Saskatoon real estate: Week in review (March 16-20 2009)
Signs of spring life finally brought a little hope as Saskatoon real estate agents reported fifty-eight firm sales to the local MLS system, up nearly twenty percent over the previous week but still shy of the eighty-six unit sales of houses and condominiums produced during the same week last year. Still, it was nice to see that fifty-unit barrier broken. With any luck we’ll be seeing a lot more of this range through the spring months.
New listings of Saskatoon houses and condos came on equally strong this week as 133 properties were brought to the market, not including the twenty-four homes which were canceled and re-listed. Ninety-two single-family homes and forty-one condos were offered for sale over the course of the week. Total active residential listings continued on an upward path growing by fifty units to finish the week at 1,394 properties including 857 houses and 453 condominiums.
Click the image for a larger version of the graph.
Some of you have been watching the price graph wondering if we’d see an eventual intersection of lines, and if so, when. This was the week that it happened as prices showed year-over-year declines using all three value measures. The least significant is the weekly average, which often spikes around. It slid $20,000 below last week’s number to finish at $260,953. The six-week average moved nearly $7,000 from the week before to finish at $268,144 down about $4,500 from the same week last year. The four-week median saw similar changes sliding $6,500 from the previous week to $253,500, down from $260,750 for this week in 2008. All of the gains for 2008 are now but a memory, a sad reality for some and a hopeful sign for others who may have wondered if the ship had sailed without them.
Some have suggested that a rally is nearly imminent and that prices will be pushed to record highs in the months ahead. I have to say that it would be one heck of an impressive thing to see, and almost certainly the biggest adrenaline rush of my lifetime to participate in.
Can this market turn on dime? I suppose it’s possible, but frankly, it seems fairly improbable. It seems far more likely we will be facing our little period of year-over-year downs that has found most real estate markets around the world. We have some near impossible numbers to beat to avoid it. Last March, the average selling price of a property in the residential category was $289,440. This year, were sitting at $255,455, month to date. If the magical real estate fairies brought us another hundred unit sales at the highest weekly average we’ve ever seen ($332,000) we’d still finish March below last year’s number. Take comfort in knowing that we are rapidly moving back towards healthier market conditions, a market in which an average Saskatoon family can afford to buy an average Saskatoon home, and one in which an average Saskatoon homeowner can find a buyer for their home in sixty days or less. This is the spot we should be hoping to find again. It’s a pretty happy place in the real estate world.
Click the image for a larger version of the graph.
This week’s average underbid grew in dollar amount and percentage of list price to $11,363 and 4.2% respectively. The percentage of sellers who bagged an offer within $5K of their asking price remained steady at thirty-five, while the $5,001-$10,000 category slid slightly from thirty-five percent last week to twenty-nine. The following two categories ballooned, nearly doubling over the previous week, while the two categories representing the largest discounts saw just five percent of sales, nearly one-third of the number seen the previous week.
See a Google map displaying the boundaries of Saskatoon real estate “areas” here
Data collection and calculation for our statistical reports
I’m always happy to answer your Saskatoon real estate questions. All of my contact info is here. Please feel free to call or email.
Norm Fisher
Royal LePage Saskatoon Real Estate
There's 121 Comments So Far
April 13th, 2009 at 10:13 am
Ahh, the magical real estate fairies. You’ve just got to love them.
Thanks for another great post, Norm. The effort shows.
April 13th, 2009 at 10:13 am
Great update Norm. Good column on GreaterFool.ca yesterday. It’s well worth reading – if only to serve as a cautionary tale to others regarding low interest rates. As Norm’s graphs now clearly illustrate (and to quote Norm): “All of the gains for 2008 are now but a memory, a sad reality for some and a hopeful sign for others who may have wondered if the ship had sailed without them.”)
http://www.greaterfool.ca/2009/03/20/canadian-roulette/
Canada’s facing a mortgage tsunami.
“In a few short years, just as the housing market starts to recover from the Great Recession, it could be felled all over again. It will be a unique made-in-Canada real estate disaster with the potential to be every bit as nasty as the subprime teaser loans that felled America.
Edited: Thanks Jason but it might be considered uncool of me to have Garth’s article printed here “in its entirety,” but you’re right that it’s worth a read.
April 13th, 2009 at 10:13 am
Has anyone heard of Canadian banks colluding to raise interest rates by 1% on personal lines of credit and other variable rate loans? (apparently this was to go into effect March 1) I received an interesting story and link on this the other day.
http://www.saynotobanks.com/
http://saynotobanks.wordpress.com/2009/02/18/3/
This will be my last post for a while, so keep up the great work Norm and I’ll try to check in from time to time. Enjoy the weather and good luck to all buyers/sellers!
captcha: cio twister
April 13th, 2009 at 10:14 am
Jason,
Wonder if that includes Royal Credit Line because sits at 2.5% which is insane
April 13th, 2009 at 10:15 am
Jason,
My line of credit was at 8.5% in February of 2008, fell to 6.75% by November and is at 5.25% today.
