2007 review

The MLS Rent vs. Buy calculator which had always advised to buy has been removed. See original post.

Edmonton Real Estate Board removes false information from their June 2007 press release without correction.

Confusing Comfree sales statistics sold to listings change to sales success and removed afterwards.

Calgary Real Estate Board spinning seasonality and changing graphs but nothing too overt.

Edmonton Journal uses quote from 2005 'Bubble Watch' study in 2007 article. The 2005 study referred to Edmonton not being a bubble before prices doubled. Small two line correction put into print afterwards but not online. See article and the study from 2 years earlier.

Alberta mortgage brokers encourage not reporting income as described by revenue Canada and setting up illegal basement suites to GIT-R-DONE.

CMHC encourages gambling.

Cheers! Have a safe and happy New Year!

NEWSFLASH: It's not 1992

There is an article in the Edmonton Journal titled Buy sooner rather than later. The writer was bold enough to buy a townhouse in Edmonton for $55,000 in 1992 and uses this example to make the case for first time buyers to get on the property ladder.

Regardless of the boom and the city you live in, buying your first home is always tough.

However, In the 1990s buying a home in Edmonton was easier. And if you waited a year or so it was no big deal. Below is a chart of % after tax household income dedicated to mortgage payment from RBC Housing Affordability study. Note how all property types are currently less affordable now than at any other time in the chart range.


This number takes into account wages and interest rates so it is a good picture of relative difficulty of getting into the market. It assumes a 25% down payment which is much more difficult to get now because of the appreciation of the last few years. The author of the article was prudent enough to save $10,000 or 18% down payment in 1992 and gives the following advice:

Buy what you can afford: I know you might think it's tough in this market but don't push yourself to the limit.

Too many people are stretching amortization periods and putting down very small down payments.

The cheapest 2 bdrm townhouse in west Edmonton is currently about $200,000. An equivalent 18% down payment today is $36,000. How is it possible to buy sooner rather than later and save up that kind of money? To illustrate see the following average price chart for Edmonton showing both nominal and inflation adjusted prices. A certain percentage down payment will be proportional to the nominal amount and its relative size in terms of buying power would be proportional to the inflation adjust series.


Bottom line is the article is simply not applicable in 2007 Edmonton.

keep scrolling, you'll find them

Below is a table of median single family homes across the U.S. with some Albertan locations thrown in. No adjustment was required in currency. Alberta info from November MLS reports. US data from CNN.

Also interesting is Canadian interactive pricing map (These stats are averages and include condos).

