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* t& d0 F" l& dThu, January 11, 2007- B1 u9 p( T1 m6 t+ b H/ M2 f
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Price is still rightEdmonton Real Estate Board president expects a 15% climb in 2007
4 d, F. x" @. B1 @* _3 WBy NEIL WAUGH, EDMONTON SUN+ a2 z* s) D3 l/ Y
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They're changing the guard down at the Edmonton real estate palace.
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- A+ r ]; \/ q d* U, AMadeline Sarafinchan is out. Carolyn Pratt is taking over the Edmonton Real Estate Board president's gavel - the kind of blunt instrument that some realtors, I suspect, would like to use on ComFree Edmonton upstart Travis Holowach. More on that later. ; j: K" C; X) u
) x5 Y1 w! i0 O8 V( p- D5 |But first, the EREB president's bold predictions and fearless forecasts. ; E' K4 y' n1 u* J- R. V
, G" K6 S- M3 v8 Q9 lDon't expect a repeat of last year's housing boom where condo and single family dwelling prices spiked an incredible 52%. Pratt is now calling for a more modest increase of 15%. 3 S# E) H6 o2 H
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'CONTINUED DEMAND'
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1 B# B4 Q3 h0 S* d5 V"We feel the increase will come because there will be continued demand, consumer confidence, a very robust economy and low interest rates," Pratt whooped at the EREB's New Year's kick-off conference at the Westin. "All the factors are there for another terrific year." / H' ]5 L# O) |7 N3 L/ e: P
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She predicted that the total number of residential sales isn't expected to increase in 2007 - despite thousands of pot-of-gold seekers still flocking to the capital region from across the country as Ontario continues to sputter.
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"There just won't be enough houses to sell," she sighed.
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Canada Mortgage and Housing Corporation senior analyst Richard Goatcher was also talking a good-news-bad-news scenario at the board meeting.
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9 U. u5 p, L; r"The big issue is, are we going to see continued in-migration into the city with the volumes we had last year?" Goatcher said. His expectation is "somewhat less." 9 d c1 r' O2 L+ z4 G: @" v) ~7 x
% w2 f$ N d1 O) w5 o+ LStill, total new-house starts will be "fairly similar" to last year's pace. 2006 turned out to be a record year. So was 2005. But Goatcher is predicting a 5% decrease in house starts. 9 J% `( `7 K9 [9 g, b6 s- ~
2 U/ c5 f4 b4 w- V% i* M"A lot of it is due to capacity issues," he said. Developers are running out of serviced lots in some areas. Some homebuilders "got a little overstretched" during last year's house-building frenzy.
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"There are too many shortages in the system," he shrugged. s+ a( b9 K+ D5 d o2 |
, s/ I: ^8 c. x9 M4 u+ K3 I"But it's still going to be very, very strong," he quickly added, with the average new-home selling price ramping up by 20%.
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NO PRICE BOOM REPEAT
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He also doesn't see a repeat of the 2006 price boom in the resale market, which he described as "unsustainable." / s. q+ N$ o9 A" t6 \. H; A6 s$ E
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Expect a more gentle 10% increase - mainly because many potential buyers are now being priced out of the market - even with zero down payment and 40-year mortgages.
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Over at ComFree Edmonton, president Travis Holowach was also celebrating what he described as a "steaming red hot" real estate market, and another "record-setting" year for his commission-free real estate service.
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His 2006 wind-up report shows 4,375 total sales and 5,721 new listings, up 74% from 2005 - clearly sucking up a lot of the inventory that would otherwise have gone to an EREB realtor. 3 C0 Z; a: X; T% \
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"Our growing presence in the marketplace is having a strong impact on the competition," Holowach winked. 7 y5 A( I$ h- p) q Z. j$ ?
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So strong that the Alberta Real Estate Association launched a complaint with Alberta Government Services claiming ComFree was bending the truth about its market share. 6 u7 e$ H- Z* N9 Z) h4 K7 T
2 ~, A4 m8 U4 u0 BYesterday ComFree was still claiming 30% share of the residential market. And "commissions saved" of $82 million from his sell-it-yourself operation. Which, of course, is what the battle is really all about.
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% Z) A/ Q$ c7 z+ T"We do 95% of the sales in the real estate market," Pratt countered. 1 Q9 m/ z8 I7 K
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Let the good times roll.
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; b' T" e) \: K) @ @Previous story: Bottom Line
7 [, X6 @# i9 K. r6 [9 s% o( R6 KNext story: Building permits hit record2 |5 l7 O' L8 z$ S* y) M# B {* Z
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