Calgary Real Estate predictions?

[chemgear]

Originally Posted by gottabekd

Cool, thanks for all the links about recent sale prices. Mike Fotiou's recent sales links (click on the date in the What Happened on: row) also show the listing, and original listing price. Really gives a good idea for how much of a discount of the listing price some places are going for.

Yeah, there is so much good info there (I know I'm starting to sound like a fanboy! )

Anyhow, the "Average SP/LP Ratio" has been pretty fixed at 96% for the last few months now. Though I assume that theoretical 4% price cut/drop is on just the most recent/current listing - probably doesn't go back to the original if the seller has relisted multiple times with varied pricing.

Now I realize that this is anecdotal, but I did notice a listing that I had been eyeing for quite a long time - it was priced way too high and never moved for months. It got pulled and relisted again - at a ~ 4% higher price. I wonder if the plan/hope is to entice somebody with a "price cut" but still get the original price. Not sure.

[chemgear]

Originally Posted by 1stLand

I think the story and ad is bogus.

You cannot find a single family detached home in Signal hill for $215k.

Yeah, you are probably right. Got some hand waving in the news though.

[chemgear]

I came across this report early in the year about housing:

http://www.scribd.com/doc/28454918/C...Housing-Bubble

Apparently the author made an update recently:

http://www.scribd.com/doc/36383418/T...le-Summer-2010


It's pretty number heavy, reading isn't overly light either. Very good information though - good reads.

[chemgear]

The end of the month is upon us (pay day!), I'll try to post August numbers once the data gets posted on those nice websites.

New report out today as well:

http://www.policyalternatives.ca/new...housing-bubble

SFH prices are down around 7-8% in the last 3 months. Inventory will still be kicking around 6 months. September 8 will be the next rate announcement - analysts are split whether a bump is coming or not.

[VladtheImpaler]

Just anecdotally, we popped into an open house in Woodbine on Sunday while out for a walk, and the realtor was literally begging us to make an offer for all intents and purposes. In effect saying "oh don't worry about the asking price - they'll take a lot less". Nothing is moving in our area...

[troutman]

August was our slowest month of the year. Hopefully things pick up in September with families back from vacations.

[Cowboy89]

Originally Posted by troutman

August was our slowest month of the year. Hopefully things pick up in September with families back from vacations.

Isn't August typically a busy real estate month as families like to have their kids settled in their new school come September?

Not sure but just asking for clarification.

[troutman]

Originally Posted by Cowboy89

Isn't August typically a busy real estate month as families like to have their kids settled in their new school come September?

Not sure but just asking for clarification.

Usually June and July are the busiest, and in an average year, August is good. I think September was better than August last year too.

[Clarkey]

Originally Posted by troutman

August was our slowest month of the year. Hopefully things pick up in September with families back from vacations.

Well I've done my part to get things moving again. Trout, you'll be getting my business, our possession is late September.

[chemgear]

Originally Posted by Clarkey

Well I've done my part to get things moving again. Trout, you'll be getting my business, our possession is late September.

Congratulations on the new place!

[chemgear]

Originally Posted by troutman

Usually June and July are the busiest, and in an average year, August is good. I think September was better than August last year too.

Pretty darn close (better memory than I have!)

SFH June/July/August/September/October

2010: 1061/915/860?
2009: 1837/1585/1277/1257/1285
2008: 1493/1313/1170/1152/820
2007: 1757/1495/1314/1064/1113

[Icon]

Man am I glad I sold my condo back in April instead of waiting until the fall / now... list prices in the area have dropped 10-15%.

[pepper24]

The report, Canada's Housing Bubble: An Accident Waiting to Happen, which looks at trends in house prices in Calgary, Toronto, Vancouver, Edmonton, Montreal and Ottawa, says that between 1980 and 2010 increases were "outside of a historic comfort level."

The report says that on average, inflation-adjusted house prices in these cities have historically held stable at between $150,000 and $220,000 in today's dollars but current housing prices in all six major cities are now over $300,000 on average.

................

The report says Calgary saw housing prices soar by 198 per cent between 1997 and 2007.
Under three different scenarios, the report looks at the possibility of a market correction through housing price deflation, the possibility of a deeper and longer housing crash and the possibility of a rapid and steep decline.
Under the first scenario, Calgary would see an almost 20 per cent decline in prices from $403,000 today to $325,000 in three and a half year's time. If the bubble burst slowly over a period of time, the report says Calgary would experience at least a 30 per cent drop from today's prices to just over $280,000.
And under the worst-case scenario, Calgary would see a 30 per cent plunge in prices.

Read more: http://www.calgaryherald.com/busines...#ixzz0yEqOSiXf

[pepper24]

Another view of the market......

There is little likelihood of a U.S. style surge in foreclosures or a collapse of house prices, says a report released today by the C.D. Howe Institute.

The report said recent swings in Canadian house prices have raised concerns that a U.S. style housing bust looms on the horizon and many of the concerns about the Canadian housing market are motivated by recent U.S. experiences.

"Canadian housing policies, which avoided the sharp decline in underwriting standards seen in the U.S., worked well in reducing the possibility of a housing bust in Canada during 2008-2009, and continue to mitigate the risk of a massive wave of defaults in the future," said the report.

Earlier in the day, the Canadian Centre for Policy Alternatives released its report says the six hottest real estate markets in Canada, including Calgary, could be in for a correction at best or, at worst, a bubble burst because price increases between 1980 and 2010 were outside of a "historic comfort level."

