As of April, 2013, Windsor has become the hottest real estate market in Canada!

Here is yet another economist citing the prosperous future Windsor can look forward to. The one thing he doesn’t seem to realize is that Windsor is considered on the cutting edge of “on the job training”, literally boosting programs by a hundred people a year. Note his observations on economic stability; increased economic stability to you is increased safety of investment. So if you accidentally buy an average or below average income property (the best properties rarely suffer), the condition of the economy will affect you a lot less.

Broken record time: as an investor you should only be listening to economists for the health of a potential investment area for you. Crazy Uncle Larry that lived in Windsor for 3 days back in 1962? Not so much

My Money: Windsor’s long road back

“The seven lean years are over.”

So begins Benjamin Tal’s economic forecast for Windsor.

CIBC World Markets deputy chief economist says the indicators the bank uses to measure the economic health of Canada’s 25 largest cities show Windsor, a laggard for the past four years, picking up momentum in the last six months.

Tal was in Windsor this past week to give local CIBC clients his analysis of markets around the globe.

“What’s happening here is very related to what’s happening in the global economy,” he said during an interview.

Tal recalled coming to Windsor in 2009. He saw shuttered factories, for sale signs everywhere and an air of gloom hanging over the city. When he popped into a coffee shop he was surprised to find it crammed with customers.

“After a while I realized most of them were there because they didn’t have anything else to do,” he said.

That’s not what Tal saw this week.

“Windsor I see almost as a case study of an economy that experienced a shock…. I think this city was able to take advantage of the shock and be a stronger city,” he said.

According to Tal’s assessment the economy is 25-35 per cent more diverse than it was in 2006 when the auto industry started skidding sideways.

“That’s a very important change,” he said. “Only in a crisis can you make that kind of change because when you’re not starving you can’t change.”

The auto industry is still critical to the city and thanks to American consumers, who are once again spending, Windsor is picking up steam.

Tal expects that will help give a nice 2.5 per cent boost to the value of all goods and services produced in the city this year over 2012.

Those gains have come with the unemployment rate still stubbornly stuck at just above nine per cent.

“This is the reality in the labour market as a whole,” said Tal, who has studied which jobs are in demand and which are on the decline.

“There is a labour mismatch in the city, as there is elsewhere, which means we have people without jobs and jobs without people…. We have to close that gap.”

Companies need to do more on-the-job training, Tal said. “Many CEOs will tell you they’re not in the business of training people, they’re in the business of making money for shareholders. This is something we have to change.”

The long-term health of companies and the economy depends on it, he said, but it is not an easy puzzle to solve.

Young people also need to be made aware of which skills are in demand before pursuing post-secondary education and training, Tal said. They will have to be more self-reliant than their parents when it comes to earning a living and saving for retirement.

“The labour market of tomorrow will be a more exciting place but also a more competitive place…. I predict in the next few years self-employment will be the largest growing sector of the economy,” he said.

That entrepreneurial, creative spirit has been raising its head across Windsor and Essex County of late. Its resilience will be critical in determining the region’s fate in the next seven years.

I don’t need to say much more. One of the very, very top economists in Canada has said it all in a nice, neat summary that any investor can quickly digest. If you’ve been thinking of investing in Windsor, print out this article and tape it to the front of your “Windsor” file. It’s all you need:

Windsor on the mend, says economist

Windsor is a city on the mend, says a CIBC deputy chief economist who believes the area’s impressive job growth — 5,400 more people working in November 2012 compared to one year earlier — is evidence “the worst is over.”

“If you look at employment it’s actually fourth in the country (in a ranking of Canada’s 25 largest cities) in terms of rate of growth. It’s hard to believe, but that’s really the case,” Benjamin Tal said Thursday following the release of his Canadian Metropolitan Economic Activity Index rankings.

Windsor’s overall improvement is modest, moving from 23 last year to 22, beating out only Saint John, N.B., Sherbrooke, Que., and Sudbury. But based on the improving employment numbers, the diversification of the economy, the reviving auto industry and other economic factors that go into the index, Tal believes Windsor will be moving higher in the rankings in the next year or two, probably to the middle of the pack.

“I think you went through long-term pain and now the long-term gain is at the start of the process,” he said, predicting that Windsor’s unemployment rate — now the highest rate among Canada’s major cities at 10 per cent — will begin to drop.

The reason the metropolitan Windsor area can maintain a 10 per cent unemployment rate while the number of people with jobs rises from 150,100 to 155,500 is that 4,600 more people entered the labour market. Primarily, they are people who left the area during the last five years who are now seeing improved job prospects and returning, according to Donna Marentette, executive director of Workforce WindsorEssex.

