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The Canada Mortgage and Housing Corporation (CMHC) has recently reported on updated results of their House Price Analysis and Assessment (HPAA) framework. According the CMHC, the analyses attempts to “detect the presence of problematic conditions in Canadian housing markets”. These conditions can range from factors like overbuilding, and overvaluation, to acceleration of home prices, and overheating. The article backgrounder found HERE explains in detail the rubric used in the study.

The CMHC article explains further:

“The HPAA is a comprehensive framework that is designed to assess housing market conditions by taking into consideration the economic, financial and demographic drivers of housing markets. The use of multiple indicators of housing conditions, which incorporate various data sources and prices measures, provides a robust picture of overall housing market conditions.”

The study, which was originally published in November of 2014, reviews the market on both a national level overall, as well as focusing on the major influential centres of Vancouver, Calgary, Edmonton, Toronto, Ottawa, Montreal, Québec and Halifax.

The HPAA considers the incidence, intensity and persistence of these four main risk factors that may provide an early indication of the potential for a sharp decline in house prices.

The CMHC concluded in the original report that there was a “modest” overvaluation on a national scale, with that condition persisting in some census metropolitan areas more than others. Edmonton and Calgary were not present amongst the CMA’s listed for overvaluation, showed no indication of overheating, and presented no risk of acceleration.

Late this spring the framework was revisited, as reported by the EREB, to provide an update on the landscape of the Canadian real estate market. Edmonton again fared surprisingly well in the face of a booming market, risk assessments being categorized as “low” overall. Calgary has apparently been showing indicators of overvaluation, however the CMHC goes on to explain that the Alberta’s economic boom and bust cycles are tending to naturally govern problematic factors:

“MLS^® sales have declined in recent months in [Edmonton and Calgary], pushing the sales-to-new listings ratio to buyers’ market levels, reflecting the impact of lower oil prices on housing demand in these oil-producing centres. This is expected to place downward pressure on house price growth, which could lessen the current risk of overvaluation in Calgary.”

The EREB also indicated that despite market growth in April, with 1597 sales, the city is showing a slight overall decline in residential sales. REALTORS® association of Edmonton President Geneva Tetreault comments on the current market:

“Sales are definitely down this year, but the sales numbers are still higher than 2011. It is unlikely that anyone would call 2011 a bad year for housing sales. It’s just in comparison to last year, we are not quite as busy. Prices are stabilizing and inventory is robust. We will continue to see increases in sales as we move into the selling season”

The CMHC report would indicate that presently, Edmonton one of the few Canadian CMA’s not presenting market risk factors.  CLICK HERE if you are interested in searching for a property or connecting with a Re/Max agent.

Image Credit: Calgary Herald

Just over a month ago the provincial budget was released and now that citizens have finally had the time to sift through the comprehensive report, there is a new awareness of how it will affect personal financial choices. From the perspective of the real estate market, the largest impact will be seen in land title fee increases.

This will affect buyers most directly in terms of closing costs. Additionally, homeowners looking to refinance will also be hit by these additional fees. As explained by DBB LLP land title fees are part of the larger category of disbursement fees, as distinct from the actual legal fees. Disbursement fees are the hard costs incurred by the law firm as result of the real estate transaction. This makes the government fee less than immediately apparent, and a careful review of cost breakdowns may be necessary. Obtaining and transferring land titles is an integral part of a real estate deal, as well as legally necessary, therefore there is no means of avoiding this new government incurred expense.

Though the fee hike is not immediate, it will come into effect on documents registered on or after July 1, 2015, approximately 90 days after the budget announcement which, in real estate terms, will come up quite quickly.

It is important to note these dates are not impacted by possession date, only registration date is a factor.

As of July 15th the variable fee will increase from $1.00 to $6.00 while the flat fee (for land title and mortgage registration documents) will increase to $75.00 from a previous $50.00. These numbers appear to be quite negligible, especially as an additional cost on a property deal worth hundreds of thousands of dollars. However when applying these increases to examples, the additional costs become immediately apparent:

A summary of cost impact courtesy of DBB LLP Law.

For potential buyers, or owners considering refinancing, this fee hike could be seen as a motivator to move quickly on a decision as there is still ample time to close a deal before the deadline arrives. However, due to increased activity in the summer months, as much time as possible is necessary for lawyers and the land title office to complete registrations within the time frame.

CLICK HERE to connect with a Real Estate agent who can answer all your home-buying questions.

 First-time buyers drive the Edmonton housing market. REMAX has more just CLICK HERE for the Re/Max Spring Trends Market Report!

