Calgary residential construction

[rotten42]

Trueman homes is still quite busy but they branched out into different kinds of housing that makes them busy. Multi-family units and in-fills. Those are still very strong segments.

[Addick]

Originally Posted by Ace

This is what is going to keep the prices high, so ultimately the consumer and Calgarians pay the price/enjoy the property value. When developers can go at whatever pace they want we get a flood of lot inventory and that keeps prices down.

When non-sequenced growth is allowed to take place there are also additional costs that are usually borne by the City (i.e. externalities). As sequenced growth internalizes these costs, are the increased prices simply the true cost of the developments and their housing stock?

If we are seeking more affordable housing, there are strategies that are more efficient and effective than non-sequenced growth.

[JD]

Why is it OPECs job to "play along" and sustain prices? They're just protecting their market. It's the U.S. that ramped their production creating the glut we see now. Although it's pretty simplistic to blame countries.

[SeeGeeWhy]

Originally Posted by bysutter

OPEC has been controlling the price of oil for some time, their refusal to continue play the game (for whatever reason) has us where we are right now. What we are seeing now is not a manipulated market but a free market that will be dictated by supply and demand. For most economies lower energy cost is a good thing, not so much for us feedstock selling hillbillies that have no economy other than oil and gas.

Spent well technology means that because of technology we are able to squeeze more out of what was considered to be a non-producing asset (spent). As this technology gets better ("found oil") chances are that we are looking at more supply than is needed, supply is greater than demand means lower prices.

Assuming that it was ever OPEC's job to maintain a certain global price for oil, what was that price?

Second, enhanced oil recovery (EOR) has been around for decades. Spent well technologies like waterflooding, CO2 flooding, wellbore cleanouts, stimulations, etc are nothing new. What is being adapted to unconventional plays at a larger scale is horizonal drilling combined with multi-stage facturing. The drilling is becoming more accurate and less expensive, this is what has touched off the production boom in the US. Currently there are no secondary recovery schemes for this type of production, just drilling more wells. The fracturing could be a lot better, so there is still some room for growth in this regard. That said, these reservoirs are closer to source rock than actual traps - once the initial flush production is collected, its a long tail of low rate production.

The next big frontiers will be unexplored areas in the arctic, harvesting gas hydrates, and hydrocarbon manufacturing.

Oil is a highly commoditized and globally traded product. Its price is very reliant on supply and demand. There are fewer and fewer markets where you get isolated pricing effects. Natural gas, is a far different story and as LNG infrastructure is invested in, this too will begin to change.

Needless to say, with the demand for hydrocarbon continuing to grow steadily on a global scale, there is a higher chance prices will recover to the levels required to produce the types of unconventional resources we are talking about. Saudi Arabia has a low cost base for it's production, but most of the other OPEC members do not. The pressures for increasing oil price are greater than decreasing oil price in the next 2 - 3 years. Natural gas is a different story in my mind. There is a LOT of natural gas around the world, and very slowly the markets with the highest demand are being connected to it. There will be a lot of very interesting changes both up and down in natural gas benchmarks in the coming decades. Oil, on the other hand will almost certainly continue to rise.

[polak]

I have a close friend who paints and he mostly works on big custom homes and he claims business is still good. Big custom homes like that take a long time for each trade to get through though so that might delay the effect of the slowdown.

Also very possible that the people who can afford custom homes simply don't care about speculating on personal Real Estate like we peasants do.

[bysutter]

Originally Posted by JD

Why is it OPECs job to "play along" and sustain prices? They're just protecting their market. It's the U.S. that ramped their production creating the glut we see now. Although it's pretty simplistic to blame countries.

Yes and no....OPEC (really the low production cost arab countries) have been assisting in price range fixing campaign for years and stopped doing so (reasons unknown, but they are probably pissed that the desperate Americans would actually have the balls to increase production without their approval). The Americans ramped up production creating a supply/demand inbalance and without the arab price range fixers playing along the price of oil fell back sharply cuz supply sharply exceeded demand.

This is just one of many problems tied up in the complex world and worldwide supply of oil.

Like I said....get used to $50 or less for a while.

[bysutter]

Originally Posted by polak

I have a close friend who paints and he mostly works on big custom homes and he claims business is still good. Big custom homes like that take a long time for each trade to get through though so that might delay the effect of the slowdown.

Also very possible that the people who can afford custom homes simply don't care about speculating on personal Real Estate like we peasants do.

Why would you speculate on real estate?

Do you not understand that is the root of the problem and all you are doing is falling into the trap the bankers, builders and realtors set for you?

[polak]

Originally Posted by bysutter

Why would you speculate on real estate?

Do you not understand that is the root of the problem and all you are doing is falling into the trap the bankers, builders and realtors set for you?

What? By speculating I meant someone like me takes into consideration the possibility that prices might drop within a year and will hold off from buying where as someone buying a 3 million dollar home might not care as much.