Here is our update on the Edmonton real estate market. (Previous week's numbers are in brackets). For the past 7 days:
New listings: 418 (474, 423, 412)
# Sales: 252 (203, 271, 256)
Ratio: 60% (43%, 64%, 62%)
# Price changes: 196 (252, 253, 264)
# Expired Listings: 138 (110, 348, 89)
# Withdrawn/terminated/etc. listings: 16 (36, 40, 20)
Net loss/gain in listings this week: 16 (125, -236, 47)
Active listings for single family homes: 2503 (2486, 2446, 2587)
Active listings for condos: 1991 (1995, 1976, 2057)
As you can see, sales are chugging along at almost the same pace as last year, while new listings are much lower.
For the Edmonton Realtors Association as a whole, there have been 855 sales so far this month – if the pace continues we should have about 1600 sales this month. Average residential sale price sits at $308k (up from last week but down from last month), while single family homes are at $349k and condos are at $233k (both up from last week and the same as last month).
Things seem very stable out there. We've definitely seen an increase in relocations to Edmonton in the past few weeks at our company, which is normal for this time of year. There has been a lot of discussion on the blog about the population figures for Alberta which came out a couple of weeks ago. I've just had a chance to look at them, here are some highlights:
- Over the past year, the top three provinces with the highest interprovincial migration gain in 2008 were Alberta (20,616), British Columbia (6,450), and Saskatchewan (5,559). This is a substantial increase in interprovincial migration from last year in Alberta (9,921).
- Across all provinces, Alberta had the highest growth rate, year over year, at 2.58%. British Columbia and Saskatchewan had the next highest growth rates of 1.70% and 1.50 respectively.
In chart form:
They're still coming! Happy weekend 
Anyone have any data on when the bulk of the new condo completions will hit the market.
I know the 2009 figure came down by about 3k (to 5k?) due to projects put on hold…..but I;d be interested to know when we expect to the inventory peak
With 15,000 job losses in Alberta last month (and more to come), I am a little puzzled as to what these new Albertans will be doing for work. Maybe they haven’t noticed that Alberta and BC are also facing dramatic economic changes. A short-lived stay perhaps?
roadrunner:
it’s not everybody who works in oil or construction…
BTW I hear that a certain builder (that I won’t mention), originally from Calgary who moved up to Edmonton in 2006 are now laying off their better, experienced trades and hire cheaper, less experienced jobbers to cut costs but still retain the profit margin. Can anyone here confirm/deny? A good friend of mine was a top performer for them since day 1 was “rewarded” with a pink slip last week… and the young guy (with a New Brunswick license plate I was told) who replaced him offered the builder (thru third party info) to work for half the cost.
Bob’s site shows Edmonton’s SFH prices higher than March so far…
As of 5 minutes ago, both average sale price and average price per sq.ft. are higher than both February and March by about 1%.
Also, in the last couple weeks, a moving average of daily sales has trumped last years numbers. Sales presently sit roughly the same as last year’s peak in May.
Absorption rate is the lowest it’s been since July 2007.
Interpret as you will.
I forgot one…
Inventory right now is about 35% lower than the same time last year.
Jason:
You seem to be very cheery by all these stats. We still gotta wait until July to see what these monthly stats mean…BUT are people now pulling the trigger after waiting on the sidelines?
Did this campaign of “first time buyers” leading the charge?
BTW… Garth Turner tells his faithful kool-aid drinkers to rent vs buying property BUT he did buy last month! Is this book pimp for real?
It’s not just oil and construction that is suffering layoffs…try looking at financial services, retail, real estate, etc. What’s left, government? They are slow to react, but with lots of budget red ink, they ain’t going to be doing any hiring. And let’s not even get into the wage differential from the oil and construction industry. You quote a prime example of a short stay candidate. Why move all the way from New Brunswick for the same wage, but be faced with double the housing cost? Makes no sense to me. Perhaps that individual will eventually see reality.
To Edmonton Expat;
What kind of garbage is this?
“BTW I hear that a certain builder (that I won’t mention), originally from Calgary who moved up to Edmonton in 2006 are now laying off their better, experienced trades and hire cheaper, less experienced jobbers to cut costs but still retain the profit margin. Can anyone here confirm/deny? A good friend of mine was a top performer for them since day 1 was “rewarded” with a pink slip last week… and the young guy (with a New Brunswick license plate I was told) who replaced him offered the builder (thru third party info) to work for half the cost.”