City	State	Median
Youngstown-Warren-Boardman	OH - PA	$81,600
Saginaw-Saginaw Township North	MI	$84,900
Decatur	IL	$85,900
Elmira	NY	$93,300
South Bend-Mishawaka	IN	$95,200
Ft. Wayne	IN	$101,300
Erie	PA	$103,800
Toledo	OH	$107,100
Cumberland	WV	$107,700
Buffalo-Niagara Falls	NY	$110,900
Springfield	IL	$111,200
Davenport-Moline-Rock Island	IA - IL	$114,600
Canton-Massillon	OH	$115,700
Waterloo/Cedar Falls	IA	$115,800
Topeka	KS	$117,100
Wichita	KS	$118,800
Binghamton	NY	$119,600
Dayton	OH	$121,400
Rochester	NY	$123,000
Amarillo	TX	$123,100
Charleston	WV	$123,400
Indianapolis	IN	$123,500
Akron	OH	$124,700
Syracuse	NY	$124,900
Rockford	IL	$125,100
Peoria	IL	$125,200
Springfield	MO	$127,000
Pittsburgh	PA	$127,700
Appleton	WI	$128,500
Grand Rapids	MI	$128,600
Beaumont-Port Arthur	TX	$129,100
Oklahoma City	OK	$130,000
Little Rock-N. Little Rock	AR	$131,600
Cleveland-Elyria-Mentor	OH	$132,700
Chattanooga	TN - GA	$133,200
Lansing-E.Lansing	MI	$133,700
Spartanburg	SC	$134,400
El Paso	TX	$135,800
Mobile	AL	$136,300
Lincoln	NE	$138,800
Shreveport-Bossier City	LA	$140,200
Corpus Christi	TX	$140,500
Memphis	TN - MS - AR	$141,300
Louisville	KY - IN	$141,900
Kankakee-Bradley	IL	$142,100
Champaign-Urbana	IL	$142,600
Omaha	NE - IA	$142,800
Detroit-Warren-Livonia	MI	$142,900
Gary-Hammond	IN	$144,300
Cincinnati-Middletown	OH - KY - IN	$145,300
Jackson	MS	$145,400
Fargo	ND - MN	$145,700
Dallas-Fort Worth-Arlington	TX	$146,800
Sioux Falls	SD	$147,100
Montgomery	AL	$148,400
Columbia	SC	$149,500
Lexington-Fayette	KY	$150,100
Saint Louis	MO - IL	$150,500
Columbus	OH	$151,600
Des Moines	IA	$153,900
San Antonio	TX	$154,700
Greensboro-High Point	NC	$155,500
Bloomington-Normal	IL	$155,800
Houston-Baytown-Sugar Land	TX	$155,800
Kansas City	MO - KS	$157,000
Knoxville	TN	$158,400
Gulfport-Biloxi	MS	$159,200
Greenville	SC	$159,600
New Orleans-Metairie-Kenner	LA	$160,200
Ocala	FL	$160,800
Bismarck	ND	$161,600
Green Bay	WI	$162,900
Reading	PA	$162,900
Yakima	WA	$163,200
Birmingham-Hoover	AL	$165,900
Pensacola-Ferry Pass-Brent	FL	$170,000
Glens Falls	NY	$170,700
Kennewick-Richland-Pasco	WA	$172,300
Tallahassee	FL	$174,300
Atlanta-Sandy Springs-Marietta	GA	$175,300
Baton Rouge	LA	$176,700
Palm Bay-Melbourne-Titusville	FL	$182,400
Durham	NC	$186,900
Austin-Round Rock	TX	$188,200
Jacksonville	FL	$189,200
Farmington	NM	$190,400
Deltona-Daytona Beach-Ormond Beach	FL	$195,000
Albany-Schenectady-Troy	NY	$204,500
Albuquerque	NM	$204,800
Gainesville	FL	$206,600
Spokane	WA	$206,800
Hagerstown-Martinsburg	MD - WV	$208,400
Boise City-Nampa	ID	$209,000
Charleston-North Charleston	SC	$212,300
Springfield	MA	$214,900
Pittsfield	MA	$215,300
Tampa-St.Petersburg-Clearwater	FL	$218,300
Dover	DE	$219,800
Charlotte-Gastonia-Concord	NC - SC	$220,100
U.S.		$220,800
Colordo Springs	CO	$222,400
Raleigh-Cary	NC	$229,500
Minneapolis-St. Paul-Bloomington	MN - WI	$229,600
Milwaukee-Waukesha-West Allis	WI	$231,100
Madison	WI	$234,500
Salem	OR	$235,400
Cape Coral-Fort Myers	FL	$236,700
Richmond	VA	$238,800
Eugene-Springfield	OR	$241,900
Philadelphia-Camden-Wilmington	PA - NJ - DE	$243,000
Tucson	AZ	$244,800
Portland-South Portland-Biddeford	ME	$245,900
Salt Lake City	UT	$246,700
Denver-Aurora	CO	$254,100
Virginia Beach-Norfolk-Newport News	VA - NC	$255,000
Phoenix-Mesa-Scottsdale	AZ	$255,500
Norwich-New London	CT	$266,000
Orlando	FL	$266,800
Kingston	NY	$269,500
Hartford-West Hartford-East Hartford	CT	$270,100
Allentown-Bethlehem-Easton	PA - NJ	$272,900
Atlantic City	NJ	$273,100
Worcester	MA	$282,800
Chicago-Naperville-Joliet	IL	$286,400
Sarasota-Bradenton-Venice	FL	$287,400
Providence-New Bedford-Fall River	RI - MA	$291,000
Baltimore-Towson	MD	$291,400
New Haven-Milford	CT	$292,400
Las Vegas-Paradise	NV	$295,500
Portland-Vancouver-Beaverton	OE - WA	$299,700
Reno-Sparks	NV	$317,300
Trenton-Ewing	NJ	$328,600
Sacramento--Arden-Arcade--Roseville	CA	$335,700
Miami-Fort Lauderdale-Miami Beach	FL	$346,800
Edmonton CMA	AB	$355,000
Boulder	CO	$367,500
Riverside-San Bernardino-Ontario	CA	$377,000
NY: Edison	NJ	$391,800
Seattle-Tacoma-Bellevue	WA	$394,700
Barnstable Town	NA	$400,600
Calgary City	AB	$407,500
Boston-Cambridge-Quincy**	MA - NH	$414,700
Washington-Arlington-Alexandria	DC - VA - MD	$438,000
NY: Newark-Union	NJ - PA	$459,700
NY: Nassau-Suffolk	NY	$470,000
New York-Northern New Jersey-Long Island	NY - NJ - PA	$476,100
Bridgeport-Stamford-Norwalk	CT	$491,100
New York-Wayne-White Plains	NY - NJ	$550,900
Los Angeles-Long Beach-Santa Ana	CA	$588,400
San Diego-Carlsbad-San Marcos	CA	$589,300
Fort McMurray (Average)	AB	$635,325
Honolulu	HI	$649,900
Anaheim-Santa Ana	CA	$700,700
San Francisco-Oakland-Fremont	CA	$825,400
San Jose-Sunnyvale-Santa Clara	CA	$852,500

