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8 ^# g2 T8 Y- y6 e3 S Thu January 11, 2007 www.edmontonsun.com8 h7 w) T$ S+ Z$ l6 n
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1 k6 [, f7 z K# u+ C4 |Thu, January 11, 2007
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Price is still rightEdmonton Real Estate Board president expects a 15% climb in 2007" d' u8 f# c8 u. }$ B& i
By NEIL WAUGH, EDMONTON SUN) b' q# O+ a; n+ r0 w
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. [9 [, y- F: f; q7 L' qThey're changing the guard down at the Edmonton real estate palace.
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* B u1 T1 B0 _# W$ ^! kMadeline 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. ; ~- i# `+ c6 t9 J1 j
* o* A8 u' |/ w" g2 PBut first, the EREB president's bold predictions and fearless forecasts. - L6 Q' M9 s& X0 N: _- |
, a3 G( f6 f7 vDon'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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: X0 |, C5 }. ]6 m) U'CONTINUED DEMAND'
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"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. ; W2 I- C: w- d; L
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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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9 v$ J+ ~" u- q% `2 V9 X2 f$ x/ |"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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4 i# }; u n( A) Y e) \' ZStill, 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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' u9 I) F, z. E6 |"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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"There are too many shortages in the system," he shrugged.
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6 a$ _' k" N N' w! v: H! ~: s. K( _, B"But it's still going to be very, very strong," he quickly added, with the average new-home selling price ramping up by 20%. 3 ~" o T8 l# V% F8 \6 Q
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NO PRICE BOOM REPEAT
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( i$ j7 Q) ]3 O$ X1 SHe also doesn't see a repeat of the 2006 price boom in the resale market, which he described as "unsustainable." 6 X, p! f% Z$ R( Z$ x
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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. % `2 z5 M! f+ y
- e8 o4 X* d0 x; |) IOver 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. 2 J2 T, s7 j( E# E1 d& m4 p
, ? B' M( k9 uHis 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. + W) q8 ]/ Y& ] W& t4 E
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"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. Q4 b& V% C# ]7 F5 L
" x/ O0 |7 e3 F) }' b0 oYesterday ComFree was still claiming 30% share of the residential market. And "commissions saved" of $82 million from his sell-it-yourself operation. Which, of course, is what the battle is really all about.
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"We do 95% of the sales in the real estate market," Pratt countered. ' m$ B& ?; Q7 o
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Let the good times roll. 1 p2 H/ o& _1 z# Z" ]
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Previous story: Bottom Line
3 Z5 \& L+ E' j7 f$ |1 Z1 N) z ?Next story: Building permits hit record+ e- K+ {& t! {6 ] ^
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