Posted: Feb 2, 2007, 8:56 PM
Join Date: Jun 2006
Location: Saint John :: NB
Published Monday January 29th, 2007
Appeared on page C6
Energy boom seen as good news for Valley
The city's rosy economic future with a possible second oil refinery is casting its glow beyond the city limits.
Officials in the Kennebecasis Valley are optimistic about the economic spinoffs for their community if Saint John's energy boom continues.
Quispamsis Mayor Ron Maloney anticipates his town will be a popular destination for newcomers to the area who are looking for homes.
He predicts that a strong demand for housing in the Valley will push up property values, which will, in turn, increase assessments.
That eventually means a strong tax base for the town and higher assessments for new and existing properties.
Just how many tax dollars it will mean will depend on whether certain large-scale projects proceed.
Construction industry leaders have predicted that the Saint John area will need 2,000 more workers in the next five years just to maintain the status quo.
Projects such as the LNG plant, the refurbishment of the Point Lepreau nuclear generating station and the possibility of a second oil refinery will mean thousands more will be needed.
That's all good news for Saint John's bedroom communities, which have already been experiencing a bit of a boom.
Rothesay saw more housing starts in the first three-quarters of 2006 than in all of 2005, which was considered a banner year for development.
Although housing starts in Quispamsis were down last year from 2005, the general trend has been increasing, said Maloney.
He estimated the town saw roughly 150 new housing starts each of the last few years.
The entire Saint John area is already seeing an increase in selling prices for existing homes.
The average selling price increased by 7.1 per cent in 2006 over 2005, according to statistics obtained from the Canadian Real Estate Association.
Todd McAdam, a real estate agent with Royal LePage Atlantic's Rothesay office, said the Valley market has been experiencing a steady increase in home values as a result of "a bit of a buzz in the real estate market."
He anticipates values will continue to increase as the talk of energy-sector development continues.
As workers are lured back to the Saint John area, they'll be looking for homes all over the Saint John area. Eventually, depending upon the scope of the energy boom, the demand for housing will exceed the number of houses available, said McAdam.
He said what is already a seller's market will only get better for sellers.
"The foreseeable future looks very good, especially for the housing market," he said.
Maloney said his town is ready for the boom and everything it could bring to his community.
"With all the projects going on, we see another boom coming in the next few years. Cautious optimism, we might call it," said Maloney.
He said the town has already made expensive investments in its water and sewerage systems and has always tried to prepare for future development. While a massive influx of new development would still require a lot of infrastructure work, the increase would result in higher assessments and an expanded tax base that could help pay for the work.
Maloney is hard-pressed to come up with negative impacts of a flourishing housing market in the Valley.
Perhaps, he said, if all the talked-about projects become reality, then the Valley might experience some traffic congestion.
"Maybe if it took you 15 or 20 minutes to get to work before, it might take you 20 or 25 minutes," he said.
But then again, commute times and congestion are all relative, he pointed out.
After all, a 25-minute commute for someone who works in Toronto is nothing.