W H Y  I N V E S T  I N  C A N M O R E ?

Lifestyle & Activity.

When investing in a mountain vacation home or revenue property you not only want a location that has a strong real estate market, but also offers many outdoor activities, culture, scenery, and is showing strong signs of growth year after year. Nestled in the Bow Valley below the magnificent Three Sisters, Ha Ling Peak and Rundle Mountains, with stunning views in every direction, and only 24 km from Banff National Park, offering any type of service or restaurant you could want between Banff town and Canmore, it's the perfect place to invest in real estate. 

Thriving Real Estate.

Canmore's economy is mainly supported by worldwide tourism which in turn makes it less unstable than a commodity-based economy. In the warm month the town is flush with hikers, back packers, campers, trail riders, water sport enthusiasts, athletes, mountain climbers, while in the winter months the town remains busy with skiers, snowboarders, skidoo-ers, and winter sport enthusiasts. There is no true "slow" season. Because of this the real estate market is busy, thriving and strong. Revenue properties here produce robust profits month after month all year long. 

Freehold vs Leasehold.

Unlike the town on Banff that has restrictions and rules on residency and ownership, most of the real estate in Canmore is classified as Freehold. This means you own the land and the house outright - it's free from hold of any entity besides the owner. Banff real estate is within the National Park so none of the homeowners own the land their property is on but instead lease the land their home is on from the town. While you can purchase a home in Banff there is rules of Eligible Residency that have to be met by the people living in that property. I'm happy to discuss this in more detail if you are seeking a Banff property. 

SHORT TERM RENTALS:
 
Short term rentals are a sought-after and profitable type of investment in the Bow Valley with Dead Man's Flats, and Canmore offering them, however Banff does not allow them. Only certain properties allow for short term, they have to be zoned for that use, and there is a limited supply of them available. Another aspect of this is permitted vs discretionary use, for discretionary use you may have to meet a certain criterion to be allowed to operate. An example of this would be where some buildings may allow for short-term rentals on the 2nd floor of the building but not on the other floors which are left for full-time residents. It's important to know the land use by law prior to purchasing so you are fully aware of what is allowed for your investment. There are two types of short-term rentals, Hotel Condominiums and Tourist Homes which you can get more details about below!
1. HOTEL CONDOMINIUMS:
A very common type of short term rental investment property in the Bow Valley, you essentially buy a hotel suite within one of the many resorts. This option allows you to keep your unit in the hotel rental pool if you choose and the hotel will look after the marketing of the suite, booking your guests when you are not staying there, cater to them during their stay, and clean your suite after they leave. Many investors love the ease of this type of investment, but it does come with a management fee. You may also leave your unit with a short-term property management company, there is a few in Canmore, and each of them offer different management styles allowing you to find your best fit. You can also self-manage using Vrbo or Airbnb which reduces operating costs and increases profits, but you will need to line up your own cleaners and support staff. 
 
*Image provided by solararesort.ca

2. TOURIST HOME:

A tourist home by canmore.ca definition is any dwelling that is used as a permanent residence OR for short term stays. Some of the things that distinguish a tourist home from a permanent residence are: the management or advertising of the home as a "vacation rental" on website like Airbnb or Vrbo., and receiving reservations, deposits and payments

Tourist homes are by far the most sought-after type of investment/residential property but very few residential neighborhoods today allow them. However, they are permitted or discretionary use in most of the commercial and mixed-use districts allowing for a lot of property options. The fantastic thing about a tourist home zoned property is you can choose to live in it full time, part time, rent it out long term or rent it short term. You can self-manage the property to reduce your operating costs, or bring on a management company. Complete flexibility. Having the option to rent your tourist home out to a long term tenant will prove to be helpful when trying to secure financing as Banks love stability and can tend to shy away from Airbnb's and short term only rentals.

