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3 Canadian cities top best long-term real estate investments list

Long term real estate investment

A report by United Kingdom-based Grosvenor Group named three Canadian cities as among the best 50 cities in the world to invest in real estate for the long term. The three are Toronto, Vancouver and Calgary, which garnered 1st, 2nd and 3rd places.

The seven other cities in the top 10 are Chicago, Pittsburg, Stockholm, Boston, Zurich, Washington DC and Atlanta.

In listing Toronto as the top city, the report said, “The investment of city leaders in infrastructure and its commitment to upgrading it over the decades has put Toronto at the top of Grosvenor’s list of the world’s most resilient cities.”

Grosvenor, a centuries-old real estate company based in London, said the rankings is not based on short-term metrics such as return on investment, but on their longer term resilience. It combines low vulnerability and high adaptive capacity.

It also took into consideration the ability of the properties to rise about the cyclical ups and downs of the real estate market.

Grosvenor said that the three Canadian cities have a high level of resource availability and are well governed and well planned.

Richard Barkham, group research director and economist of Grosvenor Group, noted the great deal of economic dynamism in the three cities, pointing out, “In the round, Canadian cities – and Toronto in particular – are exceptionally good real estate destinations in the long term.”

He explained that many investors merely look at properties based on short-term risk and return on investment. Barkham said people must look beyond those benchmarks and view cities holistically in terms of the ability to adapt and improve.

The report said the cities popular with investors like New York and London do not necessarily protect capital in the long term.

He said short-term issues such as transit problems in the Greater Toronto Area, speculations of a Canadian housing bubble and even Toronto Mayor Rob Ford’s bad habits are local issues and characters that create problems in a very short-term sense.

On the opposite end, the report said the weakest 20 cities are in emerging markets, with 8 in the BRIC countries. The bottom five cities are Dhaka, Jakarta, Cairo, Manila and Mumbai.

The report explained, “Their vulnerability derives from inequality, poor infrastructure provision and environmental degradation, and, to a less extent, climate vulnerability.”

But the report added that in ranking cities, Grosvenor recognised each place is on a journey, “some moving more rapidly than others towards prosperity and livability and each with their own constraints.”


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