No internet where you’re going?
Take care.
April 13th, 2009 at 10:15 am
Hmmm…I have to get a LOC with Norm’s bank, obviously.
Mine’s still at 7.5 and it shouldn’t be, given my rating.
And I’m surprised to see that prices are down YOY this early — I expected this later in the year, into the summer — but it’s nice to see sanity returning.
The magical RE fairies are obviously not doing their jobs.
April 13th, 2009 at 10:16 am
Norm, no problem re: the edit. Not for a few weeks and then I’ll be getting settled unpacking for a few weeks – fun stuff like that. Keep writing and I’ll keep reading! (and thanks!)
Armoth, my HELOC ($0 balance, ends this month) was still sitting at 2.5%. Will be interesting to see what rate I can get on a LOC next month (and whether or not this will include my firstborn or not).
April 13th, 2009 at 10:16 am
Wow! Every major price indicator down year over year.
That has to be worthy of a news story.
I’d think front page in Monday’s Star Phoenix, but it will probably be Obama’s insensitive “special Olympics” comment or something else that doesn’t affect any of us day to day.
I’d submit a letter to the editor, but alas, I used my monthly quota up earlier.
Crikey? Norm?
Norm, you should supplement your income with a weekly Star Phoenix column, your weekly post alone is already beyond what would be required. Sure it would be quite a popular feature for them to.
I really am moving on to Regina stuff, but this is a big deal.
Point about the line of credit, we’ve known for over a year there was some degree of economic uncertainty, hopefully Canadians used that knowledge to curb spending and pay off debts.
April 13th, 2009 at 10:16 am
Well, I need to add — my LOC is at 7.5%, but it’s also empty
April 13th, 2009 at 10:17 am
Nick,
You’re probably the only I guy I know of who has ever used up his “quota” of letters to the newspaper. This will surely make the news but not until SRAR releases the monthly stats the week after next. It will be interesting to see if it gets explained away as a result of the ranges of homes that sold.
“you should supplement your income with a weekly Star Phoenix column”
They could actually use some kind of a RE feature. Maybe I could talk you in to suggesting that when you’re allowed to write a letter again?
April 13th, 2009 at 10:17 am
There’s an interesting post about fixed vs. variable rate mortgages on Mr. Turner’s blog:
http://tinyurl.com/dkjcdp
Not quite as interesting as our previous discussion, though. This blog is *way* ahead of the curve!
By the way, Stoon, have you agreed to either wager or are you just “sticking” with your prediction? No pressure or anything.
April 13th, 2009 at 10:18 am
Crikey,
Thanks for the link. Something to contemplate. I soon have to choose what mortgage I want to go with. I’ve debated 5 year fixed vs 7 vs 10… but never considered variable rate. Mr. Turner thinks it’s the way to go.
While I see his point there’s a couple grey areas. I wonder how “involved” one would have to be with the financial news to adequately watch for increases in interest rates. How quickly can they go up? Maybe looking back in history would give me some possible scenarios. I just wouldn’t want to be twiddling my thumbs and suddenly caught off-guard with a 3% hike before I can pick up the phone and lock-in my mortgage. I’m just NOT into the risk – but Mr. Turner says it’s not risky at all! This is hard to believe.
April 13th, 2009 at 10:18 am
Crikey,
Thanks for the heads up on that post. Here’s something from Canadian Mortgage Trends titled, ‘Things Have Changed.”
That’s Desjardins’ conclusion regarding the long-held superiority of variable rates over fixed rates. Desjardins declared last week that it “must drop the time-tested assertion that a variable-rate mortgage is always the best choice.” Based on Desjardins’ assumptions, it says “fixed-rate mortgages currently appear to be the least costly.”
http://tinyurl.com/d5g6uw
April 13th, 2009 at 10:18 am
Thanks for linking that article in Mortgage Trends, Norm- I recall reading it a little while ago. It’s true that with variable rates over prime now, the variable advantage is probably less than previously.
I came across this recently, Heather, and I found it pretty informative. I hope it helps you some:
http://tinyurl.com/c6o8rp
If you can convert to a fixed rate without penalty, this could be the way to go. Having the security of a fixed payment may be worth the premium, of course. Best of luck!
April 13th, 2009 at 10:19 am
Heather D,
Please dont take any advice from Garth Turner everytime he seems to make a prediction or “show people the right way” he ends up making them lose their life saving or retirement dreams. If you dont believe me check out his previous books and predictions he probably hurt as many people as Jim Cramer did saying buy some good old Lehman Bro’s….up to you tho =o) I always preferred knowing what my costs are gonna be so i can budget good but i guess some people just like to roll the dice as they say.
April 13th, 2009 at 10:19 am
And it begins!
April 13th, 2009 at 10:19 am
In my defense, the monthly quota is one letter.
I’m sure the typical SRAR or Atch or Wall spin will point to signs the market is picking up – like the small increase in sales, and ignore median and mean price down year over year and the increase in total inventory, from listings >> sales, again.
