The REALTORS® Association of Edmonton released their monthly report on the Edmonton real estate market today and as we were expecting the average residential sale price dropped from $319k in November (and last December) to $308,497 this December. The median price fell after staying at $308,000 for three straight months, to $300,000:
Edmonton Average Residential Price December 2010
“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.
Residential sales in Edmonton were a bit lower than average finishing the month at 784. Street level activity however was higher then I've seen in quite some time, which didn't fully translate to sales but may be an indicator for sales down the road. My assumption based on November and December is that sales should be consistent with 2008 and 2010 for the first quarter of 2011:
Edmonton home sales December 2010
When you break down the sales by type you can see single family home sales in Edmonton held up pretty well for the second half of the year, while condos and sales outside Edmonton were comparatively low. On a side note sales activity is often preceeded by mortgage pre approvals. In a december meeting with Gord McCallum from First Foundation Mortgages he had indicated to us mortgage applications were up for this time of year and so were the quality of the applications. We didn't get into specific numbers but that falls in line with what we are seeing for showings and internet activity on one of our primary search sites - www.EdmontonRealEstate.pro.
Edmonton real estate sales Dec. 2010
We finished out the year with less inventory than 2007 & 2008, but quite a bit more than 2009. The good thing about the present market for buyers is that it has offered plenty of choice and it looks like that should continue in the foreseeable future. Certain areas and price ranges of single family homes especially don't seem to be exhibiting any signs of over supply. :
Edmonton resale homes inventory
Not many home owners decided to bring their homes on the market in December, which is quite typical for this time of year:
Edmonton real estate listings
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“the low point is only evident about three months after it is reached”
Profound.
We seem to be back to Dec 2006 price levels, which I would think would spur some home buying (good for real estate salespeople, Shelly). Imagine the sales activities when prices go back to 2005:)!
Let’s see…..speculators who bought in Dec 2006 have gained zero (0) capital appreciation. Anyone who speculated in 2007, 2008, or 2009 has lost money. Ouch!
Who knew 4 years brought them nothing.
Info from: http://www.ereb.com/pdf/MonthlyStats.pdf
Most speculators that were renting their homes in 2007-08 & couldn’t sell likely sold last year when sales peaked again and prices rose a tad.
Expat,
What are you basing this on? Opinion, some different data…etc.
Totally, not trying to start an argument, just curious.
Cheers,
OB
I personally know a few owners of multiple homes that got in late (i.e. took possession in late 2007 and were desperate to sell but would lose $)
They finally sold last year (summer 2009) and made a bit – not much- money in the end.
This is indeed true to some real estate owners that their houses and billing have gone down maybe because of the recession or the financial crisis that we’ve been through. There is still a lot of things to recover and one of it is the market prices. We really have to do things right this time in order to gain what we have lost. Others just wanted to sell their homes in a price that would eventually regain their investments. Others would sell their homes at the lower price. We never know their reasons but this how it works.
What are you basing this on? Opinion, some different data…etc.
What on Earth happened in 2006 that caused house prices to go up $100,000 or about 50%? That graph is pretty mind-boggling.
A few things “tgree”:
1) We started allowing amortizations of mortgages (how long you can take to pay one off) from 25 years…then ever increasing to 40 years in 2006. This reduces the monthly payment on a mortgage.
Hate to be a real estate sales basher, but many real estate sales people, lenders (banks, mortgage brokers), etc all said “You don’t need to worry about the total cost of a house, just worry about the MONTHLY payments!”
40 year mortgages! 0 (zero) down mortgages!
2) We introduced 5% down and then in 2006 0% down mortgages (Sub-prime anyone?)
3) This caused a huge credit (borrowing) bubble, which created tons of jobs, which caused a ton of people to move here and buy more housing.
4) After this exuberance, people’s (most people) mentality became “I can become a millionaire by being a genius property flipper or landlord”! Did you notice all the Real Estate get rich gimmicks that were on the radio and billboards around Edmonton in 2006 and 2007? Some of them turned out to be pyramid or ponzi schemes (happened in calgary and Edmonton and vancouver…).
5) In 2008/2009 as prices were crashing (over 20% down in Edmonton), the government of Canada continued the Credit/Borrowing frenzy/party by reducing interest rates to 0.25%! Which spurred people to borrow borrow borrow and house prices went up 10-12% for a year and now have gone back down to the lows of 2008/2009.
The thing is, we still have very low interest rates. The Bank of Canada rate is sitting at 1% instead of 0.25%. in 2006/2007 the rate was a lot higher (around 3% I believe, someone correct me).
I, too bought in 2006, but was luckily enough to sell to a greater fool in early 2010. I could’ve made more with different types of investments (like a business).
Now with Canadians with record debts, the government of Canada wants to get people to curb their debt/borrowing…but how do you do that without killing our economy, which is based mostly on consumer spending that was spurred by borrowing (debt)?
Hope that helps:).
So where do you live now? Rent?