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Real Estate in the News Please refer to the listed source for complete article information. --- ---
--- The REALTORS® Association of Edmonton reported a record number of single month sales of residential properties for the second month in a row. Buyers who created record sales in June carried through for a record in July as well. Although sales were off almost 11 per cent from June, the total number of July sales was 2,277, creating a new July record. "The market is stable and strong sales and market activity are not driving prices up dramatically," said Charlie Ponde, president of the RAE. "Attractive mortgage rates and consumer confidence are powering the local market." --- Edmonton's office market will see vacancies climb as tens of thousands of square feet come onto the market from downsizing firms, says a commercial real estate broker with Avison Young. Edmonton's vacancy rate jumped 2.2 percentage points to 7.5 per cent from mid-2008 to mid-2009, according to an Avison Young report released recently. But the vacancy rate is set to increase as 109,000 square feet comes onto the market from Telus House (formerly called TELUS Plaza South) and Sun Life Place. Telus plans to put 70,000 square feet of its office space on the sublease market, said said Cory Wosnack, a principal with Avison Young. The Vancouver-based company said it has cut a total of 1,500 jobs this year. Another 39,000 square feet is expected from Sun Life. "This will increase the amount of available space in the downtown market by 0.7 per cent," Wosnack said. --- While the sales stats for single-family homes in Fort Saskatchewan dropped slightly last month to 32 from 35 sales in June, one REALTOR® believes buyers and sellers are far better off than they were six months ago. The 32 houses sold last month is up seven from July of last year, while the average sale price fell nearly $70,000 to $339,000 from the figure last July. While that seems dramatic, one has to consider the average price fell only $14,000 from the average price in June of this year. "Should all of the indicators in the housing market stay consistent, the hope is that the market will continue to get stronger well into next year," he said. --- While numbers for existing homes have been showing signs of recovery, this week both housing starts and prices for new homes took a tumble. "July's tally is comfortably above April's 118,500 low, and when taken in combination with other housing market indicators, it's still safe to say that Canada's housing market is on the mend," notes Robert Kavcic at BMO Capital Markets Economics. "Indeed, building permits and existing home sales have both surged more than 40% through June from their winter lows, a feat that will gradually feed into improved levels of residential construction activity." "Looking out further ahead to next year, we remain cautious, predicting only a modest bounce in activity. After entering this downturn following an unprecedented housing boom, both in terms of length and depth, and faced with a higher inventory of unsold units coming out of the recession, it remains highly unlikely that housing starts could revisit pre-recession levels for years to come," notes Pascal Gauthier, economist, at TD Economics --- Single-Family Dwellings: From August 5 to 11, the City of Edmonton planning and development department issued 42 permits for single-family homes. Areas include Cumberland, Wild Rose, Rutherford and Eaux Claires, Silver Berry and Ambleside. Multiple-Family Dwellings: From August 5 to 11, the department issued seven permits for multiple-family dwellings. Kimberley Homes Ltd. received two permits to build semi-detached houses in Rutherford. --- An astounding rebound in the resale housing market combined with good news out of the manufacturing sector suggests that Canada is slowly but surely digging itself out of recession. CREA reported that 50,270 homes traded hands on the MLS® System in July. This is up 18.2% from a year ago and set a record for the month of July. Although the economy has a long way to go before it returns to levels of growth seen before the recession began, there are many signs that the bottom has been reached, said CIBC chief economist Avery Shenfeld. "I believe that when history is written, we'll see that the second quarter was the last quarter of recession, and the third quarter the quarter that marked the beginning of the climb out of the hole," Shenfeld said in an interview. "Record-low borrowing costs and the mounting sense that the worst of the economic storm has passed are the key ingredients in the remarkable turnaround," wrote BMO deputy chief economist Doug Porter. --- Edmonton helped push Canada's July housing sales to the best on record for the month and the largest year-over-year increase in two years, CREA said. Edmonton-area sales rose nearly 28 per cent with 2,277 resale homes purchased in July, breaking the July record of 1,953 set in 2006 during a heated market. "The difference in the resale housing market now, compared to the beginning of the year, is night and day and nowhere is this more evident than in the West," said Dale Ripplinger, Association president. “Homebuyers recognize that interest rates and prices have bottomed out, and are taking advantage of excellent affordability before prices and interest rates move higher." Seasonally adjusted MLS® System sales have risen for six straight months and are up 61.2 per cent off the decade-low set in January. Sales are only off 1.4 per cent from the May, 2007 peak. --- Canada's housing market boomed in July as low interest rates and improving economic confidence sent sales of existing homes to a record for the month, despite generally weak economic conditions. The remarkable turnaround from an almost frozen market at the start of the year has economists