Calgary a ‘buyer’s market’ as 5-7% growth forecast: report

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By MARIO TONEGUZZI, Calgary Herald May 21, 2010

Calgary resale homes are expected to experience five to seven per cent year-over-year price growth in the short term, says a report released today by the Conference Board of Canada.

The Metro Resale Index classified Calgary as being in a “buyer’s” market.

The average MLS residential sale price in April in Calgary was $392,646, down from $399,104 in March but up from $368,025 in April 2009.

The conference board said Victoria, Vancouver, the Fraser Valley, Halifax and Newfoundland are also expected to see five to seven per cent year-over-year price growth in the short term.

Leading the country with expected price growth of more than seven per cent in the short term will be Edmonton, Saskatoon, Gatineau, Montreal, Quebec City, Sherbrooke, Trois Rivieres and Saguenay.


© Copyright (c) The Calgary Herald

Alberta only province to see improved housing affordability in begining of 2010

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By Mario Toneguzzi, Calgary Herald May 25, 2010

CALGARY – Alberta was the only province to experience an improvement in housing affordability in the first quarter of 2010, according to the latest housing report released today by RBC Economics Research.

The RBC Housing Affordability measures for Alberta eased between 0.1 and 0.6 of a percentage point, further extending the significant drop in the measures since the end of 2007, a trend that was only briefly halted last summer — a drop in the measure means homes are more affordable, said the report.

“In contrast to most other provinces, house prices remained relatively tame in Alberta during the past year or so and this has kept the cost of home ownership in check,” said Robert Hogue, senior economist, RBC. “In the first quarter, all RBC measures were at or below their long-term average, suggesting that affordability remains at favourable levels.”

The RBC Housing Affordability measures for Alberta, which capture the province’s proportion of pre-tax household income needed to service the costs of owning a home, declined across all housing types in the first quarter of the year.

The measure for the benchmark detached bungalow moved down to 33.0 per cent (a drop of 0.4 of a percentage point over the previous quarter), the standard townhouse to 25.4 per cent (down 0.1 of a percentage point), the standard condominium to 21.9 per cent (down 0.4 of a percentage point) and the standard two-storey home to 36.9 per cent (down 0.6 of a percentage point).

But the report found that home prices in Calgary have maintained an upward trend, although the overall pace has fallen short of the national average. In the first quarter, the increase in the costs of home ownership in Calgary was roughly equal to or slightly smaller than household income growth, leaving the RBC affordability measures hovering around the zero mark. Two-storey homes were down 0.5 percentage points, while a standard townhouse was up 0.2 percentage points.

“The housing market rebound turned out to be much more restrained in Calgary, compared to most of the other major markets in Canada,” said Hogue. “After posting strong gains in the early stages of the rebound, resale activity has slowed considerably since the fall, which likely reflects challenges in the city’s job market.”

RBC’s Housing Affordability measure for a detached bungalow in Canada’s largest cities is as follows: Vancouver 73.4 per cent (up 4.8 percentage points over the last quarter), Toronto 49.1 per cent (up 0.4 of a percentage point), Ottawa 40.3 per cent (up 0.3 of a percentage point), Montreal 39.7 per cent (up 0.9 of a percentage point), Calgary 36.5 per cent (down 0.3 of a percentage point) and Edmonton 32.0 (down 0.5 of a percentage point).

The RBC Housing Affordability measure has been compiled since 1985. The higher the reading, the more costly it is to afford a home. For example, an affordability reading of 50 per cent means that home ownership costs, including mortgage payments, utilities and property taxes, take up 50 per cent of a typical household’s monthly pre-tax income.

Large One Bedroom in Darlington Arms – SOLD!!

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1 Bedroom, 1 Bath
672 sq ft
MLS # C3446204
#301 317 14th Avenue SW

Freshly painted and upgraded large 672 square foot 1 bedroom condo in the Darlington Arms. Gleaming hardwood floors throughout this well laid out condo. Huge amount of storage with large bedroom closet, walk-in laundry room with additional storage, plus a large additional titled storage locker in the basement. Protect your vehicle in the secured, remote controlled, gated parking stall. This is one of the best run buildings in the city with myself and other Realtors owning and living in the building as well as actively making up the condo board. Two new boilers installed in 2003, as well as new hot water tanks in 2002 & 2004. Large lobby with 2 bike rooms and coin laundry. You couldn’t ask for a better location; 4 block walk into Gulf Canada Square and into the Downtown +15 system. Two blocks away from the nightlife, shopping, and restaurants of 17th Ave and the 4th st Mission lifestyle. Adjacent to the newly renovated Haultain Park with tennis courts & playground, plus Memorial Park which just finished $11 million in renos and upgrades. Checkout condo docs & more at building’s own website, You must check this one out!!

Call ERIK ROSS at 403-808-9996 to have a look at this condo or any other condo on the market!