Norm I really think you should consider approaching the SP with a column proposal. Actual frank discussion would be appreciated and popular. Another booster realtor, or journalist, would just increase existing sentiment, without adding any actual numbers.
April 13th, 2009 at 10:19 am
Hi Norm
Really enjoy your blog. It has served to keep me semi-sane in what I have found to be a rather insane real estate market.
Other than the fact that 40yr mortgages and speculators have driven the cost of a home far beyond where it should it should be for Saskatoon I have another issue. I would like comment on the situation of real estate agents speculating in the mrkt. I have been looking for a house to buy for about 19 months now and I find it crazy that I am bidding against RE agents (as I found myself doing late in 07), and on a few occaisions I didn’t even get a chance to put in a bid. Now many of those homes are back on the market at about 100K more than they had been. So while I have an issue with bidding against agents more fundementally I find it to be a conflict of interest to have agents who own two or three (or more) investment properties and who are also advising
clients on what price to sell/pay for a house. Given that it may not in their own best interests to tell a client to lower their price we end up with the scenario of homes on the mrkt for months and months with sales dropping like a rock. I realize there are other factors at play but I really think there should be gov’t oversight in the real estate world to try to protect people who aren’t looking to speculate but just pay a fair mrkt value for a home.
April 13th, 2009 at 10:20 am
Nick,
No doubt that lots of effort will go into painting a blurry picture, but you know, people just aren’t that stupid. I come across the odd person who seems to be living in the dark but for the most part people seem to be pretty much in tune with the market. Almost everyone seems to be aware that inventory is high and that prices have come down a fair bit. They’re certainly in touch with the tough economy that is being faced everywhere to some extent. That said, I think that almost all of the danger associated with spinning tales comes back to the spinner. You see the blogs on the news sites and how people are lashing out when they smell a rat.
G,
Thanks for your comment.
While I am a proponent of “free markets” I don’t have a great deal of use for real estate “speculators” whether they’re agents or some other variety. I’m talking strictly about those who buy, hold and flip. Buying in an appreciating market with the sole intention of resale can obviously deliver great returns if the timing is right but that profit seems to come at a great cost to the community as a whole. I think that there’s all kinds of evidence of that around Saskatoon.
In case anyone is confused, it doesn’t bother me if investors are finding an opportunity to add some value. Those who fix up old or abused homes, or provide good fair rental opportunities for those who can’t, or don’t want to buy, bring something of value to the community. Anyone who makes something out of nothing, or makes something ugly beautiful again should be commended.
G, I think the idea that an agent would overprice listings because they own investment property and are attempting to keep values high is likely a bit of a stretch. “Homes on the market for months” benefit nobody and can really cost an agent a lot of dough. I do agree though that an agent must take great care in avoiding a conflict if they’re buying or selling. An agent should never buy a property that might be of interest to someone who has hired them to help them find a property. I would say that in most cases it’s just a bad idea for an agent to buy directly from a client, or sell a personal property to a client. Those scenarios could be part of the definition of “conflict.” I would hate to think though that when it’s time for me to sell the home I’m in and move on to my next that I wouldn’t enjoy the same opportunities that anyone else has in the market.
Thank again for the comment. It’s a very interesting topic.
April 13th, 2009 at 10:20 am
Just wanted to mention that I bought my house almost a year and a half ago but I still pop back on here almost every week to keep up with what’s happening with the Saskatoon real estate market.
Fantastic job, Norm. (wish I could give you a Ebert “thumbs up.”)
April 13th, 2009 at 10:20 am
catsmeow,
Thanks for the feedback. Appreciate you continuing to visit.
April 13th, 2009 at 10:21 am
Jason,
In regards to the line of credits being raised. I saw the same article and spoke with my bank about it. They assured me that it did not apply to my secured line of credit which is backed by my house. Of course if I sold the house or tried to make any kind of change to the LOC they could change the rates but otherwise they are locked in. It would be like the bank changing the rate on your mortgage.
Heather D,
I am not in the banking industry but I don’t see rates miraculously going up 3% with no prior notice. The fact of the matter is we are in the worst recession in 80 years (which could turn out to be the worst recession ever) and the world is flooded with debt. As this debt goes bad there is deflation which will keep rates down. This will obviously change at some point but it won’t be at the drop of a hat. I’m sure you will see plenty of articles posted here as inflation starts to return. Honestly, it could take years before inflation gets started again.
April 13th, 2009 at 10:21 am
Look for big gains in the DOW today
April 13th, 2009 at 10:21 am
“Look for big gains in the DOW today” – Stoon
Looks like you are onto something Stoon. Oil is approaching $53 as well……
The stock exchange could be another factor for house prices as well if RRSP’s are used for down payments.
April 13th, 2009 at 10:22 am
Vancouver Sun – There is no secret subprime mortgage problem in Canada.
A foreclosure on a family home is a heartwrenching human tragedy. As the recession takes its toll on household income, the number of foreclosures is increasing.
