Lots of discussion on the economy these days. Where is it at and where is it going? Plenty of uncertainty for the States and more discussion continues on the potential ramifications for Canada. For what it’s worth there are a number solid fundamentals in Alberta that haven’t changed over the last 6 months and several that have. It’s hardly up to me to tell you what you should make of everything that is being put out in the media or even on here.
So I’m certain that we’ll have some discussion regarding the Economic Development Edmonton Outlook for 2008. The title of their Outlook is "Edmonton. Powehouse redefined." Click on the title to view the full report.
Should I sell my house now, regardless of the price? I WOULD LIKE SOME ADVICE
Up until now, I believed the EREB and Comfree reports. I am starting to panic now!
I bought the house back in 2005 for about half of what it was recently appraised for. But this report from the City of Edmonton gives me shivers!!
Although it is largely positive about the distant future (distant future is much more difficult to predict and is based on oil price), it shows a DECREASE in real income y/y in 2008! I mean, not a slower increase but a real-life decrease!! Despite sky-high oil price. If Edmonton goes down in real income per capita when the oil is so high, when is it ever going to do better????
I mean there are many other positive indicators but I always believed that real income per capita is the most important one.
Does this not mean that the housing prices will plummett within 6 months?
Is it best to sell it now?
Sam, or should I say Jhordan, Jess, Steven and whatever other aliases you like to go by. How interesting you often pose your questions like a desperate seller or a frustrated buyer. What is the real point of your post and why can’t you come straight out and say it.
Dear Sheldon,
My point is rather obvious, I think. As per “DECREASE in real income y/y in 2008! I mean, not a slower increase but a real-life decrease!!”, my point is indeed obvious.
The title of your article from the City of Edm, paints a negative picture. The real title is “… Powerhouse Redifined” which have manipulated to suggest “…Powerhouse, question-mark”. Good trick.
Powerhouse redifined, is a play on words – it can certainly mean powerhouse, going down.
My question is that I have already made my money, why would not I drop the price to sell it…or should I wait for it to tick up?
EREB has been suggesting that I should wait – but if real incomes are going to be down even by the generally bullish City of Edm report, I feel like the bottom is likely to fall out.
The bottom line is, even for speculators like me, realtors should rpovide good advice. Why not give us a good idea about the when we should sell?
Sam, you have answered your own question, you think market will go down and you want to sell now, but greed of “maybe it will go up” is stopping you, so give up the greed and sell, if you want to sell now. Besides no one really knows, most realtors may think it will go up, it is possible but maybe it is not. If you think you have made your money, then why ask?
Sam,
It would be irresponsible for me to give specific advice with out knowing all the facts. You want advice talk to your REALTOR and your other team members. It could depend on where your property is and what you have.
Otherwise the advice you’ll get from me and others on this blog will be very general and may not be specific enough for your circumstances.
Sheldon,
can I ask you what do you think of buying a brand new house in Beauval area which is 1832 sqft 2 storey, and walk-out basement, lakeside. It is mac and mitch home, possession is in Feb, A friend of mine is selling it for 450,000, do you think it is a good deal or not?
sorry forgot to mention it is in beaumont area.
I personally think that the .pdf study/forecast issued by the city of Edmonton was a bit influenced by what was forecasted last year by many other private and governmental assessments: two years’ 6% hike in GDP in Edmonton is hard to cope with. Just imagine the stresses involved across the board!!! It is UNSUSTAINABLE!!!
That is why we see people here reading way TOO much into what we are all witnessing in the local economy: all radical transformations everywhere and in every sector. We are quite unique in the world right as far as GDP rates go. Think China or Dubai.
Things are getting way more reasonable from a GDP/development perspective, which IS encouraging.
Please, no more “why should I buy a cardboard box at $400K?” or… “I am starting to panic, I gotta sell!” Show dignity!
It’s comforting to know that these are only 2 persons out of 1,1 million awesome persons living in vibrant Greater edmonton!
Merry xmas!
ray, happy edmonton home owner
Just curious, why is your friend selling a brand new house he hasn’t even taken possession of? Does this 2 story have a garage? What was his price a year ago when he signed with the builder. Do you know?
