March 2011 Alberta Economic Fundamentals
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Alberta housing affordability best in Canada
CALGARY - Alberta officially became the most affordable province in the country for home ownership in the fourth quarter of 2010 and affordability in Calgary is now the best it's been in almost six years, says a new report released Thursday by RBC.
The Housing Trends and Affordability report said a gradual but steady recovery in housing demand in the past half-year has just begun to bolster market conditions in the Calgary area by drawing the prolonged slump since 2007 closer to an end.
In Calgary on a seasonally-adjusted basis, home resales increased appreciably since the June 2010 lows, and this "helped to reduce the market slack significantly by the end of last year that kept buyers in the driver's seat.
Read the full article here.
CALGARY - Alberta officially became the most affordable province in the country for home ownership in the fourth quarter of 2010 and affordability in Calgary is now the best it's been in almost six years, says a new report released Thursday by RBC.
The Housing Trends and Affordability report said a gradual but steady recovery in housing demand in the past half-year has just begun to bolster market conditions in the Calgary area by drawing the prolonged slump since 2007 closer to an end.
In Calgary on a seasonally-adjusted basis, home resales increased appreciably since the June 2010 lows, and this "helped to reduce the market slack significantly by the end of last year that kept buyers in the driver's seat.
Read the full article here.
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Alberta plunges deep into the red
EDMONTON - Premier Ed Stelmach`s government tabled a 2011-2012 budget Thursday that holds the line on spending but plunges the province deep into the red with a projected $3.4-billion deficit.
Albertans won`t see any tax increases, but there will be increased fees for services such as drivers licences and campsite rentals, which will add $86 million to government coffers.
Finance Minister Lloyd Snelgrove said the government will charge ahead with its controversial three-year, $17.6-billion capital plan that will put $6.6 billion toward infrastructure in the coming year.
Read the full article here.
EDMONTON - Premier Ed Stelmach`s government tabled a 2011-2012 budget Thursday that holds the line on spending but plunges the province deep into the red with a projected $3.4-billion deficit.
Albertans won`t see any tax increases, but there will be increased fees for services such as drivers licences and campsite rentals, which will add $86 million to government coffers.
Finance Minister Lloyd Snelgrove said the government will charge ahead with its controversial three-year, $17.6-billion capital plan that will put $6.6 billion toward infrastructure in the coming year.
Read the full article here.
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Alberta now home to cheap housing
Canadians confronted with soaring prices while trying to buy a home in Toronto, Vancouver and Montreal this past year should consider Alberta ` once the poster child for and overheated market, but now the most affordable province in the country according to a new report from RBC Economics Research said Thursday.
Robert Hogue, senior economist with RBC and author of the report, said a combination of a housing bust, slowing economy and population outflows starting as far back as 2007 has created a real estate market that has been `sideways at best` for the past few years and finally resulted in the province becoming officially the cheapest in the fourth quarter of 2010.
`From 2000 to 2007, the Albertan housing market was on fire. There was not enough supply, so prices shot through the roof, but in 2007 demand started to cool,` he said. `Any pressure on prices since has been downwards.`
Read the full article here.
Canadians confronted with soaring prices while trying to buy a home in Toronto, Vancouver and Montreal this past year should consider Alberta ` once the poster child for and overheated market, but now the most affordable province in the country according to a new report from RBC Economics Research said Thursday.
Robert Hogue, senior economist with RBC and author of the report, said a combination of a housing bust, slowing economy and population outflows starting as far back as 2007 has created a real estate market that has been `sideways at best` for the past few years and finally resulted in the province becoming officially the cheapest in the fourth quarter of 2010.
`From 2000 to 2007, the Albertan housing market was on fire. There was not enough supply, so prices shot through the roof, but in 2007 demand started to cool,` he said. `Any pressure on prices since has been downwards.`
Read the full article here.
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Bitumen new king of Alberta's oilsands box
CALGARY-Oilsands is the new king of Alberta's oilpatch after the provincial government forecast that bitumen will account for almost half of non-renewable resource revenue in the upcoming fiscal year.