The EREB has just reported some interesting, and potentially unpredicted, statistics based on cumulative March numbers. Sweeping trends for spring appear to be slight drops in total overall residential sales. Yet despite this downturn, the strength of the market has remained unaffected with average sale prices continuing to rise.

Sale prices across the board increased about 3%, with duplexes seeing the highest year over year increase of 6.9%. Single family dwellings rose 1.5% since March of last year, and the smallest growth of all the residential categories were condominiums which saw a 1.2% increase. March’s average single family home sold for $438,880, while duplexes and row housing went for around $354, 022, and condomiumns rounding out at the lower $249, 841.

As mentioned, despite small pricing increases, surplus inventory which has been seen flooding the market since early spring, caused a decrease in overall sales. The same time last year saw 1,554 homes sold, while a decrease of 6.5% overall led to only 1,453 closed transactions. 876 single family dwellings were sold in March of 2015, a 4.5% year over year decrease, while 416 condominiums were sold in contrast to the previous years 474. Duplexes and row houses, though showing the highest price increases, were the only property category to also show an increase in inventory sales, which went up a full 6%.

REALTORS® Association of Edmonton President Geneva Tetreault explains that these spring sales figures are actually a positive byproduct of our fairly stable market over the past few years:

“The fact that our prices did not have the dramatic increases seen over the past few years in other cities like Calgary, Toronto and Vancouver means we have not experienced the same overvaluation. That is why our prices are not taking the same hit even though our inventory is way up and sales are slightly down. A more accurate valuation should keep our average prices more stable.”

CTV Edmonton interviewed Tetreault on the topic of the EREB’s figures in this recent report.

Geneva Tetreault discusses the highs and lows of the spring market with CTV news.

The March market report also touched briefly on rural market statistics for the surrounding Edmonton area. There were 143 residential sales this March compared to last year’s 156, a decrease of 8%. Mirroring the trends showing up in the city, residential listings have seen an increase of nearly 12%.

Tetrault explains that atmosphere of this new market is still strongly oriented towards buyers:

 “The big story continues to be the increase in inventory. We ended 2014 with a fairly low inventory. The influx of new listings means that buyers now have the opportunity to be a little more choosey. Having a REALTOR® help you navigate the market is always a wise decision, particularly in a complex market like ours.”

With 5, 944 properties on the market, 3,152 of those new MLS listings in March alone, it’s easy to see how buyers are experiencing a very different climate than that of 2014.

CLICK HERE to discuss the market potential of your home with a realtor, or to search for one of the many available properties in the Edmonton area.

As March winds to a close and the city has (hopefully) seen the last of winter snows, the EREB has compiled an early spring market report, based on last months figures. The name of the game has been listings, as Edmonton sellers have been more than eager to put their properties up for sale in light of strong market conditions. The positive climate has led to a growth in average residential prices, and a slight decrease in sales, due to the sheer amount of available inventory.

Both month over month averages and year over year amounts showed growth well into February. Average sale prices on single family dwellings rose 0.84% from the winter months to $430,077, which was a 1.17% rise from the same time last year.

Condominiums have seen the most price growth coming into spring, with nearly a 5% increase from February of last year, and up 1.2% in month over month comparisons.

February Average Home Prices – YEG

REALTORS® Association of Edmonton President Geneva Tetreault explains the unique market we are currently experiencing

“We are starting to see sales numbers increase as we enter the spring season. It is common to see sales start to ramp up in February. It’s a positive sign to see that even though listings are up and sales are down from last year that prices remain stable and even slightly up from February 2014.”

February saw 2403 new residential listings hit MLS; that’s 448 more listings than 2014 numbers and nearly 100 more than the month previous. February sales were down approximately 17% from the year previous, however they increased a whopping 40% from January, the month previous.

Overall the outlook is optimistic, with over 384 million dollars in residential sales through the RAE in February alone. Tetrault elaborates on the market:

“Another positive indicator is that our average days on market for all residential types were down to just 48 days compared to 58 days last month. With a healthy inventory, continued low interest rates, and stable pricing, we expect sales to continue to grow through the spring into the summer,” says Tetreault. “REALTORS® are ready to help guide people through all the mixed messaging out there about our real estate market and help their clients make the move that is right for them.”

CLICK HERE to search for available properties in the city and surrounding areas.

It’s that time again in Edmonton

Edmonton in showing all the signs of spring, from warm sunshine, and rising temperatures, to longer days and lawns in sight for the first time in months. This change also means melting snow which can lead from minor to major flooding and water damage issues; not to mention the wear and tear caused by major climate fluctuations. Oh the joys of living with Alberta weather!

Just a little diligence and minor preventative measures can save homeowners a fortune in the long run, so we’ve prepared a short and simple list of 6 ways to prep your home for this coming spring.