Cheers,
Piccaso
Wake up and get your head out of the sand bulls ! It’s global and little Edmonchuck which is totally over priced to begin with is not immune.
http://tinyurl.com/3y3wmw
and this little tab is going to be the straw that broke the camels back.
http://tinyurl.com/3y3wmw
I guess my tiny urls don’t differentiate between videos.
The first video was housing in the U.K and the second video was the U.S. national debt at 14 Trillion.
Anyone been to Manhattan and seen that big electronic billboard of the U.S. national debt on ticker tape. It moves so fast you can barely catch it incrementing in millions.
Picasso (or should I say, Brent)
Would you stop posting irrelevant yahoo videos? The first is worthless because it’s talking about UK real estate. The second isn’t even about real estate at all.
Post relevant information about Edmonton, or at least Alberta.
You can’t, because there isn’t anything negative at the moment, is there?
Picasso, is a professional doomster. I couldn’t agree more with anon.
After thousands of posts on the bubble blog and here he says the same thing over and over and over and over again.
lol…you decide. relevant or irrelevant.
Now your deleting my posts Sheldon, to funny!
***response***Yes I am deleting your irrelevant rants and personal attacks. However not all your posts will be deleted. Posts that are not malicious in nature or in responses to your comments will be allowed. However, Your comments have proven you are not interested in constructive debate .
Sheldon. ****
Oh, geeze! Where did the “don’t slam people” policy go?
Anon has repeatedly blogged comments that clearly show a lack of understanding for both economic and market conditions.
Sheldon is a professional salesman. Are they particularly trustworthy?
Here we have a market that shows a statistical decline, yet the cling-ons refuse to acknowledge.
Huge denial. Just wait ’till this spring. Panic.
Sorry Jim,
You have slammed me plenty and the market and I have allowed your comments so you have no crediability there. Its your last sentence that’s interesting.
PICASSO wrote on 21 Decemeber @6:40pm:
“I just kill time on these sites and enjoy being a thorn in the bulls side.
I’m a telecom engineer and the work is plentiful in the U.S.”
Engineer? doubt it. ‘nough said on that.
SHELDON: If what sells month over month are consistently cheaper priced homes due to affordability(i.e. if 75% of homes that sell are under $325K range) wouldn’t that contribute to drive down the average resale price?
If so, is it fair to state that the market and/or prices is “tumbling”.
Thanks in advance!
“After thousands of posts on the bubble blog and here he says the same thing over and over and over and over again.”
Picasso’s(also known as Brent) comments are worthless. Sheldon, I realize you want to give everyone an opportunity to say their piece in a respectful way, but this dude does nothing but hurt the quality of your blog. I wouldn’t have qualms about deleting his rubbish. He’ll cry about it on the other site, ********edited********** Reading that blog is akin to going through a recycle bin…very little substance.
***response, ferret your comments were edited because there is no point in lowering your comments value by stooping to his level with personal attacks. Sheldon***
Sheldon:
I have not slammed you at all. Don’t know how you interpret comments about all the slimy RE agents I’ve dealt with over the years a personal slam.
But you don’t know me. I have plenty of credibility, and ever since the summer of ’06 have liquidated my RE holdings. I have lived through these cycles before, and could see the manic behavior amongst common people who started investing in RE simply because their own equity appreciated….not because they knew what they were doing. One of the key features of business and competition is knowing and understanding the ‘barriers to entry’ in the segment you are investing in. RE specuvestors over the last 2 years have been everyone from mechanics, to plumbers, to secretaries – no barriers existed. What these people failed to see was that they were all competing for a finite RE market, and the barriers to entry basically were non-existent. Virtually anyone could find the cash for a down payment on a place, not understanding or having the foresight to see that when they went to sell, they would be in direct competition with 10,000 others. I know what’s coming.
Jim,
I have a different perspective then you but as I have. Although I disagree with only some of what you say. Also you don’t have to defend your position to me and I expect that people will be respectful of that position and can hopefully learn from your perspective.
Sell now at any price…..Edmonton has nothing to offer anyone……..
http://www.juliobogoricinimoveis.com.br/
Click on ´classificados´……and remember…..R$100,000 = $50,000 CAD…..
