According to the REALTORS® Association of Edmonton the average price of housing increased slightly in January as compared to the previous month. The all-residential average price rose three quarters of a percent to $310,766; up from $308,497 in December. Single family homes rose a quarter of a percent while condo prices dropped just over one percent during the month.

Residential sales of 735 were on par with December sales (834) and sales in January 2009 (775) but off 21% from the same month last year (931). Residential listing activity rose from 1,102 units in December 2010 to 2,142 units in January. Inventory of homes on the Multiple Listing Service® System decreased from 5,721 at year end to 5,633 as of January 31.

“Traditionally the market dips in December but inventory starts to build in January to supply the spring market,” explained REALTORS® Association of Edmonton President Chris Mooney. “Prices are up slightly but the cold weather seems to have kept buyers and sellers out of the market. We expect sales activity to increase along with spring temperatures and continue all through the first two quarters.”

The average* price of single family dwellings in January was $356,276 with a median price of $349,900. Condo average price was $220,993 with a median of $214,000. Duplex and rowhouse prices also dropped on average from $315,163 to $297,587 a 5.6% drop. All prices reflected sales across the entire Edmonton region including surrounding communities and counties.

Mooney suggested that changes to mortgage qualification rules would not have the same effect that last year’s rule changes had. “In 2010, people reacted early to the changes and completed their home purchases earlier than usual. The reduction from 35 to 30 year amortization limits will come into effect on March 18 but we do not expect it to affect a large number of purchasers,” said Mooney.

The average days-on-market in January was 67 days up from 53 last year. The residential sales-to-listing ratio was a low 34% in January and total MLS® System sales were almost $253 million. 

The average price for a single family detached home in December was $355,270, down about $10,000 as compared to the price in November. The average condo price dropped less than $6,000 to $223,454. The marginal price reduction (down 2.7%) continued a SFD slide that started in June when average prices were over $390,000. Condo prices peaked at $252,700 in April and have continued a relentless march downward since then.

The REALTORS® Association of Edmonton released month end and year end results for sales through the local Multiple Listing Service® and includes all residential sales for the City of Edmonton and surrounding communities and counties.

As compared to December 2009, single family prices were down 2.7% and condo prices were off by 7.2%. The average price of all residential property sales in December was down 2.0% as compared to a year ago.

“Homebuyers are watching housing prices slide and may attempt to catch the market at the bottom by delaying their purchase but the low point is only evident about three months after it is reached,” said Larry Westergard, President of the REALTORS® Association of Edmonton. “Home sales are still happening each day and by waiting, the wary buyer may miss the ideal home.”

He urged home sellers to also watch the pricing trends to ensure that their home was appropriately priced relative to the market. “Market activity will pick up again in the spring as usual according to trends,” said Westergard, “Keep your REALTOR® on speed-dial to ensure you have access to the latest market figures.”

Residential sales activity in December was off 34% (784 sales) as compared to November but fewer homes (1,110) were listed and that reduced the available inventory by 18% to 5,721 residential properties on the Edmonton MLS® System. The average days on market rose from 59 to 66 days.

Year-over-year, the all-residential price (includes all single family, condominiums, duplex/rowhouses and mobile homes sold through the year in the Edmonton area) rose 2.6% from 2009. The SFD price rose 3.52% and condos rose 1.89% for the year. REALTORS® sold a total of 18,293 properties of all types in 2010 which was down 14% from 2009. They listed 40,597 properties which is up 7.6% from the previous year. Total Edmonton MLS® System sales were valued at $6.12 billion: a 12% drop from 2009.

Housing prices soften as sales bump up

The average price of a single family detached property in the Edmonton area continued to soften in November. According to the REALTORS® Association of Edmonton, at $362,657, the average* SFD price was half a percent lower in November than it was in October. Compared to a year ago the price was down significantly by 2.5%. November condo prices also took one of the biggest drops this year with the average price down 2% to $229,603 month-over-month and just under 3% year-over-year. Average duplex/rowhouse prices of $318,605 went up over the previous month (6%) and previous year (10.6%).

Despite the softening of prices in specific categories, overall the market remained stable with the all-residential average price of $319,479 (up 0.65%) from October and up a third of a percent from last year. There were 1,120 residential sales on the Edmonton Multiple Listing Service® in November as compared to 1,077 in October. Listings were down from 2,267 in October to 1,860 in November. This resulted in a drop in the available inventory from 7,689 to 6,982 residential units; still considered high for this market.