stunned, and while they predict activity will level out soon, the risk is continued low interest rates begin to stoke a house price bubble. "We can't rule it out," Douglas Porter, the deputy chief economist at BMO Capital Markets, said of the possibility of a bubble. But he said the scenario was hard to fathom given the underlying weakness in the economy. Even so, that weakness to date has not prevented a strong rebound in the existing housing market, which declined steadily throughout 2008 and hit a decade low in January. "After improving markedly, affordability will deteriorate in coming quarters, and unemployment will continue to rise," said Pascal Gauthier, an economist at TD Bank Financial Group. "New listings might well start rising again too. Combined, a larger supply and a softening in demand should cool prices in a delayed fashion." --- In July, overall housing starts in the Edmonton region increased over the same time last year. The spike in construction marks the first time there has been a year-over-year increase since January 2008. Early figures released by CMHC show that housing starts in the Edmonton region totaled 451 units in July. That marks a moderate increase over the 407 housing starts in July 2008. Single-detached housing starts totaled 273 units last month, which is a 37% increase over the 199 units that were started in July 2008. So far in 2009, single-detached housing starts across the Edmonton Region totaled 1,390 units, which is a 10.5% decline from the first seven months of 2008. "CMHC expects this trend to continue in the months ahead as builders' unsold inventories continue to move downward," said Richard Goatcher, CMHC's Senior Market Analyst based in Edmonton. --- Canadian commercial real estate transaction volumes from January through June shrunk by 51 per cent, year-over-year, from $10 billion halfway through 2008 to $4.9 billion halfway into 2009, according to a national investment report released by CB Richard Ellis Ltd. Mid-year through 2009, the number of commercial transactions was 1,569, down from 2,542 transactions completed halfway through 2008. Meanwhile, a report by PricewaterhouseCoopers warns that Canada's commercial real estate sector faces "very trying times." That hardship will send some owners into creditor protection as the market corrects from overblown valuations during the last cycle, the report said. During a recession, commercial real estate is one area affected and can feel the impact much longer than other investments because job losses are a lagging indicator as opposed to a leading indicator, said Adam Legge, vice-president and chief economist for Calgary Economic Development. --- For the first time this year, housing starts in Strathcona County surpassed 2008's numbers. Through the first seven months of 2009, there have been 194 housing starts in Strathcona County, compared to 189 through the first seven months of 2008 -- a 2.6 per cent increase -- according to CMHC. In July, 36 housing projects began in Strathcona County, up from the 31 that began in July 2008. According to CMHC, July was the first time since January 2008 that the number of housing starts in the Edmonton Census Metropolitan Area (which includes Strathcona County) surpassed a previous year-over-year total. As a result, 2009 is still trailing 2008's total residential construction starts through the first seven months. --- Manhattan office sales came to a near standstill in the first half of 2009, with less than one-tenth the average number of transactions seen during the same period in the previous five years, CB Richard Ellis Group Inc. reported. Three Manhattan office buildings valued at more than $30 million (U.S.) sold from January to June. That is down from an average of 32 in the first six months of the prior five years. Buyers and sellers are far apart on bids while low interest rates on existing loans mean many sellers can afford to wait, Los Angeles-based CB Richard Ellis said. --- A REALTOR® accused of sexually assaulting three prostitutes was denied bail in provincial court. Oldin Yadir Maldonado, 26, was charged in June with two counts of sexual assault causing bodily harm, three counts of unlawful confinement and one count each of sexual assault, robbery and uttering threats to cause death or bodily harm. Police said members of their sexual assault unit began an investigation after an April 19 attack on a prostitute. "It had nothing to do with his occupation as far as we know," said Jon Hall of the REALTORS® Association of Edmonton of the alleged assaults. Hall said REALTORS® must undergo a criminal background check, and newly licensed agents are fingerprinted. A preliminary hearing is scheduled to begin Nov. 25. --- For Canada, a country that has spent the better part of 20 years nervously wringing its hands over its perceived inadequacies, the dramatic reversal over the past year has been striking. Our banks were once seen as lacking innovation; now world leaders hail the boring Big Five as being among some of the safest and most profitable banks in the world. We fretted that our economy was overly reliant on commodities; now our rocks, oil and gas are seen as a natural hedge against havoc in the manufacturing sector. We worried that Canada's strict mortgage rules were a drag on our housing market; now we can brag that we don't put people into homes they can't afford. Almost any way you look at it, Canada is uniquely positioned. "You'd have to go back to those golden early Trudeau years of '69, '70 to find a time when things were aligned so well," says Glen Hodgson, chief economist at the Conference Board of Canada. Last week the board predicted that next year Canada will see a huge leap in our ranking by international economic performance, from 11th place out of 17 countries in 2008, to fifth. Canada's rise will be driven by GDP growth, improved