land beyond it. To the west of Sooke is the Pacific Ocean and a large swath of undeveloped territory that includes a protected national rainforest. Only dirt roads access those areas, meaning Sooke is the end of the line as far as GVRE real estate is concerned. As Victoria and its eastern suburbs become congested, demand for properties in Sooke will increase.

2. Gwillimbury, Ontario – If Toronto was situated a little farther south it would be in the United States and it would be the fourth-largest city there. And if lakefront property an hour’s drive from a large metropolis in the U.S. was available you would think it would be valued in the millions. By comparison, Gwillimbury and its neighboring towns located on Lake Simcoe are incredibly cheap. But as development in Ontario continues to sprawl that’s likely to change.

3. Greater Saskatoon, Saskatchewan – Bitterly cold and flat, Saskatchewan has been the butt of many Canadian jokes, but that’s changed. Agriculture is booming and the job market is clicking along at a torrid pace. House prices have followed, with real estate in Saskatoon being the most in demand. In January, the dollar value of real estate transactions in the region jumped 87 percent from January 2007 and year-over-year sales of residential units increased 37 percent, according to the province’s real estate association.