“Softening prices, a dip in interest rates, increasing sales nationally and excess local inventory all contributed to a month-over-month sales bump,” said Larry Westergard, president of the REALTORS® Association of Edmonton. “Housing affordability in Edmonton is lower than the national average and economic growth in Alberta is expected to exceed other parts of the country.”

The sales-to-listing ratio in Edmonton and area was 66% and the average days-on-market was down from 60 to 59 days. Taken together the two figures indicate that sellers must exercise patience as they wait for a buyer. They should be encouraged to learn that there was over $400 million worth of real estate sold through the local MLS® System in November.

“It seems that Edmonton is out of phase with the rest of the country and is lagging slightly in comparison to other major markets,” said Westergard. “All the indicators suggest that an increase in real estate sales is right around the corner. Your REALTOR® will continue to monitor the local market and provide appropriate advice for each specific property.”    

Edmonton, November 2, 2010: Although the all-residential average price dropped 3% in October, average prices are almost exactly what they were a year ago. Single family dwellings were sold on average for $365,691 which is just $1,434 less (-0.39%) than October 2009. Condos sold in October for about $2,000 less (-0.9%) than a year earlier at an average price of $235,893.

“Stability is the key word for the Edmonton housing market,” said Larry Westergard, president of the REALTORS® Association of Edmonton. “Prices this fall are matching almost dollar for dollar with prices for the past two years. But I am pleased to report that the inventory dropped 10.6% in October, and as it returns to a more normal level, prices will start to move.”

The average* all residential price in October was $317,422 as compared to $327,235 in September. It was less than one percent lower than the October 2009 price of $320,184. Listing activity continued to slow with just 2,269 residential properties added in October. There were 1,077 residential sales for a sales-to-listing ratio of 44.5%. Total residential inventory was 7,689 properties at the end of October as compared to 8,602 the month prior. The average days-on-market went up to 60 days from 56 last month.

The all-residential median price rose from $306,500 in October 2009 to $308,000 last month. “This rise in the median price stretched the range of the lower end of the market,” said Westergard. “Yet REALTORS® still found 529 properties priced under $300,000 for buyers with smaller budgets or modest housing needs in October. There is still a home suitable for every buyer in this market.” There were 32 sales of residential properties priced at over $750,000 during the same month.

Housing prices in the Edmonton area remained stable as we enter the final quarter of the year. Single family dwelling prices in September mirrored prices in August and condo prices rose slightly after four months of decline. Both listings and sales declined in September as compared to a month ago.

“The market seems to be resting,” said Larry Westergard, president of the REALTORS® Association of Edmonton. “After the turmoil of the past couple of years and the rush to buy in the early part of the year, it seems that consumers are just sitting back and waiting to see what comes up next.” There are still over 8,600 residential properties in the local inventory and buyers have lots of choice.

The average* price of a single family property was up $472 and sold for $370,653 in September. Condominiums, which have dropped in price for four consecutive months, rallied and sold on average for $238,822 last month. The slightly less than 1% price increase did not reverse drops from a high of $252,728 in April. The duplex/rowhouse average price was down 11% to $313,462 but tends to vary widely from month to month. The residential sale price (which includes all types of residential property) was $326,499; down less than a quarter of a percent from last month.

Residential sales in September were down from the previous month at 1,187 as were listings at 2,668. This sales-to-listing ratio was 47% and the average days-on-market was unchanged at 57 days.

“The third quarter activity was identical to the first quarter this year,” said Westergard. “Typically we see sales dropping from Q2 to Q3 but remaining higher than Q1. This reflects a very active market in the first part of the year which was spurred on by financial incentives and the threat of increasing interest rates.” 

The Bank of Canada hiked rates another 25 basis points on Wednesday morning, and left some economists with the impression that it may yet continue to hike.

In the policy statement accompanying Wednesday’s rate decision, the bank indicated that further rate hikes will be “carefully considered in light of the unusual uncertainty surrounding the outlook.” That outlook has dimmed somewhat of late, leading some economists to expect that the central bank will be pausing its hikes. Indeed, while Wednesday’s rate rise was widely expected, it wasn’t viewed as a slam dunk.

Ahead of Wednesday’s announcement, a common view was that the bank would suggest that the rate hikes may cease while the recovery falters. But the bank didn’t seem to tack very far in that direction.

HSBC Securities (Canada) Inc. says that the statement’s tone “is considerably firmer than may have been anticipated”, and that it “to some extent challenges the market view” that Wednesday’s meeting would mark the a pause in the rate hiking cycle. HSBC is one of the few market observers that is expecting the bank to continue its rate hikes this year.

