RECA Launches Updated Website

The Real Estate Council of Alberta (RECA) is pleased to announce the launch of its updated website at www.reca.ca. The new website is a culmination of more than six-months of extensive work within the communications department, RECA’s management team, and external technical advisers.

The main goals of the restructuring and redesign of the RECA website were: to make it easier to navigate, more user-friendly, to update existing information; and make the site more visually appealing. RECA has also increased the amount of information available through the site and will, in the coming weeks, continue to add information, especially in the areas of consumer information, mortgage brokerage, and real estate appraisal services.

Click here for a post I wrote about RECA that details who they are and their role in the real estate industry in Alberta.

///…CP

National Housing Figures Confuse Consumers

The following information has been adapted from the REALTORS® Association of Edmonton.
____________________________________________________________________________________ 

Consumers continue to be confused by housing figures originating from American or Canadian sources that do not reflect the condition in local markets.

“I urge people to consider national trend figures carefully” said REALTORS® Association President Charlie Ponde. “Sales and listing figures produced by the REALTORS® Association track local sales that may not be included in so-called national housing indexes such as the National Bank/ Teranet House Price Index.” Teranet only includes figures from six Canadian cities (not including Edmonton) and Toronto figures carry a weight of 42% according to their web site.

Ponde explained that Association numbers are calculated by summing all residential sales in the greater Edmonton area that were made through the MLS®. The total value of all sales is divided by the number of transactions to determine the average residential price. Other averages are calculated by housing type or by geographical criteria to provide more refined analysis of the local market. REALTOR® Association of Edmonton figures do not include new home or private sales.

Sales figures are double-checked by brokers and cooperating REALTORS® and are also subject to review by the REALTORS® Association. Local statistics are available to the public at www.ereb.com.

///…CP

An Urban Myth: Foreclosures Are Always A Bargain

The following has been reprinted with permission from the Alberta Real Estate Association (AREA) and is copyright of AREA. AREA makes no guarantees as to the accuracy or completeness of this information.
____________________________________________________________________________________ 

 

For Canadians, it’s mind-boggling to hear about the prices foreclosures are going for in the United States. Fifty thousand dollars for a 5-bedroom, 3-bathroom, single-family, semi-detached home with enough closet space to hold fifty thousand pairs of shoes…Where do I sign?!

Typically, foreclosures aren’t as glorious in Canada as they are south of the border. Why? In Canada, there are two methods for lenders to recover mortgage debt:

• Judicial Sale – Lenders must receive the court’s permission before they can sell the property; and
• Power of Sale – Lenders can sell the property without the court’s involvement.

Judicial sale is the primary debt-recovery method used in Alberta

Two other important factors differentiate Canadian foreclosures from those in the United States. In Canada:

• Properties cannot be sold under market value; and
• Properties must be accompanied by an appraisal.

Aside from the likelihood that the foreclosure isn’t a great bargain, purchasers of foreclosure properties face several other risks. For example, banks have the ability to sell or dispose of property “as is”. This means that before putting a property on the market, banks don’t have to remediate or repair structural defects, environmental or health hazards, or homes that have been condemned.

Before packing their shoes or reaching for their wallets, buyers should be advised to seek professional assessments. It’s never wise to buy something sight unseen. And if profit is the motivation behind purchasing foreclosures, Canadian buyers may be disappointed.

 

///…CP

What Was Really Said: An Overview of the 2009 Housing Forecast

If you’re a regular visitor to my site then you already know I attended the 21st Annual REALTORS® Housing Forecast Seminar last Thursday. As promised in my post last week, the following is my summary of what was said and what the predictions were for the coming year.

All-in-all it was a great (sold out) event with over 800 people in attendance and some fantastic (and extremely knowledgeable) speakers. The following is a list of speakers at the event:

• Aroon Sequeira, Partner & Senior Vice President, Ernst and Young;
• Ron Gilbertson, President and CEO, Edmonton Economic Development Corp.;
• Pat Adams, President, Canadian Home Builders Association – Edmonton Region;
• Ian Glassford, CFO, Servus Credit Union;
• Richard Goatcher, Senior Market Analyst, Canada Mortgage and Housing Corporation; and
• Charlie Ponde, President, REALTORS® Association of Edmonton.

As you can see by the list, insight at the event was provided by some pretty big brains with a lot more economics knowledge  and experience than most of us will ever begin to understand.