Divide all prices by two……
This is where I am posting from right now….Copacabana, Rio de Janeiro….a city with 15 million suckers….errr….purchasers…..a 2 bedroom apartment condo blocks from the beach costs $120K CAD (my one bedroom cost $60K and is 4 blocks away)……or you can pay $400K CAD for the sme thing with -40 celius b- Edmonton.
Your call……
Carioca,
If you had the same job in Rio as you do in Calgary, how much would you earn? More generally, how do wages in Brazil compare to Canada? Health care? Education? Crime?
If you think Edmonton is overvalued, then your opinion is based on the fact your not willing to pay a certain price. Others are, and will. So I will enjoy my cardboard shack in a city that is too cold and ugly for some. I am perfectly happy, and I will enjoy the Christmas weather as do many Canadians. I hope those who want the lower prices find that incredible deal, but why would bother with a cardboard shack in igloo land. Merry Christmas
I realize this is getting off topic but Carioca comparing Edmonton to Rio is ridiculous.
You forgot to mention that Rio has one of the highest crime and murder rates in the entire world.
To quote wikipedia:
“In 2001 the murder rate in Rio was 45 for every 100,000 people and between 1978 and 2000, 49,900 people were killed in Rio.[16] The numbers are comparable with war conflict zones like Baghdad and Kabul.[17][18]”
By the way I have recently relocated to Edmonton. I lived in Vancouver, Toronto and Los Angeles before. I am happy here and the quality of life for me and my family is better than ever. My kids love their school, we have made lots of new friends and live in a great neighborhood. I am not a big fan of winter but there is more to life than warm weather and beaches.
New2Ed you relocated to Edmonton?
Had to be because of work, nobody relocates to Edmonton for the weather, scenery, or cheap prices.
New2Ed, I don’t think murder rate has anything to do with RE prices.
Edmonton has the 3rd highest murder rate in Canada and it’s certainly not the 3rd cheapest. Likewise, Moscow is probably the most RE expensive city in the world; the murder rate is ridiculously high there.
Bunny – you are playing ridiculously with semantics.
New2Ed was trying to prove a point. Compare Brazil’s income, security, quality of life to that of Canada. Warm weather doesn’t equate to better quality of life.
Personally, I love hockey and snowboarding — where would I rather chose to live?
I would love any ” doomer” to provide me with hard evidence that weather has anything to do with RE values! People move all around the world in search of a good job and Alberta still has plenty of them. What piccasso and others fail to realize is that what makes a city great instead of just good is the people who live there. Now I’ll just bet that our “doomer” crowd are are the ones who complain about just about everything instead of contributing to make a place better. I have live in Vancouver, Phoenix and now Edmonton for the last 5 years. This place is cold in winter but it is a great place to live, work and raise a family. Those are things that have to be considered when deciding to buy a home or just move on to find a greener pasture. Edmonton is going through classic growing pains but the long term out look is still very favourable in every aspect. This slow down is the best thing to happen to us since the boom started. If you don’t want to buy then don’t but making ” it’s over statements” have become boring to listen to and I would like to hear some debatable statements for a change. Make us try to think not just run for the hills. P.S. I’ll bet the doomers all perdicted ” end of the world ” at the Y2K scare. Now how did that turn out again????
*****Sorry Car I deleted Rays comments and I am deleting your comments related to his comment.***
BTW I saw on TV how Alberta has the lowest giving record to charity at the Salvation Army collection spots this year and Vancouver and Toronto are the higest. ( double that of Calgary). We should all be ashamed, we all have more money than ever before and this is how we show it? There is no excuse for this and we need to show some generousity or maybe this HAS become the Province to leave. Greed is an ugly thing so pony up Edmonton, this is about helping others!!!
Sara and Sheldon please block following from this blog FOREVER:
1- Picasso
2- Carioca Canuck
These people have no basis for their claims except that Edmonton weather is cold and comparing Rio with Edmonton (Brazil is underdevelop no comparison with Canada, for god sake). They do not live in Edmonton and passing time and making the Blog negative. I really used to enjoy this blog but after these above two I do not like to read comments.
Please save your blog and do not diminish your popularity. Please block them forever.
Car27,
I can probably provide some sort of answer which was right under your nose anyways.