Fortunately, they remain relatively rare, and pose no systemic threat to Canada’s financial system, in stark contrast to the subprime mortgage meltdown that ravaged the U.S. economy.
Despite what you may have read elsewhere, Canada does not have a subprime mortgage crisis. An article in a Toronto newspaper this week carried the alarming headline, Canada’s dirty subprime secret, but it offered little evidence that loans to unqualified borrowers were a secret or dirty — or for that matter, subprime.
http://www.vancouversun.com/business/fp/1408613/story.html
April 13th, 2009 at 10:22 am
Norm
I think the Vancouver Sun is wearing great big rose coloured glasses. While I don’t expect to see a US sub-prime meltdown in Canada I do see a lot of problems caused by the use of “nothing down and 40yr mortgages” http://www.bankruptcycanada.com/bankstats1.htm
I was amazed to see the popularity of the 40yr mortgage and the eagerness of many people to compound their bad decisions with using their equity to purchase depreciating assests. What I have heard from “banking friends” is that approx. 80% of mortagages taken out in Saskatoon in the last 2 years were for 40yr. That is shocking.
With the across Canada drop in real estate values we will continue to see bankruptcies, the resulting increase of homes for sale, and the continuing drop in house prices…. Not as bad as the US but we have a way to go yet
April 13th, 2009 at 10:22 am
G,
I don’t disagree that we’ll see some problems resulting from 0-40 mortgages. I posted on the Globe’s story the other day and thought I should follow up with this one for that reason.
April 13th, 2009 at 10:22 am
Surprise jump in U.S. homes sales.
Sales of existing homes rose from January to February in an unexpected boost for the slumping U.S housing market as buyers took advantage of deep discounts on foreclosures…The median sales price plunged to $165,400 (U.S.), down 15.5 per cent from $195,800 a year earlier. That was the second-largest drop on record.
http://tinyurl.com/cht426
April 13th, 2009 at 10:23 am
Norm,
Surprise? Apparently “distressed” sales accounted for 40 to 45 percent of transactions in February. Inventory in the US is still incredibly high, but has been down YOY for six or seven months. Interesting. Inventory might peak this year.
Stoon,
Ahh, Tim Geithner has some great kool-aid, huh? What’s a trillion or two between friends.
April 13th, 2009 at 10:23 am
Maybe my name should be captain obvious, but inventory is going up again, getting emails at work from coworkers who wanted to sell 6?! properties. Other emails from those looking to rent houses for a couple years instead of selling right now.
Inventory keeps growing. That has to mean prices should keep falling. Not sure how else you’re going to sell when buyers know there are 10 more just like you and some one out there has to be motivated.
Stats Can, Macleans, Frontier Center, the Vancouver Sun, every one else can see Saskatoon is over priced. Every where else has better discounts on housing. Just haven’t figured it out here yet.
This graph says it all
http://www.normfisher.ca/images/teamblog/troysgraph.jpg
April 13th, 2009 at 10:24 am
“The sky is falling!” ~ realist
April 13th, 2009 at 10:24 am
L.oki-
Straw man
From Wikipedia, the free encyclopedia
A straw man argument is an informal fallacy based on misrepresentation of an opponent’s position.[1] To “attack a straw man” is to create the illusion of having refuted a proposition by substituting a superficially similar proposition (the “straw man”), and refuting it, without ever having actually refuted the original position.[1] [2]
Not to be rude, but weren’t you just chiding people about “attacking” others with dissimilar viewpoints? What gives?
April 13th, 2009 at 10:24 am
okay oki, explain how inventory growing and growing with stuff not even listed and people spamming their workplaces to sell revenue properties equates to a strong market
or even stable prices
April 13th, 2009 at 10:24 am
good call crikey, smarter reply than i mustered
April 13th, 2009 at 10:27 am
Unrealistic
Buying a house in Saskatoon when prices are so high.
Buying a house when so many are available.
Buying a house when Frontier Center shows Saskatoon is more expensive than the majority of comparable Canadian cities.
April 13th, 2009 at 10:27 am
Haha Crikey, its true. I apologize…I was just giving people grief for that,
I just couldn’t resist!
April 13th, 2009 at 10:27 am
I’ve said all along I don’t think the sky is falling, Norm hold your laughter, I actually think Saskatoon has some very strong fundamentals. Not sure if realist is much more pessimistic than I.
I think the big thing is that had our economy had another year like the first half of 2008, we would still have had too much housing (maybe more so with less cautious builders) for the demand. I think prices tripling in the time I lived in Saskatoon, since having given back some of that, was ridiculous. I think it is is ridiculous when for income levels, Edmonton becomes significantly cheaper to buy a house in.
Seems when ever you point out that inventory is bloated you’re a “Sask A Whiner” or paranoid.
To me right now.
Inventory is up, over double past 7 years and growing
http://www.normfisher.ca/images/teamblog/troysgraph.jpg
Sales are down from last year (with more listings)
http://www.normfisher.ca/images/teamblog/stats032109_sales.jpg
The global economy is still in trouble, and other similar locations like Edmonton are now cheaper to live and places like Winnipeg that were previously at a similar price level are now far cheaper.
