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Thu, January 11, 2007* y- D6 i8 _* w! U+ d
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Price is still rightEdmonton Real Estate Board president expects a 15% climb in 2007
* P) ?4 A8 D! p3 \6 X3 l+ |By NEIL WAUGH, EDMONTON SUN8 D$ J* r( v- R- ?( ^- ^! h
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- n R g% K: r: c& uThey're changing the guard down at the Edmonton real estate palace.
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Madeline 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. ; V/ i. B$ k( x3 f- T, i
: N, o. r a1 lBut first, the EREB president's bold predictions and fearless forecasts. 4 n* e4 d2 O/ Z; {
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Don'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%.
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'CONTINUED DEMAND'
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3 [7 _. R0 C/ m2 U"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."
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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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( i# ?" Z& {4 R4 ^; s ?; B"There just won't be enough houses to sell," she sighed.
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* r$ ] _: Y5 v p& n# v. R5 a4 M4 @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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"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." $ Z8 c) J) X' R5 I" r" a
6 h' `" X! V4 H; @6 QStill, 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. 0 l% ?) t p3 G" l% Q r. S
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"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. ; A- [' K2 `8 T C5 r
0 R ]( O# i$ m D3 z"But it's still going to be very, very strong," he quickly added, with the average new-home selling price ramping up by 20%. # S7 \/ t% }, D/ c0 `$ [
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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."
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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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0 l$ A5 x9 E- R' W; ^ P, rOver 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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5 s3 Z# O3 e+ x$ A3 bHis 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.
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"Our growing presence in the marketplace is having a strong impact on the competition," Holowach winked. / Q! a' C5 e1 v( w; p/ s
6 S: u- T8 t0 _* y. k0 DSo strong that the Alberta Real Estate Association launched a complaint with Alberta Government Services claiming ComFree was bending the truth about its market share.
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* `7 J7 |! v/ \2 I, X# W. kYesterday 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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"We do 95% of the sales in the real estate market," Pratt countered.
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Let the good times roll. 2 L# C C5 u7 {
5 g1 y+ L5 \- H; vPrevious story: Bottom Line
, k7 B: i2 l3 gNext story: Building permits hit record6 t: o9 B% @8 q8 V
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