1. Alberta leads the nation in inflation
2. Alberta R/E is the second most (if not the most) expensive in Canada.
In reality it’s costing more to live in Alberta and the salaries that we are making have not adjusted to the economic growth.
Therefore, everyone who carries a large mortgage etc etc has to budget extremely tight so that they can make ends meet.
I also heard on the radio that alot of working class families are now resorting to the foodbank more than ever before.
It’s a complete rat race mentality now in Alberta.
It’s the “greed” that stole Christmas, not the Grinch this time aroung in Alberta.
Merry Christmas all.
SHELDON wrote:
“*****Sorry Car I deleted Rays comments and I am deleting your comments related to his comment.***”
I post legit info. Why delete my comments?
At least it is comforting to see that this blog is going downhill fast and has become irrelevant.
Thank you for the obvious Eric, problem is Edmonton is far from the most expensive RE in Canada. Inflation is rampant in all of Alberta however, donating ones time is not expensive. It shows the mentality of those who live in the city. You are right that greed has taken control of many of our hearts instead of sharing a helping hand. This could be how the RE market got so out of hand in the first place. I wonder if we will learn something from this slow down or just wait for the next feeding frenzey to make a quick buck which only makes us too good to help those that need it. Maybe we all need to redefine success in this new year.
Sara and Sheldon,
Thanks for this blog, for all the information you provide here and for us to have a chance to comment on RE issues.
Merry Christmas
Has anybody on the blog had to recently update their electrical in Edmonton from 60Amp to 100Amp service and know the cost? I found a house that was built in 1958, and my offer to purchase is pending until Friday. The inspector advised me that an upgrade to 100amp service is required (which the Realtor neglected to mention). Does anybody know the true cost of this upgrade in today’s labour market? I’ve been told everything from $500 for a new 100A fuse box to $7000 for permits, fuse box, wiring, feeder lines, etc.
House = merchandise
Electronics = merchandise
(for many, being able to watch TV is more important than owning a house)
There are always people wishing a price reduction for certain merchandises.
People wishing for a price reduction in RE = negative doomsters.
People wishing for a price reduction in electronics = negative doomsters.
Go to the Future Shop today and you will see plenty of negative doomsters. They were negative about the market and held off their purchases for at least one full year already.
Oh man, this is a negative nation, or shall I say, a negative culture.
Housing as merchandise…if you say so. Last time I looked at mazlow’s hierarchy of needs, shelter was their and ipods weren’t.
Its one thing to say negative things about the market. Its one thing to want the prices of a product to come down. In fact those negatives bring positives with them.
A doomster to me is not someone who has a negative look at things. I think prices will come down and thats not a negative in my mind.
Holding off buying something is not a negative. Proceeding with caution in uncertain markets (where there are mixtures of positve and negative indicators) is prudent. In fact the market in previous months has proved that proceeding with caution is good in all markets.
So I agree there are always people wishing for prices to come down. I disagree that people who see negative aspects to the real estate market are doomsayers (or doomsters), that’s a whole different category but I know you are smart enough to know that.
Somemore stats as to why my international comparison is quite relevant……
Canada is the 8th largest economy by GDP (and not by much either)…Brasil is 10th….once the recent undersea oil discovery comes on stream it will be estimated to be 6th.
Canada has 33MM people…Rio has 15MM…..we are like a country down here in this city.
Brasil has oil….and lots of it…in fact one of the largest discoveries ever was just made off the NE coast of the country. But houses here are not going up 100% a year because of it……
And last of all…weather….and it does matter. Give me +40 over -40 any day of the week. How many millions of people are moving to Whitehorse or Yellowknife or Inuvik to work or buy property …..?? Must be because of the nice weather there eh ???
Forgot to mention for NR´s sake….I also live in Calgary…..
****Carioca, if you going call people ignorant everything gets deleted. I don’t have time to baby sit you and edit comments en masse. You could have posted your facts without the slams. …. ***
http://tinyurl.com/36sqty
Looks like things are getting worse…..Citibank, Merril and others in the US will be writing off 50-75% more than last estimated as the credit crunch deepens. The banks can´t stay quiet for long in Canada before they have to slowly release the truth.