Doesn’t mean Saskatoon isn’t a good place to live.
It’s very average by Western Canadian standards, save for a higher crime rate. Which is why I think $240,000 at the end of 2009 is reasonable. Still well down from present. But when I moved there, the average price was around $150,000 – when I left it was over $300,000. If you told a home owner 5 years ago, their house would go up in value $90,000 (well over 50% in 5 years) I think they’d be very happy with that. Doubling, in just over 2 of those 5 years never made sense. Even less so now that we’re comparatively more expensive than most and there’s just so much for sale, everyone expects it to drop, and buying now, to me, doesn’t make sense.
I think long term I’d buy in Regina, or Saskatoon, if prices came back down a bit, or wages went up to meet the Alberta level.
References:
1 – Norm’s site
Always amazed other sites get by on just posting some realtors opinion, the popularity of your site proves that a reasonable number of people want some actual data to consider.
April 13th, 2009 at 10:28 am
Nick, my only suggestion when composing an argument is to compare apples to apples.
If in one sentence you say:
“Inventory is up, over double past 7 years and growing”
In the next sentence, you should also reference the past 7 years, not just last year. Keep it apples to apples.
Other than that, I hear ya.
–
Norm how are our sales compared to the past 7 years? do you have a chart for that? month over month?
April 13th, 2009 at 10:28 am
“Norm how are our sales compared to the past 7 years? do you have a chart for that? month over month?”-Loki
That is a good question I would be interested to see that as well. Or is there an average price listed for the last 7 or so years?
April 13th, 2009 at 10:29 am
oki, good to know you’re the built in proof reader
Sales seem just under normal levels, Norm had commented on this previously, so sales aren’t down as much as I had expected. Still down from last year. And looking at that inventory graph, sales obviously aren’t keeping up with new listings.
http://www.normfisher.ca/images/teamblog/troysgraph.jpg
As long as total listings keep growing, plus the anecdotal increase in vacant/empty revenue properties being witheld waiting for a stronger market, prices need to go down to increase the number of buyers. Maybe get a few renter to buy. Lower number of cohabitants. At present, seems like there are more houses and condos than needed in Saskatoon.
April 13th, 2009 at 10:29 am
And I wasn’t comparing, I was adding up signs of a weaker market:
Inventory over double the past 7 years for this time
Sales down from last year
That alone would suggest to me prices should be down significantly, not more expensive(right up until this past week)
April 13th, 2009 at 10:29 am
Nick, anytime man, don’t mention it.
Norm, I’d still like to see a graph if you have one.
April 13th, 2009 at 10:30 am
Here is the February comparison over a half decade:
February 2004 – $130,168
Inventory – 528
February 2009 – $280, 307
Inventory – 1313
Interesting……
http://www.teamfisher.com/MLS__Stats/page_1723681.html
April 13th, 2009 at 10:31 am
L.oki,
6:35 PM – “Norm how are our sales compared to the past 7 years? do you have a chart for that? month over month?
7:05 PM – “Norm, I’d still like to see a graph if you have one.”
Lol. You’re kidding right? I mean, what am I, graphs r us? You must think I just pull graphs outta my…ear.
No seriously, sorry I took sooooo long. I was actually showing a property to two different buyers.
I don’t have a graph for the past 7 years, but coincidentally I have been working on a set to include with the monthly report from SRAR. They go back to and include 2005, but they got seriously ugly and hard to read if I tried to include previous years. I managed to slip 2004 on the inventory graph. I’ll probably remove that eventually but it really screws with my legends if I just delete the one year.
Inventory – http://www.normfisher.ca/images/teamblog/actives0209.jpg
Unit sales – http://www.normfisher.ca/images/teamblog/salesbymonth0209.jpg
Average sale prices – http://www.normfisher.ca/images/teamblog/averageprice0209.jpg
April 13th, 2009 at 10:31 am
Faster faster Norm! The digital age has made us impatient. lol
Seems like all the realtors I run into have buyers who are waiting to jump
April 13th, 2009 at 10:31 am
Looks like the unit sales are above average Jan, and average Feb, based on that graph. Good to see. Can’t wait to see what happens in next few months
April 13th, 2009 at 10:32 am
This is what “year-to-date” sales have looked like at the end of February for the past six years.
09 – 423
08 – 667
07 – 540
06 – 395
05 – 349
04 – 366
Now, if I popped those numbers on a graph, I think you’d all agree that 08 and 07 are the oddball years, just as they are for prices. Demand is reasonably good, all things considered. Still, no question that inventory is off the chart. Last year we managed to top 1,800. Listings started building later and there were more units being purchased. I think this is why some are concerned about how high it could go this year. March will produce another jump on the actives graph and sales appear to be coming in on the weaker side. Year-to-date sales will likely fall to the lower side of what’s “normal.”