According to budget documents, oilsands are expected to bring in $4.1 billion of a projected $8.3 billion in resource revenues. Natural gas royalties, however, are only expected to reach $1 billion in the new budget year, the lowest annual take since the 1990s. By contrast, gas royalties peaked at $8.4 billion in 2006.
"It started a while ago, but this is probably as dramatic a shift as we've seen in a long time," said Greg Stringham, the Canadian Association of Petroleum Producers' vice-president of oilsands. "The dichotomy that has risen between oil and gas is quite dramatic."
Read the full article here.
CALGARY-Oilsands is the new king of Alberta's oilpatch after the provincial government forecast that bitumen will account for almost half of non-renewable resource revenue in the upcoming fiscal year.
According to budget documents, oilsands are expected to bring in $4.1 billion of a projected $8.3 billion in resource revenues. Natural gas royalties, however, are only expected to reach $1 billion in the new budget year, the lowest annual take since the 1990s. By contrast, gas royalties peaked at $8.4 billion in 2006.
"It started a while ago, but this is probably as dramatic a shift as we've seen in a long time," said Greg Stringham, the Canadian Association of Petroleum Producers' vice-president of oilsands. "The dichotomy that has risen between oil and gas is quite dramatic."
Read the full article here.
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Alberta sees Mideast crisis as boon for oilsands
At the height of the crisis in Egypt earlier this month, just a day before Hosni Mubarak succumbed to revolutionary pressures, a group of worried U.S. lawmakers met in a congressional office building just off Capitol Hill to seek answers to a seemingly intractable American problem.
What could be done, finally, to start weaning the United States off foreign oil?
Gary Mar, the Alberta government's representative in Washington, sat at the witness table ready to offer a solution.
"Our oil comes from a politically stable and democratic neighbour and is sent to the U.S. via pipeline, so it is not affected by political unrest or other disruptions," Mar told members of the House subcommittee on energy and power during the Feb. 10 hearing.
Read the full article here.
At the height of the crisis in Egypt earlier this month, just a day before Hosni Mubarak succumbed to revolutionary pressures, a group of worried U.S. lawmakers met in a congressional office building just off Capitol Hill to seek answers to a seemingly intractable American problem.
What could be done, finally, to start weaning the United States off foreign oil?
Gary Mar, the Alberta government's representative in Washington, sat at the witness table ready to offer a solution.
"Our oil comes from a politically stable and democratic neighbour and is sent to the U.S. via pipeline, so it is not affected by political unrest or other disruptions," Mar told members of the House subcommittee on energy and power during the Feb. 10 hearing.
Read the full article here.
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Edmonton downtown arena won't bust other businesses: Report
EDMONTON ` Downtown arena projects in five American cities generally didn`t hurt existing businesses, despite concerns they would take a big bite out of the competition, says a new report.
Two professors hired by the City of Edmonton found the value of downtown commercial property stayed roughly the same or rose compared to commercial sites in surrounding counties after sports facilities were built.
`As our examples indicate, business properties in the central city have remained relatively equal in proportion to the county (or even increased),` wrote University of Alberta`s Dan Mason and Mark Rosentraub from the University of Michigan.
Read the full report here.
EDMONTON ` Downtown arena projects in five American cities generally didn`t hurt existing businesses, despite concerns they would take a big bite out of the competition, says a new report.
Two professors hired by the City of Edmonton found the value of downtown commercial property stayed roughly the same or rose compared to commercial sites in surrounding counties after sports facilities were built.
`As our examples indicate, business properties in the central city have remained relatively equal in proportion to the county (or even increased),` wrote University of Alberta`s Dan Mason and Mark Rosentraub from the University of Michigan.
Read the full report here.
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Calgary retail sales forecast to soar
CALGARY - Retail sales in the Calgary region are forecast to balloon by $7.2 billion to $28.678 billion a year in 2015, far outpacing the annual rate of growth at the national average.
After seeing a 9.1 per cent annual decline in 2009, the Conference Board of Canada said retail sales rebounded in the Calgary census metropolitan area in 2010 with a 5.1 per cent hike to $21.433 billion.