Rather than write a long-winded post, I have opted to provide a bullet-list summary of the main points offered by the speakers:

• even the large companies expect their revenue growth to slow but are still positive on Edmonton;
• any major company or firm should be in Edmonton, despite economic concerns;
• Edmonton is a world-class city with many strengths that will help us through these uncertain times;
• Edmonton’s economic diversity (i.e. not just oil and gas) will help to insulate us from the ups and downs;
• we have survived previous ups and downs and our highs and lows won’t be as high and as low as they were then (e.g. recessions of the 1980s and 1990s);
• there are always opportunities, even in times of turmoil;
• globally there is a shift to return OF principal rather than return ON principal;
• deflation and deferred consumption is a negative self-fulfilling cycle;
• in Canada and Alberta, we are in much better shape than most other economies;
• recessions happen, BUT so do recoveries and this cycle is not new (we just haven’t seen it for awhile);
• at the moment, interest rates are coming down while incomes are still rising;
• Edmonton home prices may experience minor gains and minor losses throughout the year; and
• it is expected the overall prices in Edmonton at the end of 2009 will finish where they are today.

The following story provides a great summary of part of the overall message attendees were to take away from the event. It is a PDF version of the story The Hot Dog Vendor provided at the event by the REALTORS® Association of Edmonton.

Feel free to contact me if you’d like some more information on what was really said at the 2009 Housing Forecast Seminar.

///…CP

Renovations at REALTOR.ca

By now everybody knows the old MLS.ca became REALTOR.ca back in July 2008 and in the roughly six months since the change, I have received a number ‘complaints’ and comments from people unhappy with the new and improved site. Many of the unsatisfied users indicated they did not like the new navigation and missed some of the navigation features of the old system.

Clearly The Canadian Real Estate Association (which operates and maintains the site on behalf of REALTORS® across Canada) got the message from consumers as well. Presumably in an effort to address some of the ‘issues’, the folks at CREA implemented a number of enhancements to REALTOR.ca recently:

• Introduction of Gallery View display This allows users to view up to 12 property photos at a time, covering up the interactive map. The button to use this option appears at the upper right of the map page, above the existing column showing thumbnail information.
• Introduction of Thumbnail View display This view provides 12 property photos at a time with property description and links to other features such as multimedia. It is accessed by a button at the upper right of the map page.
• Enhanced positioning for ‘Save Search’  The ‘Save Search’ was moved to the upper left, above the ‘Refine’ column on the map page. This makes it more evident consumers can save their search criteria, making it easier for returning visitors to search based on their initial criteria.
• Technical and Browser issues Issues where some MLS® number searches would not execute have been fixed. Also, the site is now more compatible for users of Firefox Version 3.

Feel free to let me know what you think or better yet, email CREA. Happy home surfing!

///…CP

Was I Right? (A Review of 2008)

At more or less this time last year I completed a review of Edmonton’s real estate market for 2007 and offered my humble opinion on what I thought 2008 would have in store for the market. The following post is a review of the market for 2008, a look at how close my predictions for the year were, and what I believe is in store for 2009.

You can find last year’s review here; including what I thought should happen, may happen, and was likely to happen. In brief, I felt the market should begin to pick up in 2008, cautioned it may remain flat, but overall felt it was likely to make modest gains by the end of the year.

Before dissection begins (just like last year’s review) let’s start by looking at snippets from the REALTORS® Association of Edmonton Monthly MLS® Reports; specifically the average single family dwelling price and corresponding press release headline:

• January |$379,567|
• February |$381,965| Resale Housing Sales Strong in January
• March |$387,632| Housing Prices Unwavering So Far This Year
• April |$386,033| First Quarter Results Show Housing Prices Are Stable
• May |$383,167| MLS® Housing Sales and Prices Remain Stable in April
• June |$381,384| Never Been a Better Time To Buy a Home, Says REALTORS® Association
• July |$379,224| Dynamic Tension Between Buyers and Sellers In Edmonton Market
• August |$369,190| MLS® Sales In July Up 14% Compared To Last Year
• September |$362,097| August Residential Sales Up 18.6% Over Last Year
• October |$363,274| Edmonton Resale Housing Market Sizzles In Third Quarter
• November |$362,757| Edmonton Resale Housing Market Maintains Stability In Uncertain World
• December |$351,870| Housing Buyers React Cautiously In Local Markets

Does all of the above look like gibberish to you? Click here to see what it all looked like graphically.

So what does it all mean? As far as my predictions go, I was about half right. Recall I stated what I thought should happen, may happen, and was likely to happen.

I correctly predicted that the market should begin to pick up in February/ March: “…with an increase in listings, sales, and (possibly) small gains in market value.” The average price for a single-family dwelling in 2008 actually peaked in March.

I also correctly predicted the market may stay flat: “…with an increase in listings, slower sales, longer days-on-market, and little or no increase in market values.” Inventory peaked at over 11,000 midway through the year, average days-on-market was up to 65 days by the end of the year, and the average price for a single-family dwelling was more-or-less the same in July as it was in January.

I missed the mark when I said I felt the market was likely to follow a ‘normal’ cycle with: “…a reasonable gain (3-5%) in market values with a reasonable exchange/ turnover between listings and sales.” In fact, from January 2008 to December 2008, the average price for a single-family dwelling dropped by almost 7.3%, and the total number of residential sales was down by 15.25% compared to 2007.