09 to date – 188
08 – 391
07 – 433
06 – 304
05 – 349
04 – 366
Unless something really crazy happens over the next 8 days, weaker than average unit sales for March, and some strong contraction in prices are likely to wake sellers up a bit (this is your spring market folks). I think it’s a toss up as to how buyers might react. Between prices and interest rates the “monthly cost” of owning an average home has come down by hundreds of bucks in the last six months to a year. You can now finance a $250,000 house for $1315 a month, and you can do that over 25 years. I don’t think you can rent that house for that amount. That same house would have been near $2,000 a month at the peak (when it was selling for $300K).
April 13th, 2009 at 10:32 am
L.oki,
“Faster faster Norm! The digital age has made us impatient. lol”
How true. I have been a Blackberry user for years so I can respond to emails in minutes when I’m away from my computer but it doesn’t do graphs.
“Seems like all the realtors I run into have buyers who are waiting to jump”
I think this is very true L.oki. They are “waiting to jump.” It’s an indication that there is a high degree of interest in Saskatoon real estate but buyers do feel uncertain about the future.
April 13th, 2009 at 10:32 am
Norm, in your previous career were you an accountant?
April 13th, 2009 at 10:33 am
L.oki,
“Norm, in your previous career were you an accountant?”
No, I was a radio advertising sales guy for Rawlco at C95FM. It wasn’t until later that I became a bit of a geek.
April 13th, 2009 at 10:33 am
2007 and 2008 may have been odd years, but 2007, with very limited supply and big demand had much lower prices than now…
Hey Norm, when’s that graph coming
… so if you became a geek later you couldn’t have done my math homework?
April 13th, 2009 at 10:33 am
Hey- geekdom is highly underrated.
“You can now finance a $250,000 house for $1315 a month, and you can do that over 25 years. I don’t think you can rent that house for that amount. That same house would have been near $2,000 a month at the peak (when it was selling for $300K)”
I think you can. I’d be interested to know how much the house I’m in would go for, but we’re renting a 3-br in VV for a fair bit less than that. Unusual?
For what it’s worth, I think those graphs are great. I’m no expert by any means, I think the unit sales and average sale prices would be just fine with 2004 included if the vertical axis was a bit higher on each. It’s entirely possible I’m “over-geeking” that, though.
April 13th, 2009 at 10:35 am
The big difference now from 07 and most of 08 is that buyers must come up with a significant down-payment. So while some homes in the 200-300K range are going to be a ossibility for many it will be interesting to see the number of buyers who can afford the 400K and up market. I think that is were we are seeing the least amount of movement and from what I have seen…the biggest inventory pile-up.
April 13th, 2009 at 10:36 am
I’m renting a 1200 sq ft 3 bedroom in Nutana for 1,000 a month, all inclusive. There are people underneath me, so I don’t have the place to myself, but I don’t pay heat or hydro, which is a huge savings.
Bear in mind: the mortgage is 1350, but the insurance, taxes and utilities (not to mention the upkeep) are substantial and steadily increasing costs.
April 13th, 2009 at 10:37 am
“I think you can. I’d be interested to know how much the house I’m in would go for, but we’re renting a 3-br in VV for a fair bit less than that. Unusual?”
Perhaps I’m out of touch with the rental market. I’ve sure been hearing lots of stories right here from people claiming to be paying over $1000 for a small apartment. I assumed that a decent single-family home would be considerably higher. Time to do some research.
G,
A $400,000 home isn’t an entry level buy for most people. More likely, a first-timer would buy this persons $250-300 and this person would move-up to the $400K, assuming that they have sufficient equity to pull it off.
April 13th, 2009 at 10:37 am
Sask. gov’t offering cash incentive to get more people to move here and fill job vacancies.
http://www.thestarphoenix.com/news/dangles+cash+incentive+encourge+move+Sask/1420938/story.html
April 13th, 2009 at 10:37 am
Mark,
Quite a timely move by the provincial government…
EI numbers are out, and YOY numbers have taken a big jump in Ontario and most of the West.
http://tinyurl.com/clnk9y
“The number of Canadians receiving employment insurance benefits was up 22.8 per cent in January from the record low recorded in February, 2008, and bankruptcies were up 14.9 per cent year over year in January.
Statistics Canada reported Monday that the growth in the number of employment insurance beneficiaries was “especially strong in Alberta, British Columbia and Ontario, all of which recorded month-over-month increases that were above the national average.”
Employment Insurance: Statistics by province
http://tinyurl.com/dda846
April 13th, 2009 at 10:38 am
Hi Norm, I tried to dig out a comment from this blog, but it seems that search engines are blocked. I think there is a purpose for that.
I want to find is the house price history of Saskatoon from 1950 to the present. I remember someone has posted a nice graph somewhere … cannot find.
April 13th, 2009 at 10:38 am
Norm,
I think the rental market has been quite volatile the last while. There are some houses ( whole house) in a good area that are rented for less than 1000 a month and the same kind of house a few blocks away charging 1300 for the top and 700 for the bottom.