1. Strategic snow removal. 

It is important prevent against melting snow pooling around basement windows or draining into the foundation, therefore it needs to be shovelled strategically. Shovel melting snow to a down-sloping area so it will melt away from your home. Additionally, be sure to clear snow away from basement windows.

2. Properly positioned gutters.

Downspouts should extend outward to a position where they discharge meltwater at least two meters from your home to ensure it doesn’t drain towards your foundation. Be sure eaves are clear and functioning properly before the majority of melting starts to occur. A leaking roof is not the best time to discover blockages!

3. Basement monitoring. 

Check your basement for signs of leaking or dampness, especially in areas you don’t frequent regularly. The small amount of time it takes to check can save you much unneeded hassle.  For additional peace of mind, a water alarm can be purchased inexpensively, to alert you to the first signs of flooding

4. Be a helpful neighbor.

The key to spring drainage are the sewage infrastructures already put in place by the city. Though not directly on your property it is important to ensure curb side drains are clear of debris. Being aware of drains near your home and monitoring them will prevent issues with your own home and surely earn the gratitude of your neighbours.

Properly sealed doors and windows are your greatest ally against heating and cooling costs.

5. Door and window damage.

While you’re already out looking for drains and checking your eaves, take a quick stroll around your house noting each door and window you come across. Check that caulking and weatherstripping hasn’t deteriorated, as it so often will, during the harsh winter months. This is inexpensive to repair and will be invaluable when cooling your home in the summer.

6. Prep your HVAC.

It’s been months since you needed A/C so you may want to be sure it’s still functioning properly.

The two best times of year to check your HVAC systems are spring and fall, as these are the season that fall right before periods of the harshest climate change that can wreak havoc on these systems. Pop in a new air filter, and ensure you have an extra one on hand. Then double check your air conditioner is still functioning, as the first day it hits 30 degrees won’t be the best time to call for last minute repairs.

Looking to get into a new home before the summer rush? CLICK HERE to search for available options in your neighbourhood and price range!

With Edmonton‘s real estate market seeing a surplus of inventory, there is a shift taking place towards a buyers market, as discussed in our previous blog post. Buyers can rest assured in their investments, as city planners are working diligently to revitalize key Edmonton areas, which will improve desirability and add value to residential investments in the years to come.

Three important new districts are cropping up in the central region of the city, an exciting prospect for avid shoppers, cultural connoisseurs, and the throngs of tourists the city sees come through every year.

The areas gaining momentum are the Arena District, the Brewery District, and the Warehouse District (also known as the 4^th Street Promenade). These new retail and social centres are exciting and fresh, yet each has unique offerings and atmosphere depending on your preferred speed of life.

Arena District designers have created a central hub for vibrant community gatherings.

Rogers Place and an adjacent public plaza are the focal points of the Arena District, located in the heart of city center. The first stages of the EAD (Edmonton Arena District), including the functioning arena, will be completed by 2016 . This will also include the Winter Garden, a community rink, multiple parkades, and a state-of-the-art office tower. Eventually the district will be home to condominiums, retail spaces, and more office towers as expansion continues outwards to an estimated 25 acres.

Watch a highly realistic mock up of the expected results:

Next on the list of exciting new ventures is the trendy and vibrant Brewery District, aptly named as it is centred on site of the former Molson Brewery, a portion of which remains for historical preservation purposes.

The focus of the area will be on pedestrian oriented development, due to proximity to the downtown core, 104th avenue, and Oliver Square. It will provide high density retail and office space, and offer trendy restaurant choices and shopping attractions in a socially oriented environment.

The design company describes the project in this video:

Lastly, the quaint and classic 4^th Street promenade, aptly anchored at 104th and 104th allows one to step away from the bustle of downtown and slow down the pace of life a little. The newly minted ‘Warehouse District’ as described by developers, is

“A sophisticated neighbourhood in the heart of Edmonton that offers an urban atmosphere in which you can admire the arts, fine food, and unique boutiques. It’s a welcoming environment: once you get here, you’ll want to stay and enjoy quality time in a Downtown oasis.”

Development for all three projects is already underway, and Edmonton citizens can expect completion in the near future. To search for properties available in these areas, or a neighbourhood of your choosing CLICK HERE.

Reports indicate increases in inventory have been the most influential market factor.

The EREB has released their first market report of the new year, outlining how real estate in the city has fared this past January.

The name of the game has been inventory, as the market saw a 30% increase in residential listings, as well as a total inventory growth of 17%, when compared to January of last year.  Within the first month of 2015 there were 2316 residences listed, while in December of 2014 only 932 new listings hit the market.

