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; x, s. u, M4 ~) P Thu January 11, 2007 www.edmontonsun.com
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Thu, January 11, 2007$ `5 J5 V5 F! [5 X% a
* ^& R/ z& l' o& X1 APrice is still rightEdmonton Real Estate Board president expects a 15% climb in 20077 a& W+ L% @0 y" j$ F2 A! L
By NEIL WAUGH, EDMONTON SUN( v# g( @7 G. P5 `
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They're changing the guard down at the Edmonton real estate palace.
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9 v$ |& V. I, g. y' RMadeline 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. ) R2 `! Q( y# F. u, x! }6 [
% K K/ u! y0 m! G, oBut first, the EREB president's bold predictions and fearless forecasts. 5 P4 S2 K! y. L; t
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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%. 3 `( Z' B8 j. i$ G
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'CONTINUED DEMAND'
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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. " t/ r. A- [7 x; _/ p3 m0 k
4 l0 X7 B3 F' H- H6 B"There just won't be enough houses to sell," she sighed.
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Canada Mortgage and Housing Corporation senior analyst Richard Goatcher was also talking a good-news-bad-news scenario at the board meeting. + i5 I7 O5 {2 u
) L- e/ I* j, M$ l8 \8 j"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." 5 W1 f3 j a! }9 A" ~( @
4 i; ~1 [" |. U7 g7 x+ WStill, 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.
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$ h* H, D7 R: o; v& A* x: q' g"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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& Z9 C0 \3 ^' K0 }. h+ f"There are too many shortages in the system," he shrugged. ! g# N7 q, l( Y1 X9 F8 m8 x( X
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"But it's still going to be very, very strong," he quickly added, with the average new-home selling price ramping up by 20%. 0 p- F0 ?8 t- l- I
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! L* l, J2 ]1 {6 _' [He also doesn't see a repeat of the 2006 price boom in the resale market, which he described as "unsustainable." 0 ]8 O$ h' }9 m
2 I e2 M. b% o) 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.
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" J$ x* X3 j& s, `! g! sOver 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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8 U( I/ T6 l/ O8 K" U( |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. . b7 n8 P h8 w7 |( s
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"Our growing presence in the marketplace is having a strong impact on the competition," Holowach winked. / r3 I, s0 {$ g1 L O7 k
. g+ D) ]1 [4 p* r* jSo strong that the Alberta Real Estate Association launched a complaint with Alberta Government Services claiming ComFree was bending the truth about its market share. 4 M' i9 I/ {$ C
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Yesterday ComFree was still claiming 30% share of the residential market. And "commissions saved" of $82 million from his sell-it-yourself operation. Which, of course, is what the battle is really all about.
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"We do 95% of the sales in the real estate market," Pratt countered. ( H/ l/ Z6 ^7 [+ c q0 Q" f3 P
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Let the good times roll.
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& _! G, c3 H5 }9 d# w( m' @6 cPrevious story: Bottom Line
9 m$ c q1 ^8 E3 L. s( }' eNext story: Building permits hit record3 ~. O5 `6 O( N# H9 z& t+ S
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