And from 2011 to 2015, the region is expected to see annual growth rates of 5.0 per cent, 6.4 per cent, 6.4 per cent, 6.1 per cent and 6.2 per cent.
"The emergence of the greater Calgary region as an economic hub and retail powerhouse is evident in the busy shopping centres and other retail venues across the city," said Michael Kehoe, an Alberta-based retail specialist with Fairfield Commercial Real Estate Inc. "High levels of consumer confidence and retail spending are driven by the diversified local economy led by the oil and gas industry that continues to provide a boost to the regional economic scene with retail sales ahead of 2010 levels.
Read the full article here.
CALGARY - Retail sales in the Calgary region are forecast to balloon by $7.2 billion to $28.678 billion a year in 2015, far outpacing the annual rate of growth at the national average.
After seeing a 9.1 per cent annual decline in 2009, the Conference Board of Canada said retail sales rebounded in the Calgary census metropolitan area in 2010 with a 5.1 per cent hike to $21.433 billion.
And from 2011 to 2015, the region is expected to see annual growth rates of 5.0 per cent, 6.4 per cent, 6.4 per cent, 6.1 per cent and 6.2 per cent.
"The emergence of the greater Calgary region as an economic hub and retail powerhouse is evident in the busy shopping centres and other retail venues across the city," said Michael Kehoe, an Alberta-based retail specialist with Fairfield Commercial Real Estate Inc. "High levels of consumer confidence and retail spending are driven by the diversified local economy led by the oil and gas industry that continues to provide a boost to the regional economic scene with retail sales ahead of 2010 levels.
Read the full article here.
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Calgary resale housing market can expect year-over-year price growth
CALGARY - Short-term year-over-year price growth expectations for the Calgary resale housing market are in the range of five to seven per cent, according to the Conference Board of Canada.
In its Metro Resale Index released Thursday, the board said the average price in Calgary was $397,514 in January, up from $385,049 in January 2010.
It said that seasonally-adjusted sales on an annual basis were 21,996 for January, up slightly from 21,924 in December but off from 23,508 in January 2010.
Joining Calgary in the five to seven per cent range of short-term price growth were Victoria, Vancouver, the Fraser Valley, Regina, Winnipeg, Halifax and Newfoundland.
Read the full article here.
CALGARY - Short-term year-over-year price growth expectations for the Calgary resale housing market are in the range of five to seven per cent, according to the Conference Board of Canada.
In its Metro Resale Index released Thursday, the board said the average price in Calgary was $397,514 in January, up from $385,049 in January 2010.
It said that seasonally-adjusted sales on an annual basis were 21,996 for January, up slightly from 21,924 in December but off from 23,508 in January 2010.
Joining Calgary in the five to seven per cent range of short-term price growth were Victoria, Vancouver, the Fraser Valley, Regina, Winnipeg, Halifax and Newfoundland.
Read the full article here.
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Case for new arena no 'slam dunk'
EDMONTON - Agree with him or not, it's hard to dismiss Andrew Zimbalist as a lightweight, or a mouthpiece for vested interests.
Over the past 20 years, the Harvard-educated economist has become one of North America's leading experts on the business of pro sports.
The Smith College professor has written a string of highly-acclaimed books; his articles have run in dozens of high-profile publications such as the New York Times; he has advised various state and city governments on stadium financing issues; and he once provided a financial analysis of NHL franchises for the league players' association.
Given that, it's not surprising that Northlands sought out Zimbalist last year to get his take on the $450million downtown arena project being proposed by Edmonton Oilers owner Daryl Katz.
Read the full article here.
EDMONTON - Agree with him or not, it's hard to dismiss Andrew Zimbalist as a lightweight, or a mouthpiece for vested interests.
Over the past 20 years, the Harvard-educated economist has become one of North America's leading experts on the business of pro sports.
The Smith College professor has written a string of highly-acclaimed books; his articles have run in dozens of high-profile publications such as the New York Times; he has advised various state and city governments on stadium financing issues; and he once provided a financial analysis of NHL franchises for the league players' association.