An additional factor in inventory increases was a slight decline in sales, to be expected this time of year, by a margin of about 13% in month-over-month totals. These considerations have created an excellent climate for buyers overall. REALTORS® Association of Edmonton President Geneva Tetreault clarifies the current market environment,

“We ended 2014 with low inventory. While this is not unusual for the winter, it can make it difficult for buyers to find the right home. The influx of properties we have seen on the market in January will be a relief for buyers – allowing them more choice in their price range and possibly more time to make their selection…Buyers in the popular $400,000 price range often struggled in 2014 to find their ideal property or had to move quickly before it sold. This increase in inventory will be a great benefit to them.”

Despite some sales decreases and current economic factors in Alberta creating pressure, the market has remained as strong as ever, with sale prices still seeing increases. January sale prices increased 1% from the previous month and almost 4% from the same time last year. The residential sale price averaged $362,394, with single family homes at $427,178, and condos remaining stable at $247,116.

President Tetrault elaborates on the local conditions,

“We are likely seeing the effects of oil prices and a feeling of economic cautiousness amongst some buyers. Clients are looking to REALTORS® for advice and guidance to navigate their own individual situations. We expect more of an uptake in the market as spring approaches and more people start to look for homes.”

CLICK HERE to search for a property or contact a real estate professional. 

Housing prices have been resistant to economic decline

In the face of economic downturn there are still expectations that Canadian home prices will continue to rise. It is being reported that while the growth may slow understandably, there is no foreseeable slump in the any of the major real estate markets of Canada.

Despite plummeting oil prices a predicted nationwide appreciation of 2.9 % can be expected on 2015 residential sale prices. The major centers of Toronto and Vancouver are predicted to see increases of as much as 4.5% and 2.8% respectively.

2014 saw prices surpass historical averages; residential detached bungalows rose about 6.7% throughout the nation. Edmonton’s condo market saw the largest nationwide increase at 12.2%, contrasted with the cross-country average of 4.5%.

ATB Financial Chief Economist Todd Hirsch comments on the predictability of the oil markets:

“This happens over and over. In fact, in 2009, we saw a similar price plunge like this and it was quite short-lived and things rebounded…I don’t think we should worry too much because I think it will be quite temporary.”

Alberta in particular has prosperous industry to fall back on, such as agriculture and forestry, which have the potential to thrive in low oil price conditions. Additionally, as reported by the Calgary Herald, Alberta saw a “50 per cent increase in meat product exports last year along with growth in the aerospace, farming and chemicals sectors.”

Pierre Cleroux, Chief Economist with the Business Development Bank of Canada reasons

“Oil of course is the No. 1 export product from Alberta but we often forget that Alberta is also a diversified economy. There’s other sectors that are doing well.”

The real estate market outlook is optimistic due to other economic factors like labour market trends and a continuing surge in demand from homebuyers. At this point the multitude of positive aspects continue to outweigh the decline seen by a deteriorating oil market.

CLICK HERE to search for available Edmonton properties. 

The acclaimations for 2014  continue to roll in and word has been received that RE/MAX LLC has ranked as the #1 Real Estate Franchise according to the latest Franchise Times Top 200 report.

Re/Max Publicist Ronda Scholting explains the highly competitive criteria,

“The exhaustive annual survey is based upon 2013 world-wide sales and growth and includes franchisors from a wide variety of business sectors.”

The report outlines that real estate sales are based on total volume of homes sold.

For the 6th year running Re/max dominates their category, and while worthy of celebration, the honours comes as no surprise to the worldwide real estate powerhouse. The company, ranking twelfth overall, moved up two full slots from the previous year. As a top 20 competitor, Re/Max holds a prestigious spot amongst such franchises as Tim Hortons (#18), Marriott Hotels & Resorts (#11), and McDonald’s, who secured the number one slot on the list.

The astonishing jump from position 14 to 12 in just a year can be attributed to incredible sales growth. The 15.6% increase seen this year is more than triple that of nearly any of the top ten franchise’s reported numbers.

As far as industry competition goes, Re/Max certainly doesn’t need to be watching their back, according to the internal press release, “The closest real estate franchises were ranked #28 and #45.”

Additionally, the company made the top ten cut for sales growth, securing the #2 position in the ‘Fastest Growing Franchise‘ category, second only to Circle K.

Re/Max CEO Margaret Kelly has a straightforward approach to franchising.

Re/Max CEO Margaret Kelly commented on the straightforward nature of the company’s enduring success:

“Our philosophy at RE/MAX has always been very simple. Attract new franchisees by providing support services and competitive advantages that help them succeed. It’s why we continue to grow, innovate and evolve.”

CLICK HERE to read about Re/Max Edmonton agents and homes for sale.