The Annual 2007 EREB Housing Forecast Seminar was recently held. In attendance were representative from the EREB, lending institutions and Edmonton Economic Development.
The article makes comment on affordability. Here is a quote:
"“There is capacity to increase prices in this market especially if we compare Edmonton prices to Vancouver or Toronto,”
My question to the bloggers, is it fair to compare Edmonton affordability to Vancouver or Toronto, or even Calgary?
The full release:
Above average price increases expected in 2007
Edmonton, January 10, 2007: The Edmonton Real Estate Board forecast price increases for all types of resale homes in 2007. President Carolyn Pratt predicted that prices would increase at least one to two percent a month for an annual increase of 15% this year.
“There is enough strength in the Alberta and Edmonton economy to forecast an increase,” said Carolyn Pratt, president of the EREB. “But to predict the percentage increase is difficult.” Pratt said that despite 52% price increases in 2006, Edmonton housing prices are still below Canadian and Alberta average prices. “There is capacity to increase prices in this market especially if we compare Edmonton prices to Vancouver or Toronto,” said Pratt.
She forecast that prices for single family homes, condominiums and other types of housing will have increased 15% by this time next year. Inventory levels will remain low throughout 2007 and the lack of supply and high demand will drive prices up. Like last year, multiple offers and frenzied buying will probably occur during the spring. However, REALTORS® will work closely with buyers and sellers to meet their needs and the market will calm down in late summer and fall.
Condominiums, which have a lower average price than other forms of housing, will be attractive to first time buyers and will increase market share this year. The booming economy will continue to make personal investments in recreational property possible for many buyers and sales are expected to increase. Land, investments and apartment buildings will continue to sell well but sales of commercial properties and businesses that require staff to succeed may be hurt by the lack of employees in Alberta.
Pratt urged anyone entering the real estate market to work closely with a REALTOR® to ensure they get the best value for their property.
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15 comments:
I don't see how anyone can compare Edmonton to Vancouver or Toronto. Vancouver is land limited, and Toronto is the financial capital of the Canada.
Edmonton prices are based on speculation, and EREB is one of the driving forces behind that.
Does anyone have a link that compares historic costs of home in Vancouver vrs. Calgary vrs. Edmonton?
I'm curious if there are trends (say price increases/decreases in one city 3-4 months before another).
There are several good reports on individual cities on http://cmhc.ca/
One could argue that CMHC is biased becuase they are in the lending game, but I trust CMHC more than the EREB. Plus with Comfree.com taking more of the market share, EREB's data may not fully represent the market.
Uh huh, CMHC can be trusted? Lets see here, they said just 2 weeks ago Calgary prices would go up 37%, with no real explanation as to why. Then they said that the mortgage market (that they have made SERIOUS money from these last few years) will be strong and vibrant as Calgary housing is still quite affordable (though avg. annual household income is about 60-70k and avg house is 380k).
Lets face it. CMHC is a major "spinner" of the media. The media follows CMHC like the bible of realestate. When CREB in Calgary released a forecast correcting CMHC, saying housing in Calgary would only go up 7% this year. Where'd the other 30% go?!
Anyhow, I know this is an edmonton blog, but just wanted to comment on the CMHC.
As for Edmonton, I know how you guys feel. I moved out of Edmonton just 8 months ago to go to Calgary. Don't believe the hype. 33+% of SFH for sale in Calgary are VACANT, and 40% of condos for sale are VACANT. What does that mean? It means the hype of "people are moving here and there's no where to live" is fake. There are about 3000 homeless people in Calgary, but a hella more vacant living spaces. Prices are driven up by speculators and investment "groups" (some groups owning up to an average of 3-4 homes EACH!).
Have fun in Edmonton. The bubble in Calgary seems to be nearing its inevitable destiny. I've driven by 3 houses in my neighborhood for the past 4 month's that have been for sale. Price as dropped, but no takers. They unlist, and relist (thus reducing the DOM) sitting vacant....
Just remember....he CMHC and CREB needed to release "forecasts" saying prices will rise again, they make money off of it and are smart for helping the run continue.
I never said CMHC could be trusted, but I think when it comes to data regarding the housing market, there seems to be MUCH more available by those who see benefit than those with unbiased views (look at all the data from banks, RE companies)
It's tough to find data that isn't skewed. Hopefully this blog will better interpret what is out there.
Former edmontonian said...
"Uh huh, CMHC can be trusted? Lets see here, they said just 2 weeks ago Calgary prices would go up 37%, with no real explanation as to why."
I recall the article, and I believe CMHC was refering to NEW homes for sale. This I believe as new homes *should* be 20-25% more expensive than a similiar lived-in home (land identical).
If they are predicting a Calgary increase of 5-15% in used homes, why wouldn't we expect new homes to be 37%?
I know in Edmonton new home prices have finally caught up to used homes. For the last 6-8 months new homes were actually lower priced than a similiar used home. Unfortunately no land was available.
glasshalffull,
I believe both sources are referring to sales of houses on the market (i.e. new+used). A sale is record when a property title has changed owner.
There isn't a need to justify the discrepancy here. Since they two different sources, no matter how much they share in common, they can have different forecasts.
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