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Thu, January 11, 2007( q; Z9 R9 P5 ~$ i: w
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Price is still rightEdmonton Real Estate Board president expects a 15% climb in 20074 l' _8 P* M( Y9 ~
By NEIL WAUGH, EDMONTON SUN1 U; i/ H, `# J6 X k
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They're changing the guard down at the Edmonton real estate palace. * e8 G, X# E! O/ E. N7 \
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Madeline Sarafinchan is out. Carolyn Pratt is taking over the Edmonton Real Estate Board president's gavel - the kind of blunt instrument that some realtors, I suspect, would like to use on ComFree Edmonton upstart Travis Holowach. More on that later.
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% R8 t) {( Y4 |% RBut first, the EREB president's bold predictions and fearless forecasts. 3 S7 h1 n: q# J8 N: G
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Don't expect a repeat of last year's housing boom where condo and single family dwelling prices spiked an incredible 52%. Pratt is now calling for a more modest increase of 15%.
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2 ?" _- R! x; a* R; g8 r. b9 M' ['CONTINUED DEMAND' 1 u) \; f, P/ J
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|2 K1 ~! [- c) o1 P' m. c"We feel the increase will come because there will be continued demand, consumer confidence, a very robust economy and low interest rates," Pratt whooped at the EREB's New Year's kick-off conference at the Westin. "All the factors are there for another terrific year."
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) t0 q/ L. F0 N5 fShe predicted that the total number of residential sales isn't expected to increase in 2007 - despite thousands of pot-of-gold seekers still flocking to the capital region from across the country as Ontario continues to sputter.
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"There just won't be enough houses to sell," she sighed.
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Canada Mortgage and Housing Corporation senior analyst Richard Goatcher was also talking a good-news-bad-news scenario at the board meeting.
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. L# j, P7 R, v- T3 ^% b. _"The big issue is, are we going to see continued in-migration into the city with the volumes we had last year?" Goatcher said. His expectation is "somewhat less." $ X. o7 I* U" b0 X5 X7 O5 V) l5 g
, ], K* ?- g9 V9 t) `Still, total new-house starts will be "fairly similar" to last year's pace. 2006 turned out to be a record year. So was 2005. But Goatcher is predicting a 5% decrease in house starts. 2 Q2 j# h; b. @8 {% E
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"A lot of it is due to capacity issues," he said. Developers are running out of serviced lots in some areas. Some homebuilders "got a little overstretched" during last year's house-building frenzy.
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2 y: Z( |0 c% b% {- l"There are too many shortages in the system," he shrugged. 4 [. I1 n' v+ S) c
3 l- e- w+ T: ?& u/ `" Y"But it's still going to be very, very strong," he quickly added, with the average new-home selling price ramping up by 20%. 9 m: ~* i* J! |) M2 x% }
: l6 F% a7 O, ?& g/ o t0 _, n8 nNO PRICE BOOM REPEAT 9 a! J4 M" I; N; D! g8 j
, G( O* S# h9 U, v1 j$ x% \) SHe also doesn't see a repeat of the 2006 price boom in the resale market, which he described as "unsustainable." : m% k% u3 c4 O2 b: D2 @% |9 Y( B- h
- ?' e- ~; f7 VExpect a more gentle 10% increase - mainly because many potential buyers are now being priced out of the market - even with zero down payment and 40-year mortgages. $ H( N0 E3 r y' ?) l' J
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Over at ComFree Edmonton, president Travis Holowach was also celebrating what he described as a "steaming red hot" real estate market, and another "record-setting" year for his commission-free real estate service. ; s; e7 l7 L) P0 Y9 s& B4 N4 d% T
. N1 c3 a; p8 mHis 2006 wind-up report shows 4,375 total sales and 5,721 new listings, up 74% from 2005 - clearly sucking up a lot of the inventory that would otherwise have gone to an EREB realtor.
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"Our growing presence in the marketplace is having a strong impact on the competition," Holowach winked.
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, d" w' u+ D5 d) W. E2 m( c; ]So strong that the Alberta Real Estate Association launched a complaint with Alberta Government Services claiming ComFree was bending the truth about its market share. ) {0 B) S3 N! l/ y
/ E- Q1 O0 H9 u' }) CYesterday ComFree was still claiming 30% share of the residential market. And "commissions saved" of $82 million from his sell-it-yourself operation. Which, of course, is what the battle is really all about.
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"We do 95% of the sales in the real estate market," Pratt countered. 9 r7 o1 ]; N, D, `
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Let the good times roll. 7 m. A2 T. k% g2 |: P
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