Read more: http://www.calgaryherald.com/busines...#ixzz0yEqtViES

[pepper24]

Originally Posted by pepper24

The report, Canada's Housing Bubble: An Accident Waiting to Happen, which looks at trends in house prices in Calgary, Toronto, Vancouver, Edmonton, Montreal and Ottawa, says that between 1980 and 2010 increases were "outside of a historic comfort level."

The report says that on average, inflation-adjusted house prices in these cities have historically held stable at between $150,000 and $220,000 in today's dollars but current housing prices in all six major cities are now over $300,000 on average.

................

The report says Calgary saw housing prices soar by 198 per cent between 1997 and 2007.

Under three different scenarios, the report looks at the possibility of a market correction through housing price deflation, the possibility of a deeper and longer housing crash and the possibility of a rapid and steep decline.

Under the first scenario, Calgary would see an almost 20 per cent decline in prices from $403,000 today to $325,000 in three and a half year's time. If the bubble burst slowly over a period of time, the report says Calgary would experience at least a 30 per cent drop from today's prices to just over $280,000.
And under the worst-case scenario, Calgary would see a 30 per cent plunge in prices.

Read more: http://www.calgaryherald.com/busines...#ixzz0yEqOSiXf

My view:

It won't be as bad as the US with 40-60% drops like CA, FL, NV, AZ etc but a 20-30% drop is not out of the question. Affordability is a huge concern (house prices are anywhere from 4.7 to 11.3 times the median income) and record low interest rates are due to rise (how quickly is key). The huge rise before the recession was driven by cheap money and the party is ending.

This jumped out for me from the article........

Before 2000, house prices tended to hover with a narrow range of between three and four times provincial annual median income. Today, house prices are anywhere from 4.7 to 11.3 times the median income, says the report.

This is median, not average which is even more significant. The ratios will get even worse once rates rise.

I was out for drinks with my realtor on the weekend and a lot of decent homes that have been on the market for only a few months have had to cut their asking price as much as $100K. People are learning the hard way that this is a different market. These are nice homes in the $500-700K range in viable areas like Lake Bonavista. Not mansions but decent homes in stable, family communities. The drop is all to market not because the homes aren't nice according to her.

Hold on tight!

[chemgear]

Originally Posted by pepper24

There is little likelihood of a U.S. style surge in foreclosures or a collapse of house prices, says a report released today by the C.D. Howe Institute.

Well, I distinctly remember when people were saying there was "little likelihood" of ANY drop in prices due to the "tighter lending standards of the more responsible banking system in Canada." And yet, here we are.

Originally Posted by pepper24;2653073
[COLOR=#000000

Before 2000, house prices tended to hover with a narrow range of between three and four times provincial annual median income. Today, house prices are anywhere from 4.7 to 11.3 times the median income, says the report.[/COLOR]

This is median, not average which is even more significant. The ratios will get even worse once rates rise.

I was out for drinks with my realtor on the weekend and a lot of decent homes that have been on the market for only a few months have had to cut their asking price as much as $100K.People are learning the hard way that this is a different market.

I think agree with you - I'm sure we're all familiar with the "It's totally different in <insert city name here>. We have: oil, gas, the olympics, restricted land space, immigrants, asian money, resources, the ocean, etc." At the end of the day, I'm still very much stuck on the numbers along with those ratios/fundamentals and try to avoid the emotional unquantifiables.

Also very anecdotally, I have watched a few listings on my radar get cut by $250-400k and still not sell for nearly a year. On the other hand, another has never deviated in price for more than a year and a half - of course unsold.

[chemgear]

August (unofficial) numbers from http://calgaryrealestatereview.com/

The month-end average price for SFH was $445,617. This was down 4.1% from July and down 1.9% from August 2009. The median was $395,000 which was down 1.25% from both last month and the previous August when it was $400,000.

There were a total of 867 transactions which was lower than the 915 recorded last month and down 32% from the 1277 in August 2009.


Condos are roughly similiar. Prices down about 6-8% (median versus average) in the last 3 months. Inventory is still pretty stable at 6 months of supply with about 250 listings expiring at month end - would one describe this as "pent up supply?"

[troutman]

Originally Posted by chemgear

August (unofficial) numbers from http://calgaryrealestatereview.com/

The month-end average price for SFH was $445,617. This was down 4.1% from July and down 1.9% from August 2009. The median was $395,000 which was down 1.25% from both last month and the previous August when it was $400,000.

There were a total of 867 transactions which was lower than the 915 recorded last month and down 32% from the 1277 in August 2009.


Condos are roughly similiar. Prices down about 6-8% (median versus average) in the last 3 months. Inventory is still pretty stable at 6 months of supply with about 250 listings expiring at month end - would one describe this as "pent up supply?"

Question - when do they record the transaction? When the offer is accepted, or on the closing date (often 1-2 months later)?

[cmyden]

Originally Posted by troutman

Question - when do they record the transaction? When the offer is accepted, or on the closing date (often 1-2 months later)?

I believe it's somewhere in between, when it 'firms up' (the term I hear realtors use) and becomes unconditional. The deal becomes firm and binding, and both parties are waiting for the closing date. The sales info is then sent to the real estate board and the property is marked as sold.

[Clarkey]

Originally Posted by chemgear

Congratulations on the new place!

Thanks, I tried to wait out the market a bit but at the end of the day I opted to pull the trigger on a house to settle into for my family. My wife's pregnant again and the nesting phenomenon cannot be ignored, regardless of where the market is headed!