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0 x6 h9 Y) r& zThu, January 11, 2007
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# n/ I- f8 y0 P+ k9 S: u* wPrice is still rightEdmonton Real Estate Board president expects a 15% climb in 20079 W( p6 [6 ^" q( D! q" z r
By NEIL WAUGH, EDMONTON SUN
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3 v Q( p0 W6 O2 p- ]% F, gThey're changing the guard down at the Edmonton real estate palace.
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5 N8 d8 Q& f- Z% J6 ?1 FMadeline 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. 9 F& }+ E: |5 B& Q, Y
9 A( }4 A6 D" \; pBut first, the EREB president's bold predictions and fearless forecasts.
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6 E2 e4 G1 q. W9 k$ ]% |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%. ( B" C3 N% c# r0 j1 A! ^' w
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e- B! h& m7 K0 v+ B% e"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. 1 A+ t: n" `- o
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"There just won't be enough houses to sell," she sighed.
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P% C9 T+ l+ |2 J$ Z0 pCanada 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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3 F) I% G; Q3 e( g+ c1 F"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 G- Y7 g! g+ ^4 O! t: H
6 O( K/ ]8 ]& w7 {Still, 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. $ M0 U W3 c1 o8 `7 k1 }! o/ |3 W9 X
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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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" Z4 x+ A! b* w2 ["There are too many shortages in the system," he shrugged. ) ~- F1 d0 S2 }4 a3 g
: C' r% z8 W% |+ }"But it's still going to be very, very strong," he quickly added, with the average new-home selling price ramping up by 20%. - w" ]1 g# l1 \* r1 w0 m
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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." " J% m/ v( A: U
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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. 0 \" \9 c# T" f4 Y: }
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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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% f. m6 @7 [0 e; cHis 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. . [: d4 \; @( _- k
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"Our growing presence in the marketplace is having a strong impact on the competition," Holowach winked.
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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. . t+ R* V9 ?, _. z/ o
$ R5 i% w( l4 k# M/ p5 w) `Yesterday 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. 4 K1 E s3 U2 k
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Let the good times roll.
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* V8 R. m, L0 G4 }- y' oPrevious story: Bottom Line; s+ o0 v! X- w- i) I' \+ b+ @- e
Next story: Building permits hit record9 Y) P1 J% q* x" U
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