Because the rental market was tight at one time and landlords who bought close to the peak needed to charge this to make ends meet, renters had no choice the last while to fork this money over. The low rent others are paying is because of landlords who bought pre-boom and don’t need to charge outrageous prices.
But rents will come down. That 250k house with %5 down will set you back 1160 a month with a 3.3 variable rate. It is one reason why I think buying is not a totally bad idea right now.
April 13th, 2009 at 10:39 am
Don,
This blog software does not have a search function, and while I have no control over what Google chooses to index, there are no pages or posts on this blog that have a “no index” meta robot.
I’ve created a customized Google search for you which will search only the TeamFisher domain. Hopefully that will make it easier for you to find what you’re after. I have no recollection of the graph you’re speaking of. Perhaps someone else will remember.
http://www.google.com/coop/cse?cx=001309532460585412449:cqoputgb1go
April 13th, 2009 at 10:40 am
Norm:
“Perhaps I’m out of touch with the rental market. I’ve sure been hearing lots of stories right here from people claiming to be paying over $1000 for a small apartment”
No; sadly, you are not out of touch. We’re still paying a grand for our 760-ish sq ft 1-bedroom apartment at the Candlewood on 4th Ave. And that’s while they’re working on installing the condo-required sprinkler systems (drilling and hammering on a concrete building. Makes for some fun noise early in the morning).
April 13th, 2009 at 10:40 am
Mark,
“Sask. gov’t offering cash incentive to get more people to move here and fill job vacancies.”
http://www.thestarphoenix.com/news/dangles+cash+incentive+encourge+move+Sask/1420938/story.html
Good grief–the last thing Saskatoon (and Saskatchewan in general) needs is more people to make house prices even higher. Stop the madness already! This city can’t even sustain the people who already live here.
April 13th, 2009 at 10:41 am
Don,
as well one of Norm’s most loyal followers of this blog, I am pretty sure there is not a graph for Saskatoon house prices dating back to 1950. It may have been a graph for a different city.
April 13th, 2009 at 10:42 am
Norm, you said “You can now finance a $250,000 house for $1315 a month”… True, but I’d really like to point out that, even in the first month of the mortgage, only $833 of that payment is the cost to ‘rent’ the money… and your ‘rent’ goes down every month thereafter. Lumping principal and interest together tends to make people forget that (in a steady market), they get the KEEP the principal portion of their payments as equity in the home. Add about $150 a month for taxes, and $250 a month for utilities and insurance, the real cost to own is about $1250, all in. jrochest makes a good point about upkeep; it’s worth budgeting a little extra each month for that; add another $50-100/month? We actually wind up back at about the number you put out there. But that includes EVERYTHING. I can see why people would be thinking about buying again.
It sounds like Crikey scored a deal! However, from the places I’ve seen friends buying and renting lately, I agree that you can buy something for $250000 that is a lot nicer than what you can rent for $1315. Plus, there are quality of life issues to consider: i.e., of the six people I know who rent, all but one were evicted last year when the landlords put the places up for sale (one fellow was evicted twice in one year, and another got his eviction notice the day after he moved in).
April 13th, 2009 at 10:42 am
Heather,
Thanks. Of course, you’re correct but you can’t get away with suggesting that there might be “equity” with this crew.
I’m kidding everyone.
Thanks again.
April 13th, 2009 at 10:42 am
George,
Thanks. I did manage to find some “other city” graphs but nothing that went back anywhere near 1950.
Don,
Not sure if this helps but I have a ten year history for Saskatoon posted here.
http://www.teamfisher.com/Saskatoon_at_a_Glance/page_1723426.html
The same statistics by Saskatoon neighbourhood can be found here.
http://www.teamfisher.com/Neighbourhoods/page_1719893.html
April 13th, 2009 at 10:43 am
Norm,
You can now finance a $250,000 house for $1315 a month, and you can do that over 25 years. I don’t think you can rent that house for that amount. That same house would have been near $2,000 a month at the peak (when it was selling for $300K).”
jrochest,
“Bear in mind: the mortgage is 1350, but the insurance, taxes and utilities (not to mention the upkeep) are substantial and steadily increasing costs.”
Heather,
“I’d really like to point out that, even in the first month of the mortgage, only $833 of that payment is the cost to ‘rent’ the money… and your ‘rent’ goes down every month thereafter.”
These are all true statements, but what is my incentive to give up my $875/mo apartment and jump into a $1350 payment (of which how much is unrecoverable interest?) plus try to carry all other costs and future maintenance savings responsibly?
And I’m wondering why we compare things to the peak. They shouldn’t have got that high in the first place and are still overpriced for what you get.
As a first time buyer, it just doesn’t add up for me. Not yet anyway. And my concern is that these prices are here to stay – which means it will take me/us longer to save up for the 20-25% downpayment which I believe is the smart way to buy a home.
captcha – far-leftist Flinn (what??)
