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) ^7 U1 W$ B% g1 y7 ^( J; RPrice is still rightEdmonton Real Estate Board president expects a 15% climb in 2007
) P4 z6 R+ k' V* \/ e9 yBy NEIL WAUGH, EDMONTON SUN
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" h6 }1 K$ R9 V1 ]. Y2 D$ MThey're changing the guard down at the Edmonton real estate palace.
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2 o9 K( |3 g* G4 t% a& U% IMadeline 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. 5 Z3 M8 c2 s$ c* n
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But first, the EREB president's bold predictions and fearless forecasts. . v( R: a( m! d/ h1 N5 T. T s
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Don'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%.
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+ q" j0 h+ B2 y"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." & e" L& y* S' C1 w! X1 ^+ w* d
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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. ! I) W0 U) I1 u" P* {; [! B
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"There just won't be enough houses to sell," she sighed. & a1 m5 ?. S4 X* o% B8 z
[8 u2 F! W5 [+ H/ M9 {; XCanada Mortgage and Housing Corporation senior analyst Richard Goatcher was also talking a good-news-bad-news scenario at the board meeting. - E o/ @7 B/ o* F; ^8 {& R
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"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." 3 P6 r4 P* k. J! Z0 }# v- h
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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. 7 V8 U% T+ h# G' c' G
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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. 4 Q! b7 j% ]0 h" h
9 V# r" N9 L+ \: @, M% k% L"There are too many shortages in the system," he shrugged.
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! ]; D9 |& H: M$ L! M"But it's still going to be very, very strong," he quickly added, with the average new-home selling price ramping up by 20%. ) B% b- o$ t) h2 T6 B4 c
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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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Over 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. " n2 i" v0 a2 @
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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. & C! s8 k/ p5 j8 o( l4 v
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"Our growing presence in the marketplace is having a strong impact on the competition," Holowach winked.
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! `# C) L; h$ |! ASo strong that the Alberta Real Estate Association launched a complaint with Alberta Government Services claiming ComFree was bending the truth about its market share. 0 [3 J, m" n8 P! K
5 U% v& \! X& w$ kYesterday 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. " X1 y6 A0 o& P/ l7 l" y* V0 z
, S+ a s% s5 m# W5 W2 m"We do 95% of the sales in the real estate market," Pratt countered.
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Let the good times roll.
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' @/ b9 }: r0 b6 G- ]- G! h: f4 ^Previous story: Bottom Line
' L5 x: M% F0 [3 ~' R0 Q! DNext story: Building permits hit record9 ~# i* m% _' k0 t/ v
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