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- m3 n; b7 r3 F Thu January 11, 2007 www.edmontonsun.com# a) q; n- o; Q5 F+ j8 w
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Thu, January 11, 2007
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Price is still rightEdmonton Real Estate Board president expects a 15% climb in 20070 N9 M6 e1 b( q: I. }
By NEIL WAUGH, EDMONTON SUN# j( n% B C- x% e2 m1 O9 h# ^
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They're changing the guard down at the Edmonton real estate palace. : F" K& K7 x( {. O+ b* b4 C
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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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But first, the EREB president's bold predictions and fearless forecasts.
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. B# M3 k, H$ d& |0 FDon'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%. 8 x/ g* D) |% X3 ?: u7 A' F: [9 g
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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.
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"There just won't be enough houses to sell," she sighed.
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5 \9 H9 M9 R( Y0 Z) ^+ yCanada Mortgage and Housing Corporation senior analyst Richard Goatcher was also talking a good-news-bad-news scenario at the board meeting. 8 s$ N, R( h: \6 ]) Y R# m1 z
: ~- D* i9 N# s' Z1 @! U"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.
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"There are too many shortages in the system," he shrugged. % ]% |# y* J( e( v; @- v# C Z
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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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NO 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."
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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.
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1 \ {' G& ^4 P6 mOver 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. 3 \* W# R) K8 n( i% v. w! F/ P) L; p7 d: A
$ O* i( z: m8 f! ?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. m- |, j1 E# N& W* a) M$ Q9 d
+ x L' X' u! y$ z) Q1 t7 t"Our growing presence in the marketplace is having a strong impact on the competition," Holowach winked. - I1 X2 W4 R# T6 z
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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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5 [* V w" Z4 p6 uYesterday ComFree was still claiming 30% share of the residential market. And "commissions saved" of $82 million from his sell-it-yourself operation. Which, of course, is what the battle is really all about.
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5 K% u0 [7 u$ r9 \8 p"We do 95% of the sales in the real estate market," Pratt countered. + @2 i( P2 h8 X( `% y$ u2 K; l
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Let the good times roll.
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. Q/ T m( `5 Q( ^Previous story: Bottom Line
$ {7 z- c+ A- v0 r8 A7 w% b. cNext story: Building permits hit record
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