CMHC forecast changes

Here are some forecast changes by CMHC over 2007 in the following reports:

CMHC Housing Market Outlook Spring 2007
CMHC Housing Market Outlook Fall 2007
CMHC Rental Market Report 2007

CMHC has changed their forecast(s) for Edmonton a couple of times this year.

Vacancy and two bedroom rent:

This spring the outlook on vacancy was 0.7% the actual vacancy was 1.5%.

Spring 2007 Housing Outlook
2007(f) 0.7% $970
2008(f) 0.5% $1115

Fall 2007 Housing Outlook
2007(f) 1.0% $950
2008(f) 0.8% $1090

October 2007 survey
2007 1.5% $958

MLS Sales

The forecast for sales in 2007 was cut by almost 3,000 and may be lower after December's count.

Residential Sales

Spring 2007 Housing Outlook
2007(f) 24,000
2008(f) 22,600

Fall 2007 Housing Outlook
2007(f) 21,200
2008(f) 20,000

November EREB YTD sales 19,687, assuming 1000 sales in December:
20,700

The forecast change for listings increased from 28,000 to 38,000.

EREB - Edmonton Average Price and Analysis

Below is a chart which takes a few quotes from the Edmonton Real Estate Board and places them on a Average price chart.


March - “There are lots of stories about the slowdown or reversal of certain American housing markets,” said Pratt. “But all markets are local and Edmonton is unique in that the fundamentals of low interest rates, strong demand, low inventory, steady in-migration and high consumer confidence are still driving our local economy.”

April - “Price increases may moderate slightly as the market returns to pre-boom levels but I do not anticipate that actual prices will decrease.”

May - “With the average price of a single family dwelling rising by over $400 a day, you need the latest market figures that only a REALTOR® can provide.”

June - “The fundamentals of the Edmonton market are still strong and should sustain steadily rising prices for all classes of property,”

August - “REALTORS® are optimistic and see any price dips as temporary and within the normal range for this market.”

November - “As the current listings become sold or are withdrawn the current inventory will drop. As we move into the spring with a more normal inventory, we expect that prices will again begin to rise slowly,"

Update (thanks rj):


Added another chart based on the quote found in the Edmonton Journal April 4, 2007.

In only the first three months of this year, average home prices have climbed 12.4 per cent, so Pratt has abandoned her earlier forecast of a 15 per cent increase for the full year.

"We're predicting that prices will continue to rise until August, at four to five per cent per month, then at two per cent per month," she said today.

This chart compares the prediction made by the EREB after March stats were released to what has actually happened.

Typical Spin

Typical season slow down comes to the MLS(R) during the month of November 2007, according to figures released by the Calgary Real Estate Board (CREB(R))

Single family Calgary metro sales for November 2007 were 1,103, a decrease of 21 per cent from the 1,397 sales recorded in November 2006...

link

Sales in November 2007 21% less than November 2006.
Sales in November 2006 11% less than November 2005.
CREB Nov 2006

It's getting cold out there.