2 Bedroom Renovated Condo Across from Foothills Hospital – SOLD!

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2 Bedroom, 1 Bath
958 sq ft
MLS# C3427903

Enjoy the convenience of being across the street from Foothills Hospital and steps away from the University of Calgary.  Perfect for investors, those working in the medical field, or the student who doesn’t want to rent.  This condo has recently been fully renovated with a modern kitchen including new cabinets and stainless steel appliances. Plenty of storage inside this condo, as well as an additional large storage locker. In-suite laundry. Gleaming laminate flooring throughout, even extending into the two large bedrooms. Huge sunny, west facing deck, perfect for entertaining. Great location in complex allowing lots of light into this condo. Parking is a covered stall just outside your door as well as extra visitor parking available. This is a well maintained condo complex with new roof on building. Easy access to shopping, restaurants, and C-train.


Call Erik Ross at 403-808-9996 to have a look at this condo or any other condo on the market.

40% of Calgary buyers see condos as investment: TD poll

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By MARIO TONEGUZZI, Calgary Herald May 5, 2010

CALGARY – The 4th TD Canada Trust Condo Poll released today says 40 per cent of condo buyers in Calgary are purchasing their real estate as an investment property — among the most likely in Canada to do that.

And of those, 41 per cent who bought or would consider buying a condo see a condo as a long-term source of rental income, compared to 35 per cent nationally.

The poll also said that while 26 per cent of Canadians plan on eventually moving into their rental condo unit, only 16 per cent of Calgarians plan to do so.

“Calgarians continue to see the value in purchasing a condo as an investment strategy,” says Chris Wisniewski, Associate Vice President, Real Estate and Secured Lending, TD Canada Trust. “Affordability and stable monthly expenses can make condos very attractive for both first-time buyers and investors.”

Calgarians are most likely in the country to think that market conditions have improved for buying a condo as an investment, however the number who feel this way has dropped from 52 per cent in 2009 to 38 per cent in 2010.

The TD Canada Trust Condo Poll revealed that lower maintenance needs of condos versus homes is the biggest motivation for Calgarians (42 per cent). Affordability is the second most popular reason for condo purchases (18 per cent).

For the fourth year in a row, the majority of Calgarians (82 per cent) say they would spend less than $400,000 for a two-bedroom condo.

The 2010 TD Canada Trust Condo Poll was conducted through interviews with adult Canadians who would consider purchasing a condo as a primary residence. The survey was conducted by Angus Reid Public Opinion, a division of Vision Critical, on April 14 — 20. The sample size of 1,012 men and women includes 208 in Calgary.

Appreciate your house, but don’t expect it to appreciate a lot

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Dan Richards – Globe Investor – Globe and Mail – April 26, 2010

Recently, the real estate industry has dominated the headlines. Mark Carney, Governor of the Bank of Canada, raised warning flags about the impact of higher interest rates on those Canadians who are already stretching to carry their mortgages. There’s been coverage of the dispute between the Competition Bureau and the real estate industry over proposals that would allow greater price competition among real estate agents. And there have been suggestions from within the industry that there needs to be increased professionalism among real estate agents. For many Canadians, none of these is the central issue when it comes to real estate. Rather, the key question comes down to the appreciation they can expect on the investment in their home. After all, the past decade has been a great period for homeowners. Expecting this to continue, some Canadians have stretched to buy larger houses now, before prices get away from them. Research firm Investor Economics points out that residential mortgages are at a record level, approaching $1-trillion.

The lessons of history

I had a conversation with Royal LePage president Phil Soper about the kinds of returns Canadians can expect on their houses. His central point is that, over the long term, house prices appreciate with incomes; since the early 1960s, his data show that house prices have grown by 2.4 per cent a year after inflation – what economists call the real return. Along the way, though, there have been lots of periods of dramatic fluctuation in house prices and many instances where individual cities experienced movements up and down that were very different from the national average.

The 1980s saw a big runup in housing prices, as demand grew from baby boomers establishing families and interest rates declined from their peaks in the early part of that decade. As house prices rose, affordability went down – by 1989, Canadians were devoting an all-time record proportion of their incomes to carry their houses. This led to a substantial correction in housing prices and to a lost decade for house prices in the 1990s. In fact, Mr. Soper pointed out that house prices went down in the 1990s after inflation was taken into account, the only decade on record where this happened.

The past 10 years

By 2000, incomes had moved ahead of house prices, laying the ground for substantial appreciation over the past 10 years. A recent report by TD Economics pointed to annual increases in house prices over the past decade of 8 per cent, among the highest in memory. As a result, the percentage of Canadians’ incomes devoted to carrying their houses has risen sharply to what Mr. Soper called the “affordable/expensive” level. The proportion of income dedicated to housing is not at the record levels of 1989 – but when mortgage rates rise, there is no question that some Canadians will be hard-pressed to carry their houses.

An academic’s perspective

Another point of view comes from Cynthia Holmes, professor of real estate at the Schulich School of Business at York University. Her research shows that over the very long term, average house prices go up with inflation – but typically don’t provide much in the way of a real return at all. She points to exceptions – for example, areas going through a transition in housing quality can experience she calls “windfall gains.” She identifies substantial benefits to owning a house – it creates forced savings and can lead to psychological satisfaction from the pride of owning versus renting, but as a whole, houses have not been particularly good investments over the long term. As evidence, she pointed to research tracking house prices in a central area of Amsterdam over 347 years, from 1628 to 1974. Price appreciation in real terms was very close to zero and nearly all of the growth in real value that did occur happened in two exceptional periods.