employment growth and increased foreign investment. --- Despite some of the optimism created by the Bank of Canada's recent assertion that the recession is over and the gains on the stock market, Canadians should be conditioned for less-than-ideal economic news after the greater-than-expected 44,500 jobs lost last month. Millan Mulraine, economics strategist for TD Securities, said the outlook for the Canada's new house market is looking up. “The sharp correction in the Canadian housing market appears to have come to an end, as record-low mortgage rates, affordable home prices, and the various incentives provided under the fiscal stimulus package appeared to have gained some traction and laid the foundation for the recovery in the housing sector,” he wrote in a research note. --- From July 29 to August 4, the City of Edmonton planning and development department issued 22 permits for single-family homes. Areas include Charlesworth, Walker, Silver Berry and Rutherford. The department issued seven permits for multiple-family dwellings. MacLachlan & Mitchell Homes Inc. received three permits to build semi-detached houses in rural West. --- Alberta's unemployment rate rose to 7.2 per cent in July--a high not seen since June 1996, said Statistics Canada, which released unexpectedly grim labour market news recently. Canada lost 45,000 jobs--more than feared. Alberta lost 3,700 jobs compared to June, while the province’s labour force increased by 5,600 in July as jobseekers moved to the province. “The current weakness in conventional oil and gas drilling, as well as the sharp retrenchment in construction and manufacturing activity, has left many companies no choice but to cut payrolls,” said ATB Financial senior economist Todd Hirsch. Job losses in Alberta will only get worse in the next few months, he predicted. --- July was another brisk month for real estate in St. Albert as home sales remained strong and the average price continued to hover around $437,000. There were 101 homes sold in July, a significant increase from the 87 sales posted in July 2008 and 57 in July 2007. The St. Albert market has been outperforming its 2008 numbers by a significant margin since April. Meanwhile, the Edmonton region as a whole posted its second consecutive record-setting month in July. “It's a very good balanced market right now,” said Charlie Ponde, president of the REALTORS® Association of Edmonton. “It's good for the sellers and good for the buyers.” Homes that are well priced are selling quickly right now, with some drawing multiple offers, Ponde said. But there's enough inventory coming on-stream to prevent prices from escalating. --- Some REALTORS® are concerned people buying resale condos might not be getting what they are paying for. --- For the second month in a row, the REALTORS® Association of Edmonton is reporting a record number of sales. A total of 2,277 residential properties were sold in July which is a new record for the month. Last month, 2,552 residential units were sold, which was a new June record. The record-setting July is also note-worthy for the huge increase in sales over the same time last year. July 2009 saw a 27.6% increase in residential units sold over July 2008. “The market is stable, and strong sales and market activity are not driving prices up dramatically,” said Charlie Ponde, president of the REALTORS® Association of Edmonton. “Attractive mortgage rates and consumer confidence are powering the local market and sellers are being realistic about their pricing.” --- Edmonton was on display for an international audience when HGTV aired its latest episode of House Hunters International last night. In the episode, local real estate agent Karen Stanko showed Daniel Ragan, a High Prairie helicopter pilot, around three condos priced between $275,000 and $320,000 in Edmonton’s downtown and helped him pick his new home. Behind the scenes, she took Ragan to about 30 properties before he picked the right one. Viewers, however, will only see him contemplating three of those condos. It also could help give the city a chance to shine. “I really liked having shown the downtown,” Stanko said. “It looks really urban. They also showed a bit of the river valley.” --- Low mortgage rates combined with prices that are significantly lower than two years ago are making the housing market attractive for buyers who’ve been sitting on the sidelines, explained Richard Goatcher, senior market analyst for the CMHC. St. Albert is making progress in becoming a more attractive place for builders and developers after falling behind the rest of the Edmonton region for a number of years, said Mayor Nolan Crouse. One key initiative was a bylaw change that eliminated a restriction on home size on small lots. This has made St. Albert more responsive to market demands, Crouse said. --- Total housing starts in the Edmonton region rose in July by 10.8 per cent compared with a year earlier --the first year-over-year increase since January 2008. Builders began 451 homes in July compared with 407 started in July 2008, according to preliminary figures released by CMHC. While new apartment construction remains depressed, single-detached homebuilders poured foundations for 273 units in July. That’s up 37 per cent from the 199 houses started in July 2008. “CMHC expects this trend to continue in the months ahead as builders’ unsold inventories continue to move downward,” said Richard Goatcher, senior market analyst for Edmonton at CMHC. “Residential construction in Alberta pretty much went to sleep during the first half of 2009 as developers waited for the dust to settle in Alberta's housing markets,” said Dan Sumner, an economist with ATB Financial. Unexpectedly strong sales in existing home markets in Alberta may be boosting new home construction, Sumner said. |
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