Given that, it's not surprising that Northlands sought out Zimbalist last year to get his take on the $450million downtown arena project being proposed by Edmonton Oilers owner Daryl Katz.
Read the full article here.
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Alberta Tories raid savings and hike user fees in new budget
The Alberta government is sinking deeper into red ink - projecting a $3.4-billion deficit in Thursday's provincial budget -but is clinging to a bitumen bounty and depleting rainyday fund to keep it financially afloat in the coming years.
The Stelmach government's 2011-12 fiscal blueprint holds the line on overall spending, but pledges billions of dollars of new cash toward priority areas such as health care, social supports and infrastructure.
"We could have made cuts that some critics were calling for, cuts that would have been damaging to core programs or infrastructure plans, but that would be short-sighted," Finance Minister Lloyd Snelgrove said. "We didn't panic during the darkest days of the recession and we're not going to panic now."
Read the full article here.
The Alberta government is sinking deeper into red ink - projecting a $3.4-billion deficit in Thursday's provincial budget -but is clinging to a bitumen bounty and depleting rainyday fund to keep it financially afloat in the coming years.
The Stelmach government's 2011-12 fiscal blueprint holds the line on overall spending, but pledges billions of dollars of new cash toward priority areas such as health care, social supports and infrastructure.
"We could have made cuts that some critics were calling for, cuts that would have been damaging to core programs or infrastructure plans, but that would be short-sighted," Finance Minister Lloyd Snelgrove said. "We didn't panic during the darkest days of the recession and we're not going to panic now."
Read the full article here.
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U.S. must build on its oil ties with Canada
Perhaps no two countries have a stronger - and more special - partnership than do the United States and Canada. It is the world's largest trading relationship, and Canada plays a tremendous role in our nation's economic and energy security.
Canada is already our country's largest supplier of imported oil. As Americans watch the unsettling events unfolding in Egypt and elsewhere in the Middle East, it should be comforting to note that most of the oil we import comes from our friendly and reliable next-door neighbour.
And that neighbour is poised to provide even more of the energy America needs as it develops its vast oilsands resources. Canadian oilsands can support significant U.S. economic growth and job creation, at a time when both are needed desperately. That can only happen, however, if we have adequate means to transport that oil to refineries in the United States.
Read the full article here.
Perhaps no two countries have a stronger - and more special - partnership than do the United States and Canada. It is the world's largest trading relationship, and Canada plays a tremendous role in our nation's economic and energy security.
Canada is already our country's largest supplier of imported oil. As Americans watch the unsettling events unfolding in Egypt and elsewhere in the Middle East, it should be comforting to note that most of the oil we import comes from our friendly and reliable next-door neighbour.
And that neighbour is poised to provide even more of the energy America needs as it develops its vast oilsands resources. Canadian oilsands can support significant U.S. economic growth and job creation, at a time when both are needed desperately. That can only happen, however, if we have adequate means to transport that oil to refineries in the United States.
Read the full article here.
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Oilpatch needs better attitude, says head of GE
CALGARY - The Canadian oilpatch needs to stop blaming others for its bad public relations around the oilsands and find new markets, said Jeff Immelt, the head of GE.
Immelt, in Calgary to meet with oil and gas producers, scolded the industry at a luncheon Friday for using poor tactics in promoting the secure energy source.
Canada's oilpatch needs to step off its high horse and stop calling opponents idiots, he said.
"You guys have a collective problem that you have done a terrible job of marketing the technology, and that is on you," Immelt told an audience of oil and gas executives and Calgary entrepreneurs. "The fact that you've allowed yourself to be painted into this corner is ridiculous."
Read the full article here.
CALGARY - The Canadian oilpatch needs to stop blaming others for its bad public relations around the oilsands and find new markets, said Jeff Immelt, the head of GE.
Immelt, in Calgary to meet with oil and gas producers, scolded the industry at a luncheon Friday for using poor tactics in promoting the secure energy source.
Canada's oilpatch needs to step off its high horse and stop calling opponents idiots, he said.
