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* x2 C& G% d" S9 j+ {. J' ? Thu January 11, 2007 www.edmontonsun.com$ M5 e) x& v9 t( c r
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/ Y. n- X& M( T' f- yPrice is still rightEdmonton Real Estate Board president expects a 15% climb in 2007
0 g3 S* y2 p- W OBy NEIL WAUGH, EDMONTON SUN
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: V# k2 n3 Y% x7 X' f1 LThey're changing the guard down at the Edmonton real estate palace. & u9 {3 y7 j/ }, V7 o. x
, g( f" w9 Y# u( N, |* W; f, zMadeline 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. " a' u" l6 @& K
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But first, the EREB president's bold predictions and fearless forecasts.
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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%. : Z* c( T4 I) |8 H! j5 r
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6 \% z( \9 l z; ^4 U) t"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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She 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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0 Z: m) u# {# b"There just won't be enough houses to sell," she sighed. ( M" X: \9 d8 b1 X; V! T; ~! Y- j0 T
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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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+ t6 @2 Y* O' w7 `9 A"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." ( S3 G: Q( p1 D& D9 H' x8 a' H
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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. 7 o& _* k, e. d7 l7 n W
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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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; C/ e7 O: |$ s0 k, _* ~"There are too many shortages in the system," he shrugged.
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"But it's still going to be very, very strong," he quickly added, with the average new-home selling price ramping up by 20%.
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/ n* z" `4 z& a$ f' ]He also doesn't see a repeat of the 2006 price boom in the resale market, which he described as "unsustainable." 3 D+ q) U! z9 N. a7 `
9 S b v9 d7 K- NExpect 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.
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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.
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9 @* r: x4 `7 O4 p9 Y& t& r1 Y( E* {His 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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, \( q# t& A' A. R( J"Our growing presence in the marketplace is having a strong impact on the competition," Holowach winked.
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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.
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% b/ W4 I+ |" {Yesterday ComFree was still claiming 30% share of the residential market. And "commissions saved" of $82 million from his sell-it-yourself operation. Which, of course, is what the battle is really all about.
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"We do 95% of the sales in the real estate market," Pratt countered. 0 `* Q& x1 N& r. S
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Let the good times roll.
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$ ]3 ?2 f6 q+ W/ i. j" Z: ?Previous story: Bottom Line5 ]) |- @ S7 u/ j
Next story: Building permits hit record% c7 w) W* t0 H, S
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