How on earth can anyone respond to your story from a friend, who knows a guy, who worked at this huge company, I won’t name names, but the products they sell are really crappy and they make the locals lose jobs…so what are you saying, you have it on good authority that this guy you know, has an aunt who’s boss has a chicken that says the sky is still falling, because young punks from New Brunswick are ruining jobs out here? Better not buy, is that what you are saying, cause the economy is never gonna get better, houses are worthless in Alberta, after all there just made out of Nike boxes and shingles?
Go back to the bubble blog where you belong and take your nonsensical, worthless anecdotes with you.
As for Roadrunners comments about why work in Alberta instead of New Brunswick. Since I am currently working for a major construction company in Edmonton that starts with L and rhymes with “Edcor” I actually work with people from out of province. In particular this one guy who comes from Fredericton, which happens to be in the region of the country we are harping on…you know, New Brunswick. He is a recent arrival who can’t believe how good we have it out here. A few of his words below.
1)In Freddy, you worked twelve hours and got paid ten, if you didn’t you didn’t keep your job.
2)In Freddy journeyman carpenters max out at about 14 bucks an hour. And you had to work for it.
3)New Brunswick’s been in a recession forever, and it doesn’t look to have a hope of changing anytime soon.
4)There aren’t really any jobs for young people because there isn’t much work and a lot of the old guys get it.
And my all time favorite since it pokes a hole right through your argument about the cost of living being lower.
5)Me and my buddies were renting a three bedroom apartment in Fredericton that cost $1200 a month, utilities extra, in Fort Saskatchewan we have a whole house with double garage, developed basement, 4 bedrooms and 2 and a half baths for $1525.
Bottom line in his words, “I ain’t never going back.”
There are still lots of projects out here in Alberta, financial stocks are now rebounding, and the stock market always leads an economic recovery. Six weeks of steady gains in the financial indexes, TSX, Dow, Nasdaq. Earnings beating expectations, job losses down, commodities including bell weather copper all up. Oil with a firm fifty dollar floor, new life in IPO’s, etc. etc. etc.
Everything is cyclical, simple economic laws stipulate that when a sector of the economy is hot, usually because demand outstrips supply it behooves people to start businesses that provide supply until eventually too much supply is on the market and bargain hunting can begins. The real estate boom and bust in Alberta is a prime example of this law at work. But just as oil found a new bottom at 35 bucks and now has a floor of 50, and not the bottom of 12.72 and averages in the high teens in the late nineties, don’t expect much more of a pull back in Alberta RE prices. The local economy still shows signs of life since I never noticed a decline in the number of cars on the road, and the mall I work in still has all these help wanted signs up, and the global economy seems to also be ramping up.
ian,
If my comments have frustrated you that much that you think I’m a bubble blogger, well that’s your right.
It indicates to me that your job over at Ledcor may be in jeopardy…no?
Layoff the hostility, dude. Ledcor is heavilly involved in the Bow Tower which is indefinitely halted. Sleepless nights, ian?
I’m surprised that the “code of civility” on this blog fell thru the cracks with your comment.
ian said:
“Oil with a firm fifty dollar floor” How come PETCAN’s laying off folks over at ftMac? How come no investments in oil & gas?
“the stock market always leads an economic recovery”
FALSE!
Markets are about “belief” and “hope”. A levelling out of activity is the first step toward recovery, ian.
One of the best divining rods of future performance is a compilation of key statistics known as the “index of leading economic indicators”, which tracks time-sensitive factors such as building permits, supplier deliveries and manufacturer orders.
Leading indicators for a recovering economy:
1. housing stability in its prices and sales.
2. consumer confidence,
4. employment
5. investments.
Now for Alberta… when Unkie Stelmach cries to Ottawa for money, we’re in deep caca, ian.
ian:
while I appreciate your strong belief in the albertan/edmonton economies, you still have a small snippet of the whole picture…
may I suggest for you to drive up to ftmac.