TD Economics says that it is “evident from the communiqué that the bank is in highly reactive mode. In the absence of clarity surrounding the outlook, there is no commitment or hint to either a pause in the tightening cycle or the continued gradual nudging of interest rate higher. Key economic and financial indicators over the next six weeks will ultimately decide the next decision on October 20.”

Economists at RBC Capital Markets say that “lingering worries about the U.S. economic outlook will likely be a contributing factor to the Bank of Canada stepping to the sidelines.” While domestic conditions remain very expansionary, the weaker external environment will hamper Canada’s recovery, it suggests. “Against this backdrop, we expect the bank to hold the policy rate at 1% to assess the effect of the 75 bps of tightening undertaken to date on the domestic economy,” it says. However, it also suggests that the pause will be a brief one.

TD says that the odds favour the Bank of Canada pausing for some time. It currently does not anticipate another tightening before March of next year. TD says that the bank’s view on the economy in the July Monetary Policy Report is far too rosy, and the fact that in today’s statement it suggests that its view has dimmed, but only slightly, “raises the possibility that the bank remains too optimistic.”

In the opinion of TD Economics, the Canadian economy will be hard pressed to expand by 2% next year, it says, noting that it faces both external and domestic headwinds. While the bank anticipated in July that the economy will be back to full capacity by the end of 2011, TD Economics anticipates that it will take at least two quarters longer to reach that goal.

“The implication is that soft economic numbers are anticipated in the coming months. Indeed, we expect that the unemployment rate could edge higher in the near term and core inflation is expected to dip towards 1.4% in early 2011. This outlook suggests that a pause in the tightening cycle could easily occur,” TD concludes.

However, BMO Capital Markets observes that the Bank of Canada clearly retains its tightening bias, and it observes that it “seems generally unfazed by the recent cooling in the Canadian economy.”

“While we had been expecting the Bank to now move to the sidelines for a spell, it appears that it will take a deeper slowdown in domestic spending (as we suspect) than what we have seen so far to prompt them to stop raising rates,” it concludes.

National Bank Financial agrees that the overall tone of the report does not suggest that the bank is getting ready to pause in its rate increases. It says its own assessment about the downside risks to global recovery in the second half of 2010 is gloomier than the Bank of Canada seems to hold.

“We feel that a tactical pause this month would have been easily justified given the loss of economic momentum already apparent in the U.S. and starting to show in the Euro-zone. Unless more clouds gather on the horizon over the coming weeks, our forecast calling for a 1.5% overnight rate with a Canadian dollar at par against the USD by Q1 2011 will occur faster than what we had envisaged,” it says.

The average* priced single family property was down 1.96% and sold for $372,253 in August. Condominiums dropped in price for the fourth consecutive month and sold on average for $232,230 in August. The duplex/rowhouse average price was up 16.7% to $352,662 but based on just 56 sales so the average may be skewed by the selection of properties sold. The average residential sale price (which includes all types of residential property) was $325,588; down just 1.3% from last month.

“Although the market has quieted this summer the inventory is being constantly refreshed,” said Westergard. “Our 3,200 REALTORS® are listing 50 to 100 properties every day and wide choice is available in all areas. We don’t expect a big push this fall but homes are selling although the sales cycle is longer than many sellers would like.”

The large inventory of 8,892 residential properties available at month end dampened both listings and sales. New listings were off 15% from last month and 3.3% from last July. Sales dropped from 1,741 in June to 1,294 in July (a 15% drop). The sales-to-listing ratio was 43.8% (down from June). As you might expect, sales were also slower and the average days-on-market was up 4 at 51 days. "A well presented property with the right price might still attract multiple offers," said Westergard. "Most buyers are receiving the expert advice of their REALTOR® and getting access to day-to-day changes to numbers and sales results. It is critical that sellers remain in contact with their REALTOR® and be prepared to modify the price as the market moves." Residential inventory is expected to follow a seasonal trend and fall through the latter part of the year leading to a more balanced market and price stability.

The week ahead: Canadian investors look to Bank of Canada interest rate decision 

 

Source: The Canadian Press

Canadian investors will look to the central bank’s interest rate decision for guidance this week, while U.S. markets are hoping earnings reports from a slew of major companies will help offset some abysmal economic data.

The Bank of Canada is expected to raise its key lending rate by a quarter percentage point Tuesday to 0.75%, another indication that Canada’s economic recovery has so far been stronger and faster than in the United States.

