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Thu January 11, 2007 www.edmontonsun.com- C3 W. N) {, E/ s3 o
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Thu, January 11, 2007
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Price is still rightEdmonton Real Estate Board president expects a 15% climb in 20078 ]& S" c. ]) N3 \! Y0 n5 Q
By NEIL WAUGH, EDMONTON SUN
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9 [5 Q( `4 D7 _. c: VThey'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. & a9 N, l' r7 C" W5 W; t$ E! C
# m' u3 V3 Q; y1 K7 {But first, the EREB president's bold predictions and fearless forecasts.
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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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"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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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. " J3 n3 y4 K1 ]+ F! V$ E
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"There just won't be enough houses to sell," she sighed.
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0 [, _$ O' m! ]( m8 d" D% NCanada 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."
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2 z& V/ j, H3 o6 cStill, 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. 5 E7 d" S) L8 ~& E, C8 E
; W" Z4 z* c: ]1 N" I( X"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. % J# ]' E0 w, n
' i0 {- d2 o9 j$ t7 H' ~0 W"But it's still going to be very, very strong," he quickly added, with the average new-home selling price ramping up by 20%. ; k4 b9 N5 N& l# j; t, h
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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.
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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.
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"Our growing presence in the marketplace is having a strong impact on the competition," Holowach winked.
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! t% [+ D3 b! u: kSo strong that the Alberta Real Estate Association launched a complaint with Alberta Government Services claiming ComFree was bending the truth about its market share. - J2 y. r; `( J2 [: n; L2 b2 j/ ~" G( T
* [) n+ A0 E2 v n' o# n+ s# PYesterday ComFree was still claiming 30% share of the residential market. And "commissions saved" of $82 million from his sell-it-yourself operation. Which, of course, is what the battle is really all about. ) M6 ^0 ~6 W* l( Z' S
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"We do 95% of the sales in the real estate market," Pratt countered.
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! H: d2 O" x5 L! bLet the good times roll.
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9 U# Q6 w. H+ h8 B4 N. V' t% V# }. uPrevious story: Bottom Line: h$ m- `, c$ t! i' [
Next story: Building permits hit record8 V2 u1 b3 M5 J* a$ g! v
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