The alberta economy is still shrinking, job losses mount and watch out for its GDP to go south…
Ian…I was referring to the cost of buying a home not renting, much of which this blog is about. Go compare how much it costs to buy that 4 bedroom home,with 2.5 baths,double garage, developed basement in New Brunswick versus buying the same home in Edmonton. Let me also caution you that the stock market may bounce off its lows, but that in no way assures that the economy will get the same bounce. It will deteriorate further before it gets any better. And better this time around means stabilization and not growth.
On my street, there have been two houses for sale, and both sold in the last couple days. The first was on the market for a couple weeks, and was gone like that. I guess it was priced right. The second had been on the market for almost a year, and the owner finally came to his senses, dropped the asking price by about 10%, and it sold a couple days later. So, in my tunnel-vision, small corner of the world, it looks to me like the market is picking up.
I agree with some of the comments, that it is probably being driven by new buyers. Take your average 400K home from July 2007, which is now down about 20% in price. Assuming you mortgage 100%, your payments would be:
July 2007, say 5.75% interest (borrow $400,000, 25 yr amort) = $2,500/month
Today, say 4.00% interest (borrow $320,000, 25 yr amort) = $1,683/month
So that same house now only costs you 2/3 what it did back in 2007. No wonder the new buyers are starting to crawl back into the market.
Ian, what’s the bubble blog? Is it another Edmonton Realtor blog? If so, what’s the link?
Thanks for the stats again guys. It’s nice to see that some inventory is being moved down the pipeline.
Do the reduced new listing figures finally indicate that all that ‘excess inventory’ )from builders over supply, speculators dumping property and people panicing to get equity gains out of the peak market), is finally getting burned off…??????
Then if so, then with a continued buyer interests we should start to see prices begin to inch up, (at least until the builders begin to oversupply again).
Here’s the exact problem with people’s mentality about real estate today – no one thinks twice about taking on debt of $300,000.00 or even $400,000.00. Why stop there? All they look at is the monthly payment and lose sight of the amount of debt they are taking on to fund their purchase. Read the history books – you’ll find that “debt” can be a killer. Economies are finding that out now – they won’t recover until this mentality changes. Pay attention to what is going on out there. But why you say, it’s different this time. Real estate is a sure thing, right? Or is it?
Three Words: Dead Cat Bounce
Anyone else notice the local builders had their first ever Condo Expo? Does this not strike someone as odd when 20 homebuilders are coming together, renting a massive amount of space and polishing their shoes to try and sell their overpriced, over stocked product?
There is such a glut of condo projects on the market that in 5 years you will pick one up for easily 1/3 less. Just drive down 97th St. north of 167th and look at the 20 homes that have sat empty for over a year. And they have a condo project trailer right next to them.
“In Freddy, you worked twelve hours and got paid ten, if you didn’t you didn’t keep your job.”
I would complain to the labor board.
You won’t hear an argument from me on that one. People should think about the total amount of the debt, but I don’t think many do. What matters to most is only what the banks will give them, and what they can afford on a day-to-day basis. Having said that, with today’s housing prices, if you are not sitting on a huge wad of cash, how do you afford to own a home? Taking out a loan of up to $300,000 or more may be your only option.
Overall though, real estate debt is still much better than many other forms. It’s the people who run up tens of thousands of dollars against their credit cards buying things and who have nothing of value to cover the debt afterwards that I don’t understand. At least with a house you still have the property as an asset to offset the debt, and a roof over your head.
I guess not many people like a good news story here. I for one am not going to say we are out of the woods yet, but there certainly are signs that the worst MAY be over. We shall see.
For those of you who do track the negative blogs, have you noticed that the nice chart that existed on the good old plunge-o-meter website is now gone, replaced only by a excel table? According to that website, Edmonton real estate prices are down about 18%, but I seem to recall it being an even higher fall before, in percentage terms. Could it be that the chart is gone because it would show things are stabilizing, or heaven forbid, maybe even creeping up half a percent in the last little bit? Wouldn’t want a tiny bit of optimism to interrupt our constant stream of negativity – time to yank the chart!
That’s from ian…
The poor guy says anything.
Unless his Freddie buddy worked for cash under the table…
Oddly enough over at the bubble blog, they do not mention the spike in sales for homes but only talk about the economy these days… whatever is negative to feed off.
What do you think drives the RE market – pixie dust and candy canes?
http://albertabubble.blogspot.com/
be prepared NSFW due to some coarse and demeaning language.
