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Sun, November 4, 2007
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Rent crunch to worsen
5 D! _- u& K# r0 dVacancy rate forecasted to dip to under 1%
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By KEVIN CRUSH, SUN MEDIA/ M5 p8 B% l6 Y- X1 C) h
" E6 @; }* a7 P* rThink the rental market is tight now? Just wait until next year. 5 g' ]0 U' ] I: Q; M+ c, \
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That's when the apartment vacancy rate in Edmonton is forecasted to dip below the current 1% - making it that much harder for already frustrated renters to find a place to live.
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"It's just getting retarded," said Jasmine, who asked her last name not be printed. 4 c5 |( F' o% H
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SIX MONTHS LOOKING [* j: z0 s8 T
9 S2 O* U p' k" b6 DJasmine said she's already spent more than six months trying to find a decent place for her and her fiance to rent with no luck.
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For now, the couple has been living with her brother and mother in a three-bedroom government-subsidized housing unit.
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4 y& c* T, `) gThey have been scouring the city for anything - but have found nothing in their price range, around $1,100.
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1 d0 g2 ^1 c8 Q* N; I+ P# J"I graduated from college, but I'm still working two to three jobs just to supplement the rent payments," she said. & G% K, a V A# y4 y% C
7 z* M& @1 y) {5 w1 QAccording to new numbers from the Canada Mortgage and Housing Corporation (CMHC), the apartment vacancy rate for Edmonton is a minuscule 1%. ! d! a" @& V: ~" Q# E& m! w6 Y0 V
9 Q: b2 s8 o0 _3 |2 UThe rent crunch isn't expected to get any better with the agency pegging the rate next October at just 0.8%.
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1 h7 M+ {% r: D9 s8 B. EA limited supply of new rental buildings is keeping the market tight, according to the CMHC's outlook for Edmonton, released this week. Apartments being converted into condos is further keeping a stranglehold on renters. / y: S8 A/ m1 D" Z
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Rates are staying high with the average rent for two-bedroom apartments at $950 a month, up from $877 a month in October 2006. 8 S0 p5 Q/ b; k( S
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"With the rental rates being so high, you can only do so much," said Jasmine. 1 i8 s. I/ l3 ^. M3 O* x0 Q. e3 r
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Making it worse, she has pets, and few places accept animals.
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7 B1 P4 \' M2 [! k, r2 u C6 V4 i: u5 JMeanwhile, house sellers are facing a crunch of their own.
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' S) C' f' v4 i3 v# g; Z( s' VWith a growing inventory, high prices, and wary buyers, houses can be on the market for months. The CMHC predicts listing periods will get even longer in the new year. $ K- F2 N: |5 y) L+ _3 s8 }7 p
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"It's been slow," said Alana Schulte, whose Goldbar home has been up for sale since June.
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! }8 Z+ f$ h5 H0 w6 G, w"Shoppers are shopping around a lot more now. They're taking their time. I have had one couple who have come in four times now, but they're not in any rush to make an offer." ! J# U$ i2 ]% i O$ D/ l7 l& x
7 g# `+ ]3 F6 Y" Z2 ?; T3 }+ COriginally listed at $450,000, in late August, she dropped her price to $400,000 to entice buyers. So far, there have been only lookers.
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! t0 ?1 v6 m) r6 z8 wSchulte bought the house for $165,000 less than five years ago. & o9 `5 ^! w7 i& y/ y
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Home prices skyrocketed because of investors buying up properties, said realtor Abe Hering.
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INVESTORS A HUGE FACTOR
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"The investors were causing the market to spiral." 3 ^6 q0 u3 f! _/ J; K+ ~
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Those investors have left the market, leaving mostly people looking for a home to live in. ) n6 S$ `3 X* J
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Hering said there's just not enough of them to cause a real frenzy and they're often nervous about the high prices.
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+ H Z6 r+ k" N8 NThe Edmonton Real Estate Board recently reported the average single-family home in Edmonton sold for $399,555 in September, down 1% from the previous month. |
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