So what about 2009? I would expect a return to a more balanced and normal real estate cycle with the usual seasonal influences apparent. Inventory appears to have stabilized at somewhat normal levels and the prices seem to have landed at a point that encourages buyers and sellers to come together. Having said that, I must caution you again that anybody that tells you they know for certain what lies ahead for our market is either full of a prohibited pharmacological substance or full of…you get it.

I am attending the 2009 Housing Forecast Seminar on Thursday and will summarize their predictions in a new post later this week or early next week. Stay tuned…

///…CP

I Want to Buy…But I Need a Down Payment.

This post is the result of a meeting I had with some mortgage brokers from BMO last week…

Most of us have heard of and/ or are familiar with the Government of Canada’s Home Buyer’s Plan (HBP) that allows first-time home buyers to withdraw up to $20,000 from their RRSPs to buy or build a qualifying home for themselves or for a related person with a disability.

You can find out more here…

 

The purpose of this post is to let you know about a creative way that BMO has come up with to help you maximize your down payment in the shortest period of time…

Here’s how they suggest doing it:

• Borrow up to $20,000 from BMO to purchase an RRSP;
• At day 91, redeem the $20,000 RRSP under the Home Buyer’s Plan and pay off the BMO loan (estimated interest cost for loan is $300);
• If you are in a 35% tax bracket, the tax deduction you will receive for the $20,000 contribution will be approximately $7000.00;
• If you and your partner were both to do this, you would receive $14,000 in tax deductions (potential refund), that you could use as the down payment toward your home.

Obviously the above information is generic and is for illustrative purposes. Contact me directly and I will put you in touch with my BMO contacts so you can determine if this is an option for you…

///…CP 

You’re Listed — But Do You Really Want To Sell?

Hopefully this post doesn’t come across too rant-like, soap box-ish, or otherwise disjointed…but here goes.

So you want to, need to, have to, or have otherwise chosen to list your home for sale…

You’ve completed those little maintenance things that require attention.
You’ve cleaned/ de-cluttered your home so that it shows it’s best.
You’ve interviewed several REALTORS® to ensure you have the best person on the job.

…right?

Judging by my experience this past weekend, some consumers are still either: a) willing to accept poor service (despite having hired a professional); b) not doing their homework ahead of time (i.e. reading my blog posts); c) feel as though they don’t have a choice; or d) don’t really want to sell.

So what happened this weekend that brought me to write this particular post?

I have Clients looking for their next home. They are looking for a home that is less than ten years old, offers 1,400 to 1,800 square feet, and is priced between $350,000 and $450,000. After wading through the tons of homes that fit their criteria, I narrowed the list of contenders down to fifteen homes to show this weekend.

Here’s where my “fun” begins…

Throughout Friday afternoon and evening I spent time building a showing schedule for the coming weekend, which included contacting home sellers and REALTORS® to schedule my appointments – as per the showing instructions on each listing. [Did you catch that? Contacting the home seller(s) to schedule an appointment -- what the...?]  Of the fifteen homes I wanted to show to my Clients, there were three of them we never did get in to see because either the home seller or the REALTOR® failed to return my repeated calls/ paged requests to show.

[Here's the soap box-ish rant-like part...] Suffice to say I don’t understand this at all. Why on earth would you hire a REALTOR® to sell your home and then personally field the calls from other REALTORS® to show your home? I know under certain circumstances it may (initially) make sense to take the calls yourself (e.g. shift worker, home-based business operator) — but isn’t that why you hired a REALTOR®; instead of going For Sale By Owner? I can’t believe how many of my colleagues have home owner(s) taking phone calls at home, at work, and on their cell phones to schedule appointments to show their own home.

Shouldn’t that be part of the service your REALTOR® provides?

[Back to the purpose of this post...] If 20% of home owners and/ or REALTORS® don’t avail themselves for scheduling viewing appointments (as was the ratio for my Clients and I this weekend), do they really want to sell?

If you really do want to sell your home, don’t you think prospective buyers need to be able to get in and view your home?

///…CP

REALTORS® Community Foundation — I Care

The REALTORS® Community Foundation provides support to those in need in our city by working with charities involved in shelter, homelessness, hunger, crime prevention, and special projects.

In 2007 the REALTORS® Community Foundation granted over $244,000 to charities in and around Edmonton.  Since 1986 the REALTORS® Community Foundation has returned over $1.6 million dollars to the Greater Edmonton Community.

One of the funding streams upon which the REALTORS® Community Foundation relies is the ‘We Care’ program. The program provides an opportunity for REALTORS® within Edmonton and the Edmonton area to donate a portion of their commissions to the REALTORS® Community Foundation on a per transaction basis.

It is but one of the ways we as REALTORS® can give back to our communities and the money donated forms part of the Funding Allocation dollars given out each year by the REALTORS® Community Foundation.

So the next time you’re meeting with your REALTOR®, ask them if they care…

///…CP