I remember the bank runs and closures in the mid eighties here in Alberta….anyone else here remember them ?
BCCC….Principal Trust…..National Trust (where I used to work)…..Financial Trust…..Northwest Bank…..etc…etc….
It is what happens when the bubble pops. People canot get credit for inflated housing prices….houses cannot sell…prices drop…people cannot service debt or refinance….pop.
Carioca, will Citi or Merril having their profits cut in half prevent Joe Rigger from buying a 300k house here in Edmonton?
Scotiabank is still shoving 0 down mortgages down the throats of several thousand every night down at the South Commons Cineplex.
Unless 20,000 oil workers lose their jobs this year, prices will not get halved overnight. If anything, we’ll see a prices keep dropping a couple percent per month until all the first time buyers that have been saving up and holding out jump in again and cause prices to continue their growth.
If the average price drops down to the 300k range, mortgage payments won’t be much higher than rent anymore.
@Carioca
Again, I have to challenge your Brazil / Canada comparisons. Brazil has a much larger population than Canada. So when you look at GDP as a measure of wealth you need to also look at it on a per capita basis. Canada is around 12th in the world, Brazil is 65th. Living there you should know it is a much poorer country (on average) with most the wealth in the hands of a much smaller percentage of people.
EDMONTON JOURNAL Dec. 26, 2007.
QUOTE-
Edmonton-area investment firm Hendrickson Financial Inc. warns that the National Association of Realtors continued to say that “the bottom has been reached” in most of their monthly releases during the year, while in fact home sales figures were revised lower every month.
…………..
An Edmonton realtor said that back in May “listings were gold,” but now “buyers are gold.”
……………
Hendrickson Financial notes that “it is evident that home buyers in Edmonton and Calgary who bought in the spring of 2007, with less than five-per-cent down payments, already have less equity in their homes than the balance owing on their loans.”
Portfolio manager Harland Hendrickson adds: “We firmly believe that we will see real estate prices continuing to move down in Edmonton as well as in all North America over the next year or two at least. This is not the time to be holding onto investment real estate.”
END QUOTE
Does this mean that the info that I got from Realtors was wrong – that it was not a good idea to hold on to my property in Edmonton?
Portfolio manager Harland Hendrickson adds: “We firmly believe that we will see real estate prices continuing to move down in Edmonton as well as in all North America over the next year or two at least. This is not the time to be holding onto investment real estate.”
———
Well researched article. Finally one that is not biased one way or the other. Most other reports discussed herein are from Realtors who are thoroghly biased due to thier part in speculation. Six months ago, I would have said 80% of the realtors had a home – this was a direct conflict of interest. Now they are trying to hold the market up – to make a profit.
EREB, CREB are the last ones you should believe. Even Royal LePage is predicting their lowest 1% increase in Edmononton. This really means -10%.
Trust only the RBC housing affordability reports, these articles that weren’t pushed by realtors and other third party ones.
***RESPONSE***
Carioca. I have tolerated your filth in the name of free speech but when you start calling me expletives and names it just shows that you are not deserving of commenting here. Goto back to the hole you crawled out of and if possible go back to Brazil since you are so fond of it and how wonderful it is. – Sheldon***
New2Ed….
Sheldon deleted everything because reality bites.
You are correct….wealth is in the hands of a smaller group of pele…….just like here.
Nate…..
I never said prices would be halved.
And yes it will prevent “Joe Rigger” from buying a property because now banks want real money down…..and lots of it.
Hello,
I often look at your real estate blog with interest, as I am selling my house – getting married – and looking to expand into something bigger for our family. I appreciate the comments that are pertinent to the Edmonton market, and related trends. However, there seems to be a downturn in the quality of the site of late, and I find myself sifting more and more through irrelevant material, such as the downright silly comments and exchanges on Brazil, etc. etc. I suggest you keep the comments focsed on the Edmonton Market, delete irrelevant or offensive material, and block those who repeatedly seem to undermine the focus of the blog….
***Thanks for your comments. The blog is not our full time job and I do want to allow varied perspectives and unfortunately by the time I get to edit or delete some comments they are up a while. We are trying however to allow respectful opposing comments. Thanks for your comment.***