"You guys have a collective problem that you have done a terrible job of marketing the technology, and that is on you," Immelt told an audience of oil and gas executives and Calgary entrepreneurs. "The fact that you've allowed yourself to be painted into this corner is ridiculous."
Read the full article here.
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The Albertan metal collector behind a new oilsands upgrader
It is a deceptively rustic scene ` a remote ranch house perched on a windy promontory, with postcard-perfect views of the Alberta foothills and mountains.
But beneath the ground, 2,000 years of industrial history lie buried. The house provides access to a twisting tunnel of brightly lit galleries and displays containing gears, tools, pumps and thousands of metal objects.
At the heart of this subterranean trove is a 60-ton steam engine named Mary, lovingly salvaged from the cradle of the Industrial Revolution in northern England and rebuilt in the middle of Cowboy Country.
`It`s a pretty cool thing,` enthuses Ian MacGregor, the Calgary investor, engineer and collector whose lifelong passion for metal and history has forged this underground time capsule ` the 20,000-square-foot Canadian Museum of Making.
Read the full article here.
It is a deceptively rustic scene ` a remote ranch house perched on a windy promontory, with postcard-perfect views of the Alberta foothills and mountains.
But beneath the ground, 2,000 years of industrial history lie buried. The house provides access to a twisting tunnel of brightly lit galleries and displays containing gears, tools, pumps and thousands of metal objects.
At the heart of this subterranean trove is a 60-ton steam engine named Mary, lovingly salvaged from the cradle of the Industrial Revolution in northern England and rebuilt in the middle of Cowboy Country.
`It`s a pretty cool thing,` enthuses Ian MacGregor, the Calgary investor, engineer and collector whose lifelong passion for metal and history has forged this underground time capsule ` the 20,000-square-foot Canadian Museum of Making.
Read the full article here.
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If you think this oil spike is temporary, check out this chart
This oil price spike is going to be anything but short lived, if you believe this chart from Morgan Stanley.
It details how by the year 2013, there's not going to be any excess supply in the system. That means, even if the Saudis aren't lying about being able to ramp up production like Jim Rogers says, they've only got two more years to do so before that spare capacity evaporates.
So beyond the Middle East instability trend, there's a much bigger problem lurking.
Read the full article here.
This oil price spike is going to be anything but short lived, if you believe this chart from Morgan Stanley.
It details how by the year 2013, there's not going to be any excess supply in the system. That means, even if the Saudis aren't lying about being able to ramp up production like Jim Rogers says, they've only got two more years to do so before that spare capacity evaporates.
So beyond the Middle East instability trend, there's a much bigger problem lurking.
Read the full article here.
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Final leg of Anthony Henday Drive gets green light
FORT SASKATCHEWAN ` The final and most complex leg of Edmonton`s Anthony Henday Drive has been given the `green light,` Premier Ed Stelmach announced Wednesday in a speech in Fort Saskatchewan.
The massive project ` named Anthony Henday Drive Northeast ` will be Alberta`s single largest highway construction project to date with 47 bridges, eight interchanges and 27 kilometres of six- and eight-lane divided road that will connect Whitemud Drive East to the Manning Freeway. It`s expected to ease the traffic crush on Yellowhead Trail and, to some degree, the Whitemud.
`It is the biggest transportation infrastructure job in Alberta`s history, we believe, because of the complexities of it,` said Transportation Minister Luke Ouellette. He agreed it will stand as a testament to Stelmach`s time as premier.
Read the full article here.
FORT SASKATCHEWAN ` The final and most complex leg of Edmonton`s Anthony Henday Drive has been given the `green light,` Premier Ed Stelmach announced Wednesday in a speech in Fort Saskatchewan.
The massive project ` named Anthony Henday Drive Northeast ` will be Alberta`s single largest highway construction project to date with 47 bridges, eight interchanges and 27 kilometres of six- and eight-lane divided road that will connect Whitemud Drive East to the Manning Freeway. It`s expected to ease the traffic crush on Yellowhead Trail and, to some degree, the Whitemud.
`It is the biggest transportation infrastructure job in Alberta`s history, we believe, because of the complexities of it,` said Transportation Minister Luke Ouellette. He agreed it will stand as a testament to Stelmach`s time as premier.