VACATION PROPERTY OR PRIMARY RESIDENCE:
 
Getting in to the Canmore or Banff market is not cheap, but the benefits for those looking to live the outdoorsy mountain lifestyle are many. A number of world class ski resorts only a short drive away, the majestic Kananaskis Country outside your door offering hiking, climbing, camping, fishing, kayaking, trail riding, and mountain biking - fresh mountain air, lots of activity and a reduced stress lifestyle. Getting in now means you will watch your investment grow as the years go on, town expansion becomes less, and your value goes up. The mountains that surround this beautiful little town limit the outward expansion, but it does result in an increase of density as we have seen in recent years. 
PURCHASING A LONG TERM RENTAL:
 
With it's super desirable location, very high rent rates, and more than certain long-term appreciation it's no wonder real estate investors flock to Canmore, Banff & Dead Mans Flats. It should be stated that the cost of real estate in Canmore is significantly higher than other cities and towns in Alberta and may not make for the most cost-effective long-term investment. As with anything it will depend on how you go about it, what your intentions are, and what kind of deal I can secure for you. You will pay more in the Bow Valley, rent is very high, and the likelihood of appreciation is very strong. Whereas in Calgary you will pay less for your property, rent will be slightly less, you are vulnerable to market fluctuation, but you may make more in the city for a long term rental investment. 
RENT RATES IN THE BOW VALLEY:
 
For a single person renting in the Bow Valley, the average cost of living runs between 3500-4000 / month. Here is a breakdown of approximate rent rates for 2023 provided by rentfaster.ca in the month of February. Rent rates may fluctuate based on length of the lease, square footage, location, type of residence, and age of property. 
 
- One Bedroom     $1,500 - $2,000 / month
- Two Bedroom     $2,500 - $3,600 / month
- Three Bedroom   $3,700 - $5,500 + / month
FRACTIONAL OWNERSHIP:
 

Fractional ownership is an affordable and excellent way to have a vacation home in the mountains. It is intended for people who want to own a "piece" of a unit and operates on a rotating schedule. Essentially you get to own a mountain vacation home without putting out $500,000.00 + for a condo you may only visit a couple times a year. There is a number of buildings in Canmore that offer Fractional Ownership.

HOW DOES IT WORK?
 

Within Canmore there are specific resorts that offer fractional ownership and have Tourist Home zoning which means the suite can be rented long term, short term, or lived in full time by the owners. It requires this zoning because fractional owners are spending less than a month at a time in the property and the zoning allows for multiple owners on a single suite. You can base your buy in on what best suits your lifestyle which is "typically" 4, 8 or 12 weeks of the year. Some offer more. The weeks are set up on a rotating schedule to ensure all owners get access to prime holiday weeks when it's their turn. You will pay a HOA (Home Owners Association) fee to cover things such as condo fees, taxes, electricity etc. These units are typically managed by the resort management company and if you choose not to use your weeks they can be turned back into the rental pool in order to generate revenue. The rental pool is designed to offset some of the costs of owning in Canmore and can generate you a little bit of income but usually doesn't generate any serious income. However, it may cover your financial obligation to the unit. Banks don't have financing options to cover fractional property but you can get a homeowner line of credit to purchase. 

WHAT THE BOW VALLEY & BANFF HAVE TO OFFER:

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PRIMARY ZONING TYPES YOU NEED TO KNOW:

Residential:
This is the most common type of zoning for buyers looking for a personal residence and includes single family detached homes, triplex, duplex, townhome or condo. You can live in it full time, part time or rent it out on a long-term lease. Residential properties cannot be used for short term / vacation rentals. 

Visitor Accommodation:

This is the typical zoning for hotel condominium suites in which you can have limited use of and can only be used for short term stays. In many of these complexes you are restricted to a maximum stay of 30 consecutive nights and you cannot rent your suite out to a long-term tenant. 

Employee Housing:
These properties are for locals so that they may have affordable long-term housing. You may purchase a home zone for employee housing if you are working in Canmore for a minimum of 20 hours per week. These are not intended or permitted for short-term rentals. 

Tourist Home: 

As we discussed above this sort of property gives you complete flexibility as you can reside in it full time, part time, rent it out on a long-term lease, or use it as a short-term vacation rental, or a combination of the above. This is the most sought-after property type in the Bow Valley and is typically the most expensive. 

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