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Thu, January 11, 2007$ [" a! r( w8 }& ] y; J2 @
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Price is still rightEdmonton Real Estate Board president expects a 15% climb in 2007
6 w- N# ^# L- q" Z& z( \5 LBy NEIL WAUGH, EDMONTON SUN0 |: i( l8 I9 s# z
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% |# _4 y/ Q& D$ k. [% S8 {They're changing the guard down at the Edmonton real estate palace. ( T$ |' {4 |+ J# {! e6 ]
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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. * }1 r7 a2 V; m& b9 R% K2 B6 Q
0 Y I6 `( R3 o$ q5 p) ?9 R& PBut first, the EREB president's bold predictions and fearless forecasts.
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- W, k/ B. q* E! z% A( W+ gDon'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%. . C' J, x2 ?3 n3 t# j/ u. P
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( D1 ]: {' S- T* v$ \"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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' z0 K# ]; N" G$ LShe 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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! n7 t% i& I& @% t! J7 `"There just won't be enough houses to sell," she sighed. 9 S: x- u( G2 `. O! I- [
: Q6 F& Y/ {2 v9 tCanada Mortgage and Housing Corporation senior analyst Richard Goatcher was also talking a good-news-bad-news scenario at the board meeting. " ^! q( q0 a: n0 s n1 k% I* I7 X1 s
8 Q7 Y( b4 O. Q0 b% Z, d0 T: ^"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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"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. 6 R* l7 `8 R4 I. q
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"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%. 6 _: Y; B5 o: |8 r% Y
% U7 C0 {2 ?) M+ k" g6 X% zNO PRICE BOOM REPEAT / l# b+ }) \3 S4 x4 C+ g
6 ?3 P- u! q! \! f% v7 R! H6 tHe also doesn't see a repeat of the 2006 price boom in the resale market, which he described as "unsustainable."
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/ @1 c/ C$ a( t5 x+ _9 i- XExpect 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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4 H7 G6 B3 [( w2 o/ B o' w5 {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. 3 c1 Y& B2 F8 z, d, m
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"Our growing presence in the marketplace is having a strong impact on the competition," Holowach winked. . m% u" E# N( X% N) ]
$ E& L0 ?. |) R" Y# u" iSo strong that the Alberta Real Estate Association launched a complaint with Alberta Government Services claiming ComFree was bending the truth about its market share. 1 Y" ~' p+ u% p" T4 T' n* i+ g
7 v0 j3 R& f0 S; Z8 P5 @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. ) g) @# W% v5 r2 {8 \
/ b, N/ z* E% C5 e& T/ B+ N"We do 95% of the sales in the real estate market," Pratt countered.
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/ J% [" l2 t6 l2 D M5 eLet the good times roll. 0 b, b X/ B j* w1 u
9 H# i5 v% J9 VPrevious story: Bottom Line0 p1 S9 q5 i+ t, a2 i, |9 h
Next story: Building permits hit record9 h; n! T2 V; r }# X
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