I agree with this comment. People generally follow a herd mentality. Because there was so much optimism built into the market, any pessimistic message from an authority could cause the spark.

The reason for me being on this blog is I just want some all knowing person to tell me what house prices are going to do.

It seems most involved have either agenda’s (realtors) or biases based on wishful thinking. (home owners and people who want to be home owners.)

So it’s hard to trust. If just a couple people start getting scared… that’s all it takes. They lower their prices. Their neighbors who are selling see that and lower their prices. Then, the rest of the people with those empty houses decide it’s time to bail….

Unless, unless, migration continues, which is completely possible, given our very population, only a few moving in can make a drastic difference.

8% lower wages in Saskatoon than Regina seem like a pretty significant difference, especially since their houses are a lot cheaper than anywhere. Maybe I’ll add Regina to Edmonton in places to consider moving to.

According to StatsCan, median family incomes in 2005 were about 8% lower than Regina, but about 5% above the national average.

http://www40.statcan.ca/l01/cst01/famil107a.htm

Not sure what happened in 2006 but I know Saskatchewan showed the highest income growth between Dec. 2006 and Dec. 2007. Correction to my comment above. Average family incomes in Saskatchewan rose 5.4% during that period to 743 a week. Nationally, the rate of income growth was 3.1%.

http://www.statcan.ca/Daily/English/080226/d080226c.htm

I believe the study was done about a year and a half ago. But the average household income was just an estimate.

I know that we have experienced the biggest growth in wages since. I see that trend continueing in the next few years.

To the best of my knowledge there are no real current “household income” numbers. I think the most recent are from 2005. StatsCan did releases some average weekly incomes in January 2008 which pegged that number at 743, which was up about 10% (I believe) from the previous year. Using that figure, the average household income is a little better than $77,000 in Saskatchewan. Doug Elliot from SaskTrends recently commented that we’ve seem good growth through Q1/08 but I don’t recall any specifics being put out there.

Love to hear from some business owners or administrators on the current income trend in your business.

There’s been lots of talk about certain jobs doing well, while others at the lower end of the spectrum aren’t. My son will be on his summer break soon. We’re seeing lots more opportunities, many at 50% higher than what he made last summer.

It will be interesting to see an update on these numbers from StatsCan.

I think that 2500 listings would send us in the other direction. We saw about 4500 resales last year so 2500 listings would be abut a 7 month supply, not a fun environment to sell in.

It leads the world in uranium.

Home of the world’s biggest potash producer, the most valuable company on the Toronto stock exchange.

Diamonds? Yup. We have them too apparently.

Bread. Does the world need bread?

Sure, economically we will do well, but will these things above lead to a massive influx of people, and will this be happening in the next few months?

I believe in the next 5-10 years, house prices here will be very high. But right now, I’m not so sure.

I think if we saw an average listing of 1000 we’ll have a lot more balance. Phoenix and Edmonton are both oversaturated markets. Thanks for those numbers, it gives one a sense of what’s going on. :’)

Here are some approx numbers

Phoenix, 1 listing per 60 people

4 mill people 66000 listings

Edmonton 1 listing per 71 people

1 mill people 14000 listings

Saskatoon 1 listing per 321 people

225,000 people 700 listings

My numbers are not precise but pretty close to get an idea of things.

I believe we need a tonne of listings to get some decency in this market. We have a bit to go yet.

Average Single Family House in Edmonton is around 385k while in Saskatoon it is around 330k

Average Household Income in Edmonton is 85k

Saskatoon is 70k.

So why is Edmonton staying around 385k while Saskatoon is closing the gap?

Supply and demand.

Saskatoon only has around 700 properties for sale. We need something like 2500 listings for some sensibility in this market. We need an oversupply of listings, maybe even more than that number. That may sound like a lot but take a look at this website for Edmonton listings. Tell me that there were no speculators in Edmonton the last couple of years.

http://www.polarissells.com/search_mls_map_form1.php

Going forward, aside from new resource projects which certainly are in the planning stage, we know that the Saskatchewan government’s take from taxes and royalties is steadily climbing. This money will be funneled back into the economy in the form of infrastructure spending, higher salaries for (more) government workers and possibly tax reduction – all things which stimulate a local economy and gets the multiplier effect going as the money gets put back into the economy. We then have a virtuous (feedback) cycle taking the economy and eventually wages – higher. This will be supportive of real estate prices in the medium term, I believe.

I agree that Saskatoon’s house market has led the way for a boom, now we’re just waiting for that boom.

When people hear something wonderful is going to happen to “X” in 5 years, they don’t wait 5 years to invest in it. They invest in it now, before the actual reason to invest. That “good news” of our diamonds, oil, etc is already priced into the market is it not?

Maybe Edmonton has an over supply, but really, in terms of moving to a city, why would new residents move to Saskatoon when they can make more in a similar but bigger city while living in a cheaper house, thanks to the over supply in Edmonton? I think until Saskatoon actually wages actually beat Calgary, or Edmonton, or even Regina (some one else on here), there is no real reason for prices to go up and no real reason for people to move here, other than relatives or friends living here.

I think the Alberta Advantage just got huge, all that held them back from crushing Sask before was that it used to be more expensive to buy a house in Alberta before. All the things like higher wages, more job opportunities (especially for trained professionals like engineers or scientists), a better university and proximity to BC/mountains still exist that initially drew people west – now with comparitively cheaper housing. I wouldn’t move back to Saskatoon to take a pay cut, live in a smaller house and endure even colder temperatures, and some one on here said it leads the country in violent crime, is that true? “Saskaboom” as everyone calls it just doesn’t make sense.

I would have thought about retiring back there, some time in the distant future, but with the assumption I could gain something on the move, just not worth it if I’m losing.

Royal LePage reports on specific property types in specific areas and the “averages” they quote often don’t reflect the entire market accurately, in my opinion. I know that there are also some weaknesses using the overall average selling price of all homes but I think it probably paints a closer to accurate picture.

Thanks for the comment. So, who do you see as the primary active buyer then as we move forward from here. Consumers, speculators?

Oh my, he does sound as bad as Atch! LoL

A lot of Albertans too thought, regarding Ralph Klein, that a monkey dressed in a suit could have led them into that boom, it didn’t matter who was at the helm. I’m going to say the same for SK. :’) Of course, if not managed properly the grass can turn brown PDQ.

Ron,

Numbers of slower sales and rising inventory point towards a buyer’s market. While I’m one of the bears, I don’t see how Saskatoon prices are going to rise (substantially) if wages aren’t increasing at a decent rate. Only the big wigs initially will be making a pretty penny off this “Saskaboom”, not the average Joe. As observed, real estate has taken off before any real SK economy boom is present. Saskatoon could “truly” boom and I still don’t think we’ll see much more for price increases this year since the market seems to be maxed out for many entry level buyers.

And Norm, I was pretty sure Royal LePage’s own survey pegged Regina at $100,000 less than Saskatoon. And the higher wages in Regina than Saskatoon are a couple years old, but I’m assuming still accurate.

Thanks. My position with Royal LePage includes “media spokesperson” responsibilites so I have had a number of opportunities to speak with Star Phoenix reporters. To their credit, they have published my comments on affordability in the last four or five stories that they’ve spoken to me for. I think they get it. In fact, the story that Joanne wrote came from her own feeling that things have gotten a bit wacky.

I am also befuddled about the differences between Saskatoon and Regina though the difference is probably far closer to $50K than $100K.

Ron,

Hope your wrong but I’ve been amazed more than once by this wacky market.