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Thu January 11, 2007 www.edmontonsun.com) P v$ B( n9 x- P1 k
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8 B3 `( o( O. d& E! x( D! }Thu, January 11, 2007: p- L+ w; X7 W
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Price is still rightEdmonton Real Estate Board president expects a 15% climb in 2007
2 v; V0 C! Q5 I3 jBy NEIL WAUGH, EDMONTON SUN
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They're changing the guard down at the Edmonton real estate palace. 5 w: Y5 y4 {" _& ?8 f9 \
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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. 2 ]& c$ Y- q# K! s/ {6 i( W) f
4 T) m. x$ E4 L' MBut first, the EREB president's bold predictions and fearless forecasts. ; c2 P6 P! \1 L, B
" V4 ]+ i. ]* A* XDon'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%. 8 A) q T9 }8 ?
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'CONTINUED DEMAND'
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/ s6 f% c2 y+ L/ T"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." ; B3 B& z5 P" y% A
$ J2 o7 k9 E# M* q3 p5 S# O- JShe 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. ( O& i# j, }( e* M5 S
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"There just won't be enough houses to sell," she sighed. " N# A" |) a: ]) Q, [
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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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"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."
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9 u* b. E" u! J& U1 |) \" a( t4 x1 N' XStill, 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.
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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. 7 }: n2 i, |0 E. l* f" g: f
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"There are too many shortages in the system," he shrugged. ; ^8 o2 I+ _- Q0 l
8 m; H V6 u+ a"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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b# j2 s4 c" E' E; X, T# wHe 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. - }: c% M4 C, L' S7 @
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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. 0 N6 E. h9 g8 W8 r) l( N
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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.
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"Our growing presence in the marketplace is having a strong impact on the competition," Holowach winked.
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% l& @) x t. ]- D! KSo 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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6 v( ]- N; q! cYesterday ComFree was still claiming 30% share of the residential market. And "commissions saved" of $82 million from his sell-it-yourself operation. Which, of course, is what the battle is really all about. 2 K" A' b" B0 ?# g, ^
" }" A# Q! [) x6 F2 i1 m. ]" C" K3 h"We do 95% of the sales in the real estate market," Pratt countered.
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6 w0 \4 p0 q1 r/ A( B' G# @7 KLet the good times roll. 5 v: a' P0 p# Z3 h; R
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Previous story: Bottom Line
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$ M. j9 u0 ]5 t$ B4 @9 O This site is updated by 4:00 a.m. MST each day and includes stories and columns from the day's print edition of The Edmonton Sun.
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