Read the full article here.
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Duelling Edmonton arena consultants face off
EDMONTON - The war between the Katz Group and Northlands is boiling again and the future of Edmonton's downtown arena project is on the line.
The two Edmonton sports powerhouses are not attacking each other in public. That would be unseemly, especially as city council sits down Wednesday to hear the latest updates from city managers, who are now negotiating with the Katz Group on a new arena deal.
Instead, this bitter battle is being fought by proxy, by way of two American experts, Andrew Zimbalist and Mark Rosentraub, who have known and worked with one another for 30 years, but who have somewhat differing views on how Edmonton city council should proceed when it comes to a new arena.
Read the full article here.
EDMONTON - The war between the Katz Group and Northlands is boiling again and the future of Edmonton's downtown arena project is on the line.
The two Edmonton sports powerhouses are not attacking each other in public. That would be unseemly, especially as city council sits down Wednesday to hear the latest updates from city managers, who are now negotiating with the Katz Group on a new arena deal.
Instead, this bitter battle is being fought by proxy, by way of two American experts, Andrew Zimbalist and Mark Rosentraub, who have known and worked with one another for 30 years, but who have somewhat differing views on how Edmonton city council should proceed when it comes to a new arena.
Read the full article here.
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Oil's well
Canada's energy industry has failed to tell the real story of Alberta's oilsands, or confidently play the secure-energy card.
The Herald has long called on government and industry to fight activists' false claims with the facts. Now, two prominent leaders have joined the chorus - one from industry, the other an environmentalist.
Jeff Immelt, CEO of GE Corp., had harsh words for his audience of oil and gas producers at a chamber of commerce luncheon.
Read the full article here.
Canada's energy industry has failed to tell the real story of Alberta's oilsands, or confidently play the secure-energy card.
The Herald has long called on government and industry to fight activists' false claims with the facts. Now, two prominent leaders have joined the chorus - one from industry, the other an environmentalist.
Jeff Immelt, CEO of GE Corp., had harsh words for his audience of oil and gas producers at a chamber of commerce luncheon.
Read the full article here.
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No rush for Edmonton homebuyers despite tightening mortgage rules
EDMONTON - Tighter mortgage rules coming in March aren`t causing a rush in Edmonton home sales, says the president of the Realtors Association of Edmonton.
On Wednesday, the group released Edmonton-area MLS figures showing 1,044 homes were sold in February.
That number shows an improvement over January, when 735 homes were sold, but that`s 20.6 per cent off the pace set a year earlier.
Across Canada, sales of existing homes rose in January to the highest level since April 2010, led by Vancouver, Toronto and Victoria, the Canadian Real Estate Association said last month.
Read the full article here.
EDMONTON - Tighter mortgage rules coming in March aren`t causing a rush in Edmonton home sales, says the president of the Realtors Association of Edmonton.
On Wednesday, the group released Edmonton-area MLS figures showing 1,044 homes were sold in February.
That number shows an improvement over January, when 735 homes were sold, but that`s 20.6 per cent off the pace set a year earlier.
Across Canada, sales of existing homes rose in January to the highest level since April 2010, led by Vancouver, Toronto and Victoria, the Canadian Real Estate Association said last month.
Read the full article here.
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Saudi excess oil supply is a myth: Rubin
Brent crude rose back to two-and-a-half year highs Wednesday because of the Libyan conflict. But author and economist Jeff Rubin tells BNN the spike in the price of oil may just be the tip of the iceberg.
Rubin says reports that producers in OPEC, particularly Saudi Arabia, will able to cover a shortfall in oil production from Libya are greatly exaggerated.
Read the full article here.
Brent crude rose back to two-and-a-half year highs Wednesday because of the Libyan conflict. But author and economist Jeff Rubin tells BNN the spike in the price of oil may just be the tip of the iceberg.
Rubin says reports that producers in OPEC, particularly Saudi Arabia, will able to cover a shortfall in oil production from Libya are greatly exaggerated.
Read the full article here.