Price outlook

Psychologists point to a phenomenon called the recency effect – where recent events shape our expectations. As a result, some Canadians are expecting the kinds of appreciation on their houses they saw in the past 10 years – and are almost certain to be disappointed.

In a recent conversation with a group of retirees, a number talked about the “old days” of the fifties and sixties, when people thought about trading up in houses over time, without being concerned that prices would get away from them. One talked about considering the purchase of a more expensive house and deciding to wait – and five years later buying that same house at almost the identical price it would have sold for originally.

For the next while at least, people would be well advised to go back to the traditional reasons for owning a house, which is living in an environment they enjoy – and tempering hopes that their house will be a great investment.

Iphone Apps to Help with Your Move

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I recently came across a couple of great iphone apps to help with your move into your new home.

First is MovingChkList; this application provides you a complete list everything you will need to prepare for your upcoming change of residence. The list is broken down by categories to make it easy for you to navigate through the application. You can create multiple lists with different names for different moves and store comments for each with important information. Check off each item when it is complete or mark it as N/A. After completing a checklist, you can delete it or save it for your records.

Moving Van allows you to easily identify the contents of every box you pack when moving house, relocating or putting items into storage. Organize into Rooms for easy unpacking, identify which box has which item with full search features to find certain items. Photograph all items and upload

Calgary Housing Market to Simmer, not Sizzle

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Calgary, May 3, 2010 – Calgary’s housing market continues at a healthy and balanced pace, according to figures released today by the Calgary Real Estate Board (CREB®).

The number of single family homes sold in April 2010 in the city of Calgary was up 5 per cent from the same time a year ago, while condominium sales saw an increase of 10 per cent from the same time a year ago.

April 2010 saw 1,352 single family homes sold in the city of Calgary. This is a decrease of 3 per cent from 1,396 sales in March 2010. In April 2009, single family home sales totaled 1,290. The number of condominium sales for the month of April 2010 was 639. This was an increase of 5 per cent from the 609 condominium transactions recorded in March 2010. In April 2009, condominium sales were 579.

“Continued economic optimism, improved choice and price stability are all contributing to a healthy and balanced housing market in Calgary,” says Diane Scott, president of CREB®. “Calgary’s housing market is set to simmer, not sizzle in 2010. We can be grateful that we are not facing any real danger of a housing bubble here in our market.”

“There has been some talk about a bubble in some parts of Canada but the rapid price increases seen in Vancouver, Victoria and southern Ontario have not been seen in Calgary,” Scott acknowledges. “Single family house prices are coming back nicely compared to 2009,” says Scott.

The average price of a single family home in the city of Calgary in April 2010 was $460,378, showing an decrease of 2 per cent from March 2010, when the average price was $471,269, and showing an increase of 8 per cent from April 2009, when the average price was $426,311. The average price of a condominium in the city of Calgary was $289,588, showing a 2 per cent decrease from March 2010, when the average price was $296,660 and a 4 per cent increase over last year, when the average price was $277,953. Average price information can be useful in establishing trends over time, but does not indicate actual prices in centres comprised of widely divergent neighbourhoods, or account for price differentials between geographical areas.

The median price of a single family home in the city of Calgary for April 2010 was $417,000, showing a 1 per cent decrease from March 2010, when the median price was $423,000, and a 10 per cent increase from April 2009, when the median price was $380,000. The median price of a condominium in April 2010 was $267,500, showing a 3 per cent decrease from March 2010, when the median was $275,000. That’s up 7 per cent from April 2009, when the median price was $251,000.

All city of Calgary MLS® statistics include properties listed and sold only within Calgary’s city limits. The median price is the price that is midway between the least expensive and most expensive home sold in an area during a given period of time. During that time, half the buyers bought homes that cost more than the median price and half bought homes for less than the median price.

“Our average price is holding relatively steady,” says Scott. “The pace of price increase has been tempered by the rate of new listings that has been growing faster than sales. Sales levels are still well below the high demand from 2004-2008, mainly because we are still not seeing high job growth and unemployment has remained high.”

Single family listings in the city of Calgary added for the month of April totaled 3,082, an increase of 3 per cent from March 2010 when 2,988 new listings were added, and showing an increase of 53 per cent from April 2009, when 2,010 new listings came to the market. Condominium new listings in the city of Calgary added for April 2010 were 1,335, down 3 per cent from March 2010, when the MLS® saw 1,376 condo listings coming to the market. This is an increase of 38 per cent from April 2009, when new condominium listings added were 967.

“Calgary didn’t see the impacts of the very low interest rates the way other areas of Canada did,” says Scott. “Calgarians are also not rushing out to beat the rate increases as they are seeing less risk of rising prices squeezing them out of the market.”

“In fact financially, Calgarians are in a very healthy position. Just over 37 per cent of our median pre-tax household income was needed to service the mortgage on a typical detached bungalow in Calgary—that’s below the national average,” says Scott.