Prices have a longs ways to fall yet.
http://spreadsheets.google.com/pub?key=pKhf_Qhx1jfrbTbcuR-dHSw&gid=1
Oh yes, I keep forgetting it’s different in Edmonton. Real estate prices around the world can plummet but not in Edmonton. Funny that 90% of the world has never even heard of Edmonton.
I thought they just sit around and drink while collecting welfare.
You can buy a whole island in Newfoundland for a buck fiffy.
I heard Newfoundland is looking for workers and it’s cheap to live there.
Robert:
you write just like squidly77 does… I thought you were a guest at the Alberta Hospital.
Since when you have keyboard privileges?
I think that’s a pretty good guess. Much lower new home starts last year, and even lower numbers this year, mean there shouldn’t be near as much to choose from this year or next. What is there for spec houses will eventually be ‘burned off’. I think this is some of what we see right now.
Less supply means more competition when buying, and this should stabilize prices and eventually lead to increases.
These comments are barely even worth addressing. Anyone who looks at that chart (as we’ve already discussed here numerous times) clearly has no understanding of exponential inflation or the distinction between ‘real’ and ‘nominal’ prices. Arguing that prices have a long way to fall based on a layman’s glance at a chart like this is absurd. Please educate yourself before you comment next time.
Ian isn’t completely incorrect when he says that the stock market leads recovery. In previous recessions the stock market has begun its recovery 12-18 months before unemployment peaks. If you believe that the stock market is recovering and will sustain its run then you can expect unemployment to peak in early 2010.
Expat the indicators you mention are indicators that the economy has recovered. Ian is looking for indicators that show the economy might be on the path upwards. He should be condemned for that. I for one agree with him.
I have been tracking development permits for housing since December and so far April has posted some solid increases. No surprise given that construction typically increases in the spring. No, the figures don’t match 2006/2007 levels, but there are some solid gains. I also know that a number of builders have been moving spec product at a steady rate. We are on par for 8500 housing starts this year, which is similar to 2008.
WRT to the economy, while I don’t think its ‘a dead cat bounce’ per se, I do believe that we’ll continue to ‘bounce along the bottom’ for the remainder of 2009. The worst I believe, as do a growing concensus of others, is over.
Addendum – I also don’t believe we’ll see major expansion / investment in the O&G until oil stays around $70-90 US and Natural Gas prices increase $7-9 US.
Agree with you CMD. Stock market recoveries from previous recessions have begun approx 12-18 months BEFORE unemployment peaks. The stock market is up about 25% from its low. I don’t think that is a dead cat bounce. Unemployment might peak in early 2010 which might not be great for the housing industry this year but atleast we may be able to see the end of the tunnel.
CMD said:
“The worst I believe, as do a growing concensus of others, is over.”
I’ts very difficult to predict.We need more consumer confidence for sure.
However, according to garth Turner (which has a very obvious agenda to scare folks in order to pimp his books) the worst is still to come.
300k or more in some areas yes … you can still get homes in this city for under 300k. Sure they are far from brand new and sure some of them are in questionable neighborhoods (not all tho).
There is one thing this city can no longer do, and that is ignore the areas around the downtown core. These areas need a big cleanup and some good urban planners to really sit down and think this out. Because another Ellerslie or Summerside is not the answer to a healthy Edmonton future. Nor are more porn, pawn, and liquor stores every 3 blocks. If Edmonton wants to really walk with the best cities in this country, (and not just self proclaim they are) then this is what needs to be done.
So go buy that older house under your budget up in the north east and fix it up. Because in 10 years anything within 15 mins of the core is going to be gold IMHO. It happened in Toronto 20 years ago, and I think I see something about to happen here now.
/end rant
Edmonton, (along with Montreal) got the #1 spot for affordability for major cities in Canada in the recent RBC report.
39.4% for detached bungalow vs 43.7% avg for all of Canada
Standard condo for Alberta as a whole is 25.9%.
What are you talking about? The corner of 97 St and 167 Ave has been developed for at least a decade. The NW corner is the beginning of Baturyn, a 25-year old community. The SW corner is Lorelei, a 20-year old community. The NE corner is Lago Lindo, which is about 15-years old. The SE corner is Namao Centre, about 10 years old.
Do you have have your geography right?