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Thu January 11, 2007 www.edmontonsun.com
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! @$ S; P% m; z# c! ^1 n$ OThu, January 11, 20071 h4 u; \. S; E4 F
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Price is still rightEdmonton Real Estate Board president expects a 15% climb in 2007) x9 ]! x$ l$ Z+ @$ F z/ _
By NEIL WAUGH, EDMONTON SUN/ s/ G9 ]2 W6 |6 Q" J% \1 K) ?+ f
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3 e: ~2 R; @) G2 }" ?/ fThey're changing the guard down at the Edmonton real estate palace.
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Madeline 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. " ?7 x3 {- z1 m x' i5 ]
7 J$ t! a$ U" s, p! XBut first, the EREB president's bold predictions and fearless forecasts. 6 b+ e* V, f2 E8 y
. q, O1 b9 T% g2 S4 wDon'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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7 {: K( h; A* Z# D' ~5 _3 O- B"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."
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- @3 n# _, i$ b5 U+ o5 f8 q4 n& t4 bShe 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. 0 E- D D, @/ ?
& s4 [3 }# ~, I4 G3 E"There just won't be enough houses to sell," she sighed. / z# W' |4 j1 d) [+ q2 D5 c
- l* w# O- \) aCanada Mortgage and Housing Corporation senior analyst Richard Goatcher was also talking a good-news-bad-news scenario at the board meeting. ; u; O1 C+ Y7 Y) y0 r6 U* S# r$ U
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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 ~: H$ `$ q- J F
8 \# e& X) F$ {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. ! B: \) w9 }, w. L% R& z, D
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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. 2 c( i, ~) R% a+ L _
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"There are too many shortages in the system," he shrugged.
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/ A! A' Z3 X9 w/ n n) L7 S; O* q"But it's still going to be very, very strong," he quickly added, with the average new-home selling price ramping up by 20%.
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' q t: ]' h& j6 t3 Y& l. HNO 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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: Z j- `2 l7 R3 E0 a2 j+ R9 j3 oExpect 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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. @; i- y2 ?0 }) @- U9 _/ DOver 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.
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0 R9 s" v, Q, B4 mHis 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.
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+ J1 i) V% v$ _! ]4 k1 T"Our growing presence in the marketplace is having a strong impact on the competition," Holowach winked.
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So strong that the Alberta Real Estate Association launched a complaint with Alberta Government Services claiming ComFree was bending the truth about its market share.
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Yesterday ComFree was still claiming 30% share of the residential market. And "commissions saved" of $82 million from his sell-it-yourself operation. Which, of course, is what the battle is really all about.
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"We do 95% of the sales in the real estate market," Pratt countered. / P: z q6 [' s9 ~+ }
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Let the good times roll.
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4 \ V$ w* q8 |3 `- I# BPrevious story: Bottom Line0 J4 U" m9 M5 X5 A* W0 [
Next story: Building permits hit record
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/ ^& Y. N1 [+ E1 ~, K% N" P This site is updated by 4:00 a.m. MST each day and includes stories and columns from the day's print edition of The Edmonton Sun.
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