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1 z" e2 a3 D2 j. z% vThu, January 11, 2007
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4 F( d4 \$ @& \% uPrice is still rightEdmonton Real Estate Board president expects a 15% climb in 2007
, A% R( |% ?8 }. x% ] DBy NEIL WAUGH, EDMONTON SUN
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+ g4 V( z& ] N( `3 B* q4 DThey're changing the guard down at the Edmonton real estate palace. $ l$ ^* D; o" e2 ^1 e
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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. # ?( w2 w5 S6 |
1 N8 Y. D4 P0 g2 d$ E0 |But first, the EREB president's bold predictions and fearless forecasts.
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+ K% ^3 S; s9 h1 SDon'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%. 7 n; U( _9 y& r2 E
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'CONTINUED DEMAND'
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! a, u o; }/ e) f+ H. g5 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."
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- p u+ A% D3 v! d7 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.
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% Y9 f3 b3 `7 @7 d( P4 i, q"There just won't be enough houses to sell," she sighed.
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/ e( K: P- [! ~) M( T# ACanada Mortgage and Housing Corporation senior analyst Richard Goatcher was also talking a good-news-bad-news scenario at the board meeting.
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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." / P& G4 L* w' M9 N& c" Q9 v W
4 |/ [. K1 W* ?2 qStill, 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. |+ t# A6 K) V; O% C* J' r
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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.
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"There are too many shortages in the system," he shrugged. $ n- G7 q& t7 e9 ^7 O+ |
1 w [- I( z* a3 ~$ U/ y7 `( F"But it's still going to be very, very strong," he quickly added, with the average new-home selling price ramping up by 20%. 6 h' g* G6 |, F
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NO PRICE BOOM REPEAT
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' o: b4 _% H- p4 cHe also doesn't see a repeat of the 2006 price boom in the resale market, which he described as "unsustainable." - q. G+ p2 k# H4 {
9 r+ l+ _, V- D/ }6 p+ W2 zExpect 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. ( `' f; S( E1 p7 }- B
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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. 9 V4 i2 u) W2 y- f7 a2 M; @4 D4 Z
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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. 7 P( G1 T2 ~+ F
; t: h" s" o0 M"Our growing presence in the marketplace is having a strong impact on the competition," Holowach winked.
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7 F: E0 t. k3 bSo strong that the Alberta Real Estate Association launched a complaint with Alberta Government Services claiming ComFree was bending the truth about its market share. - r2 A8 _& a- s2 I* l1 g l
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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. 2 ?) \- u- R& i/ B+ |% Q
, `+ Z6 M' N6 j' DLet the good times roll. 4 y5 D; b9 }6 D r6 Q3 e6 e
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Previous story: Bottom Line
. A L9 l- p% a) s+ B0 }) c: ENext story: Building permits hit record
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