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Thu, January 11, 2007
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, h; U. @, z e+ {4 p! F2 X( X/ g7 VPrice is still rightEdmonton Real Estate Board president expects a 15% climb in 2007! J. `: S5 Y% R. Q- N1 c8 W
By NEIL WAUGH, EDMONTON SUN
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They're changing the guard down at the Edmonton real estate palace.
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( ^5 ^1 y% p* m8 uMadeline 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( } D4 H1 Y! `
8 D9 g4 y) B) L9 rBut 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%.
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'CONTINUED DEMAND' . I; T f. W) T# f i
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6 v: ~% |! x- n. }* Y"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." 4 ]( m% m) Q2 c2 l! ^
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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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"There just won't be enough houses to sell," she sighed. w, n k- [* h' i: s
9 u9 B$ }- d! v' K! X6 l) a5 d& GCanada 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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"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."
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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.
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6 b N. j" B( a9 |$ W& _2 f"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. - b) _- p3 G* P" ^
1 A& ?0 I& d" S( y"There are too many shortages in the system," he shrugged.
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( ]6 ~2 {+ {2 ?( S, |"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 u+ b' t$ x1 d7 i9 o, c3 Z% P
~5 g; s6 l ^2 P. h$ j F' oNO PRICE BOOM REPEAT
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He also doesn't see a repeat of the 2006 price boom in the resale market, which he described as "unsustainable." $ o" ?. t# l) D: b4 K
* G x/ H2 a" n0 {Expect 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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( A% F" F8 d6 ?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. ; Q* J& v5 ]7 L
$ u- I8 s/ v# l3 C6 X' p. KHis 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. ( a4 ]' s$ ?2 \
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"Our growing presence in the marketplace is having a strong impact on the competition," Holowach winked. 3 p. ?# g2 p9 e+ E2 j7 @5 L* ~0 o
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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. ; A: S( a& X& u( f; ?
7 P3 I3 g8 V4 c+ t7 y$ ?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. % @' T. X' }8 ]! r2 m+ X
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"We do 95% of the sales in the real estate market," Pratt countered.
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Let the good times roll. / J4 z9 W; @* ^+ R8 f
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Previous story: Bottom Line
j" [) U6 f' {1 h3 `9 x1 HNext story: Building permits hit record
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