An interest rate hike by the Canadian central bank in a move to fight inflationary pressures in the economy could put some pressure on stock markets as they price in “greater odds of follow-up moves through October,” noted Avery Shenfeld, chief economist at CIBC World Markets.

News earlier this month that the Canadian economy created a whopping 93,200 new jobs in June, taking the country’s unemployment rate below 8% for the first time since the depths of the recession, “more or less put the lid on the question” of whether the central bank would hike interest rates, said Doug Porter, deputy chief economist at BMO Capital Markets.

“I wouldn’t say things are back to normal but they’re moving rapidly in that direction, at least in Canada,” Porter said.

“In that kind of environment, there is very little justification for extraordinarily low interest rates such as we still have in this country.”

Canadian businesses also helped pave the way for an interest rate hike in a key quarterly survey last week, indicating they were generally upbeat about the outlook for business activity over the coming year.

Half the firms surveyed by the Bank of Canada said they planned to add workers over the next 12 months, compared to only 10% that planned to cut their workforce.

Porter said he expects the central bank’s lending rate to reach 2.5% by the end of 2011. However, he added that he expects the central bank to continue using “very cautious language” for the time being.

While an interest rate hike and the Bank of Canada’s assessment of the economic recovery will impact investors, fallout from a slew of weak economic data in the U.S. will also weigh on markets this week.

Colin Cieszynski, market analyst at CMC Markets Canada, said Canada with its strong economy and low borrowing costs “is just about the only place where people are talking about raising interest rates.”

“Certainly in the U.S. they’re not, and in fact the Fed even said that if things slow down too much they’ll bring back more emergency measures.”

Major stock markets in Toronto and New York ended last week in the red following a much weaker-than-expected consumer confidence reading out of the U.S. on Friday, some uninspiring manufacturing data, soft retail sales numbers, a lower economic growth forecast from the Fed and a miserable jobs report for June.

Housing data out of the States this week could continue to pressure markets. Housing starts, due out on Tuesday, are projected to drop 5% for June, while existing home sales, which will be reported Thursday, are expected to fall 10% for the same month.

“I think we’re back to where we were about a year ago in terms of expectations for the recovery,” Porter said.

“Economists, analysts, the markets all have come to grips with the reality that we are coming back down to earth.”

However, the impact of weakening housing data could be mitigated if major companies slated to report earnings next week are able to impress, Cieszynski said.

“Right now you’ve still got a bit of fear out there, but if you do start to see large numbers of positive surprises pile up again, it should help to stabilize the markets,” he said.

 

“External influences pulled sales activity into the first four months of the year which reduced the demand in May and June. Overall there were 680 less residential sales in the first half of the year as compared to 2009,” said Westergard. “Consumers still seem interested in getting into the housing market or moving up but seem to be resting after a confusing period of uncertainty and change in the conditions that surround a property purchase.” He emphasised that despite seasonal changes the local market is stabilizing and operating in a normal manner. “The frenetic days of the past few years look to be behind us now and it appears that the more calm, cool and collected market that we are used to in Edmonton is on the horizon”.

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REALTORS® face relaxed housing market with stable pricing

 

The housing market was relaxed in May with slightly lower sales than last year and prices generally stable. Despite the sales drop, the current sales figures compare favourably with levels set in 2008.

 

“Financial incentives, changes to mortgage qualifying rules and the threat of increasing mortgage rates caused the local market to peak a little earlier this year,” said Larry Westergard, president of the REALTORS® Association of Edmonton. “Many buyers exercised their options in April leaving the customer base a little leaner in May.”

 

Single family residences in the Edmonton area rose in price by less than one percent and sold on average* for $390,583 in May. Condominium prices dipped just two percent to an average of $248,526. Duplex and rowhouse prices of $320,204 were down 2.3% from last month. Overall, the average residential price was up a quarter of a percent to $340,192.

 

There were 3,670 residential listings in May with residential sales of 1,682 properties resulting in a sales-to-listing ratio of 46%. The average time to sell a home was 44 days (the same as April) and inventory at month end was 8,780 residential units (as compared to 8,056 in April). At current sales levels the inventory will last for over five months.

 

“Buyers, sellers and REALTORS® can all relax and enter a sales transaction without pressure,” said Westergard. “That does not mean that you can delay making or accepting an attractive offer because 50-60 homes sell each day and you would hate to see your dream home snapped up by someone just a little more eager to live there.” He emphasized that the REALTOR® can be a calming influence in a sale but can also be relied upon to provide expert advice and coaching.