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7 l) t4 W: Z) ^- w8 k* |3 i, ` Thu January 11, 2007 www.edmontonsun.com% v; h6 S4 i& h2 @$ t/ Y
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# d( f& Z6 U5 {+ yThu, January 11, 2007
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7 S0 g8 y8 ~9 nPrice is still rightEdmonton Real Estate Board president expects a 15% climb in 2007
& r8 m( ~6 r, {By NEIL WAUGH, EDMONTON SUN2 _& i1 p/ n2 s2 ^8 h- \
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$ d( U, T' w8 c0 V3 v8 \& M7 JThey're changing the guard down at the Edmonton real estate palace. % V7 I9 b6 ?: T2 X
. x9 g+ ]2 c! y* s `: |; VMadeline 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. 9 g7 k3 o- n5 j6 F
5 u+ m. w( ]1 g' p" v5 P; yBut first, the EREB president's bold predictions and fearless forecasts. ( C! `4 j, A' `/ \ X7 o4 p x! a
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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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'CONTINUED DEMAND' # Z4 o2 ]) N3 z3 g4 Y, n2 M6 E
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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." ( m+ f4 l& N0 c$ g8 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. 8 _1 t" I; p4 K m, m8 J
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"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.
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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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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. 6 I# U/ o. ]3 P0 c5 ^
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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. 2 `8 g' [& Y4 u/ p
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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%.
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NO PRICE BOOM REPEAT ' T% a u% ?* N z9 D0 O; T
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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." o4 D% W, c5 u1 _# n' X' Y
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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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& D# x3 q% e: nOver 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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; w: R: ^& N% THis 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. / ]+ A$ c8 Z* ]9 o
. D# U) u9 C6 M+ Z+ p"Our growing presence in the marketplace is having a strong impact on the competition," Holowach winked. * ] h* S. A0 K. e, _' n( c. _; Z
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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 $82 million from his sell-it-yourself operation. Which, of course, is what the battle is really all about.
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D" P9 w& w7 E3 p: M"We do 95% of the sales in the real estate market," Pratt countered. 6 i5 }! E* ^% r' z0 ^* o2 }0 V: `) B
6 @( Y/ ]* L. GLet the good times roll.
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Previous story: Bottom Line
, Z2 G- p2 K# P2 Z$ y- v% {Next story: Building permits hit record
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