Many construction workers are returning for work on the Herb Gray Parkway project, she said, “and we are finding that to be the case in other sectors” like manufacturing and tool and mould.

“We know and it’s a fact, Windsor’s first in (a recession) and Windsor’s first out, and I’ve been saying for the last year-and-a-half to two years, we’re coming out of it, we’re going to be strong.”

The optimism Tal has for Windsor is not surprising based on what Windsor-Essex Regional Chamber of Commerce president Matt Marchand is hearing from his members.

“We had a very significant downturn in the economy and what you’re seeing now is the rebound,” he said, citing several automotive suppliers who are going “24-5, 24-6 or 24-7″ to meet demand.

In addition, an initiative to attract retirees to the region is reaping benefits — more than 800 newcomers buying $250 million worth of real estate.

Marchand said Windsor also has: a “very strong, but relatively under-the-radar tech sector that does very, very well”; auto firms that are busy because the average age of a North American car is now 10.8 years and due for replacement; many firms that have diversified away from automotive dependence; and a revived tool and mould industry.

Marchand said there is even hope of a new sector entering the area. Recently, there’s been some oil infrastructure firms — who supply equipment and expertise to the oil and gas sector — kicking the tires in Windsor, he said.

But Tal cautioned that Windsor is by no means booming. “You’re starting from such a low base, so I think the direction is on the up.” He said the rise up the list will be relatively slow. “Remember, you’re going against Western Canada, they don’t have to do anything in order to boom,” he said. Atop the list is Toronto, followed by Calgary, Regina, Winnipeg, Saskatoon, Edmonton, Ottawa and Vancouver.

Windsor ranked in the middle when it came to the percent change compared to a year earlier in average house prices, non-residential building permits and house sales. It was closer to the bottom in consumer bankruptcy rate (20th, with about 24 per 10,000 people), business bankruptcy (20th, with three per 1,000 businesses), population growth (23rd, with a 0.4 per cent increase) and the percentage of employed people who are full-time (last, with 78 per cent).

The only cities to beat Windsor in job growth were Saguenay, Que., Saskatoon and Edmonton.

Tal said he believes Windsor has accomplished the structural changes necessary for a sustained economic rebound.

“It was in negative territory for a while. Now it’s in the positive, showing some momentum.”

It’s part of a steady improvement and overall economic trend that is expected to continue next year, CMHC says in its fall market report

The vacancy rate in the Windsor census metropolitan area dropped to 7.3 per cent in October from 8.1 per cent a year ago. As well, the average rent for a two-bedroom apartment has gone up 1.7 per cent over the last year to about $770.

“Increasing employment levels, a return to population growth and high levels of international post-secondary student enrolment have contributed to an increase in rental demand,” said Margot Stevenson, CMHC market analyst for the Windsor area.

Currently, just under 2,000 international students attend the University of Windsor, an increase of 9.3 per cent over last year. There is a growing demand for schooling abroad and Windsor is in a good position to respond, said vice-provost Clayton Smith, who is responsible for the university’s international students.

The city is becoming known as the university markets itself in other countries, he said. “International students are making Windsor a destination.”

The decrease in Windsor’s rental vacancies was concentrated in neighbourhoods around the university and St. Clair College campuses, says the CMHC report.

An improved employment rate for 15 to 24-year-olds is also giving some the stability to move out on their own, it says.

The lowest vacancy rates are on Windsor’s east side, where there were no apartments with three or more bedrooms vacant. This part of the city is popular with immigrants and also has some of the best managed and maintained rental units, the CMHC’s Stevenson said.

Pulling up Windsor’s vacancy rate are some older, poorly maintained units, she said. “So it’s too bad it gets a bad rap.”

Windsor is coming back gradually from 2008, when the rental vacancy rate was 14.6 per cent. It is also bucking a national trend of increased rental vacancies. Still, the city’s rate remained the second highest of 35 major Canadian cities surveyed by CMHC. St. John, N.B., had the top rate of 9.7 per cent.

The average vacancy rate for Canada’s 35 major cities increased to 2.6 per cent from 2.2 per cent a year ago. The lowest rates were in Regina, at one per cent, Thunder Bay, at 1.1 per cent, and Calgary, at 1.3 per cent.

Ontario’s average vacancy rate stood at 2.5 per cent in October, up from 2.2 per. Most of the provinces urban centres had higher vacancy rates, except for Windsor, Peterborough, Hamilton, London, Thunder Bay and Sudbury. London’s vacancy rate was 3.9 per cent, almost unchanged from a year ago.

The national average rent for a two-bedroom apartment was $901 a month. The cost was highest in Vancouver, with an average rent of $1,261, and lowest in Saguenay, Que., where the average was $549.