Oct

3

Calmer Housing Market Brings Opportunities for First-Time Buyers

Filed Under Buying, Canadian Economy, Home Prices | Leave a Comment

The numbers are in, and they bring good news for Canadian homebuyers. Price growth is beginning to ease up across the nation, according to Genworth Financial Canada’s Metropolitan Housing Outlook  report. For new and resale homes, price growth has quadrupled since 2001, but is expected to slow over the next five years, allowing potential homebuyers to feel a little breathing room.

If you are in the market for a new home you may want to check this out…

Calmer market ahead

In 2008, the rate of price growth should drop about 50% from last year for both new and resale homes across Canada. The return to historically normal levels will give consumer incomes a chance to catch up and buyers should feel less pressure and more opportunity to explore all the choices and financing options available to them.

“Now we’re seeing a calmer market,” said Peter Vukanovich, president of Genworth Financial Canada. “That translates into better opportunities for first-time homebuyers to make an informed decision.”

For homebuyers, this more stable growth is a welcome change from the increases in recent years. Both 2006 and 2007 saw an 8.7% increase in the price of new homes, and there has been a 10.2% average jump in the price of resale homes each year since 2002.

“Rapid price increases, which were virtually unsustainable in regions like Alberta, had begun to erode affordability and put a lot of pressure on first-time homebuyers in terms of their decision-making process,” said Vukanovich.

Housing market still strong

Overall, Canada’s housing market is expected to remain strong, supported by steady demand and modest price increases across the country. This year’s national average new home price is forecast at $397,789 (a 3.8% increase) with the 2008 average resale home price expected to reach $322,424 (a 5.1% increase). Regionally, the strongest housing demand can be found in B.C., Manitoba, Alberta, and Saskatchewan, as a result of the commodity-fuelled economic growth in the West.

National housing starts, however, are expected to ease to just below 215,000 units this year and 194,000 units in 2009. This represents a 15% drop, after eight years of steady increases. The drop in single-unit starts is expected to be greater than for multiples, reflecting the number of empty nesters looking to downsize and the affordability of these properties for first-time buyers.
Mortgage rates to drop

Mortgage rates will also see a drop this year as the lowered Bank of Canada interest rate flows through to the mortgage market. The average five-year conventional mortgage rate is expected to be 7.0% in 2008, dropping slightly to 6.7% in 2009.

For further report details, including regional numbers, download the full report.

More modest increases ahead

Canadians can look forward to more moderate price increases for new and existing homes across the country in the years ahead.

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Oct

1

Calgary Prices Past vs. Present

Filed Under Buying, Education, Home Prices, Real Estate General, Selling | Leave a Comment

We have had some incredible growth in our prices in Calgary, and Alberta in general.  At some points we were making money without even doing anything to our houses, and some months we were getting upwards of $5,000 per month “in our pocket equity”.  Times have changed… we are now seeing prices relax, and decline.  Now, don’t take me wrong, I’m not saying that the increase in Calgary and area is over, by no means, but the market is resting right now… Below is a great graph that puts it all into perspective of how well we have done with the prices in Calgary.

Would love to hear your feedback!

Sep

15

20% Further Price Reduction?

Filed Under Buying, Home Prices, Selling | Leave a Comment

In a recent Calgary Herald Article that was published this past weekend (Saturday September 13th) stated that a couple realtors in Calgary said that the home prices would be decreasing another 20% over the coming year.  One agent stated…

“Prices went up nearly 100 per cent in 2-1/2 years,” he says. “Let’s just say the ‘why’ for the decline can be found in the words, ‘Too far, too fast’.”

I do agree that there was a huge increase, but I do disagree that it was too far, too fast.  If we had increases like this over 5+ years, than yes, but in this case, the market is adjusting and finding it’s new bottom.  Every booming economy has it’s moments of breathing.  The market is alive and therefore needs to breathe.  As a seller in this market you really need to be on your game and know your ’stuff’.

Seller’s also really need to think like a buyer in this market.  By this I’m saying that you need to put your feet in the shoes of a buyer, and clearly understand what they think, so you are able to market to them properly.

The market is changing, and will do so for a while. Prices will most likely decline, to what extent and for how long?  Great question… don’t know…  When the market finds it’s new bottom, then we will be able to for sure say… “The Sellers Market is Back”.

On the flip side, it is truly a great time to purchase a home.  If you are planning on living in the home for 2+ years, there are some great deals out there.  If you are looking to do investments… again, great time!  If the investment will be a flip of a home, you might want to stear away from that right now, but for long term rentals… that’s the place to be!

Cheers!

Aug

14

The Sky Is (Always) Falling!

Filed Under Home Prices, Investing, Real Estate General | Leave a Comment

As you may have seen in papers or media… they are saying that the Canadian housing market is falling.  First off, if you are basing your idea of real estate purchasing or investing on the country wide stats, you are most likely not going to do well…  Every province, city and town is different, and needs to be studied on its own.

I really want to urge you to take a long term approach to what is happening.  The Alberta, and more specifically the Calgary and area market is taking a breath.  If the market continued to climb with 30%-40% increases year over year, I would be very nervous.  But with the market taking a breath, finding a new bottom, this says to me that there will be some continued growth in the future (there are many other reasons for this as well).  Personally, I am OK with the market the way it is.  The media and paper articles talk about how the market is not doing good and Alberta “in general” is having much greater decreases in year over year prices than the rest of the country.

All in all, if you are investing in real estate, or looking to buy a home, now is a great time to find some great deals out there for purchase.  There are motivated vendors (sellers), and some great cash flowing property.  Don’t get caught up in the media hype, and get overwhelmed… STAY FOCUSED!

Jul

17

Calgary Home Prices Drop, but Market Still Strong

Filed Under Calgary News Articles, Home Prices | 2 Comments

A survey by a national real estate firm shows average house prices in Calgary in the second quarter of this year declined in three categories - detached bungalow, standard two-storey and standard condominium - compared with a year ago, while national averages all increased.

According to the House Price Survey and Market Survey Forecast report released today by Royal LePage Real Estate Services, the average price drops in the Calgary market were 4.7 per cent for a detached bungalow (to $438,122), 6.0 per cent for a standard two-storey home (to $437,744) and 5.0 per cent for a standard condominium (to $285,033).

The Edmonton market saw bigger price plunges by 14.5 per cent for a detached bungalow ($320,000), 12.4 per cent for a standard two-storey home ($348,571) and 14.2 per cent for a standard Condominium ($226,000).

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