January sales are off to a brisk start, up almost double from the same period in December and better than the first two weeks last January as well. The number of pending sales suggests that January will also end up on a strong note. In the meantime, the number of active listings is less than 100, the first time we’ve seen that since 2007 I think. It appears that 2014 could be the year that the Sylvan Lake market returns to balance and potentially a Seller’s market.
That points to rising prices and more demand for new construction – all good for the local economy. A stronger US dollar and warm spring may even help bring the cottage market back to life as some of the discretionary money that’s been moving to warmer US climates may decide to stay home.
Building Permits Remain Strong – Todd Hirsch, Chief Economist, ATB Financial
Construction activity is one of the pillars of Alberta’s economy. It provides amply employment and boosts gross domestic product. Judging by new data on building permits, that activity—and the spending that comes along will it—will continue through 2014.
Building permits issued by municipalities and counties are an excellent indicator of future activity (a “leading indicator” in the language of economists) because they must be secured by the builder prior to any construction starting. They represent what builders plan to spend in the coming months. According to Statistics Canada, $1.47 billion in building permits were issued in Alberta in November (seasonally adjusted). That’s down from the $1.5 billion issued in October, but permits are 17.0 per cent higher over the most recent 12 months compared to the previous.
Residential building permits dipped to $875 million in November—the second consecutive monthly decline—but they are still well above levels over the last several quarters. This was partially offset by an increase in non-residential permits to $590 million.
Alberta to Open India Trade Office – Todd Hirsch, Chief Economist, ATB Financial
Alberta is expanding its international horizons with the opening of a trade office in India. Premier Alison Redford will open the New Delhi office during a trade mission this week. While not the same economic powerhouse as China, India is the world’s second largest country by population and a potentially huge market for Canadian exporters.
Over the last ten years, Alberta’s exports to India have averaged close to $100 million annually. Data are available only for the months of January to October of last year, but based on these ten months (down 12.2 per cent from 2012) total trade for the entire year should be close to $103 billion. Relative to the $83 billion (with a B) that the province exported to the United States in 2012—and the $96 billion to the entire global market—trade with India is tiny. It represents about a tenth of one per cent of Alberta’s total exports.
However, with a population of 1.27 billion (also with a B), India is a potentially huge market for Alberta. Traditionally the largest exports to India have been agricultural products—notably dried peas, which account for nearly half of Alberta’s total exports to that country. Other significant exports include polymers of ethylene and, surprisingly, radio navigational aid apparatus.
The one thing not on the list of exports to India is crude oil but that may change in the coming years. Potential pipeline projects to move Alberta bitumen to tide water at either Kitimat, British Columbia, or Saint John, New Brunswick, would open up that possibility.