April 13th, 2009 at 10:43 am
jrochest said:
“Bear in mind: the mortgage is 1350, but the insurance, taxes and utilities (not to mention the upkeep) are substantial and steadily increasing costs.”
I don’t think it’s accurate to characterize these costs as ’steadily increasing’. For example, since buying our home our insurance has dropped ~15%, our taxes have already dropped small amount and will likely go down by several hundred dollars this year, and heating is also scheduled to drop with the proposed rate decrease.
They may ’steadily increase’ over time with inflation, but that brings up the fact that ALL the costs increase with inflation for renters, while the biggest chunk- the mortgage payment- stays delightfully uninflated for the life of the purchaser’s mortgage loan.
April 13th, 2009 at 10:43 am
cyn_d,
“As a first time buyer, it just doesn’t add up for me.”
I’m not suggesting it should. I’m simply saying that decreasing costs of home ownership may have a positive impact on demand. I’m thinking that it could keep demand at or towards the “normal” range, and then again, maybe not.
April 13th, 2009 at 10:44 am
“ALL the costs increase with inflation for renters, while the biggest chunk- the mortgage payment- stays delightfully uninflated for the life of the purchaser’s mortgage loan.”
Not in Canada, it doesn’t. 30-year mortgages are the norm in the US, but they are an aberration here and if you decide to go for it then you pay a significant interest rate premium in order to get it.
Most people have 5-year terms (or less) on their mortgage, meaning that we all get to play Mortgage Rate Roulette several times over the amortization period of our biggest purchase. Will it go up? Will it go down? How long do I lock in for? Hurry hurry hurry, folks… Ya pays yer money, ya takes yer chances!
April 13th, 2009 at 10:44 am
It’s true that the interest rate can and does change, but the principal amount ignores inflation for the life of the loan (and in fact steadily decreases.)
So in 5 years, say the cost of renting my home would be $2500/month. My mortgage payment, even with interest rates 2-3 times higher those we’re seeing today, would be less than half of that.*
Anyway, this is a wholly different debate than the point I was trying to make- the costs associated with home ownership do not necessarily “steadily increase” in real dollars.
*All the numbers in this paragraph were pulled completely out of my $^# to illustrate the general point.
April 13th, 2009 at 10:44 am
Thanks, Norm and George. It must be somewhere wrong with my memory.
I found google is still indexing the comments here and I will try to dig out where my memory shard come from.
April 13th, 2009 at 10:44 am
Interest rates look like they will be down for quite a long time. No reason to rush an ill advised purchase. Buy the same house for less at the same rate in one year’s time.
April 13th, 2009 at 10:45 am
Ahh,
The most precious commodity for me this past year has been time. I think I may have aged 5 of them. I’m back though (for the few who care)
My first comment will be in regards to the Saskatoon market. As I stated in August of 2007, the top would be reached in May 2008 to be followed by a 15% drop in prices through the winter of 2008/2009. Maybe it has been more than 15% (Not sure of the numbers since May). Now that we are here, I fully expect some traction to the upside for our market in the short term. This should happen through out the world as balance is temporarily restored from the flight of money from investments.
I also said (I believe last Spring) that the U.S. would economically collapse and that mass selling of the stock market would take place take place in April of this year. Obviously my time frame was way off base as this happened in October (and is not just confined to the U.S.). However my overall outcome was bang on. These rising markets will be a temporary illusion as a 2nd phase of a sharp downward spiral should take place. I see U.S. data to show signs of strength in to early 2010, as well the Dow to rally to 9800 by December. This will quickly turn south again with the Dow eventually bottoming around 4000. This doesn’t take in to consideration of hyper-inflation which could potentially take place if the confidence of the masses swings back to the private sector. If people continue to look at the government (public sector) for their answers then interest rates will stay low. If people loose faith in the government in fear of it going bankrupt then interest rates will skyrocket and hyper-inflation will take place. To know the direction, look at the yield curve between short term and long term interest rates. Either way there’s still a lot more downside to come long term.
This worldwide problem is a banking issue that has been carefully planned. Unfortunately instead of letting the free market correct itself, the governments (from direction of the elite) will get their incompetant hands all over this by creating laws, passing bills and throwing our money away in an attemp to “fix” the problems. These laws and bills will seem great to the masses but will actually rob the people of their freedom by giving control to government and government appointed agencies, thus enslaving the masses to long term debt. The sad part is the more dispare they create, the more people will give up their freedom. The world better get ready for a socialist/communist system as this is right in the communist manifesto on how to turn the world to communism. Turn the Proletariat against the Bourgeousie. Get them so mad at each other that they don’t see what’s behind the curtain. What’s all over the news…Wall st vs Main st.
It’s time to wake up
April 13th, 2009 at 10:45 am
Hey Northstar,
Good to see you.
April 13th, 2009 at 10:45 am
U.S. “Home sales: Less awful”
http://tinyurl.com/c4tesv
April 13th, 2009 at 10:45 am
LOL- yes, ever so slightly less awful! Here’s a nice graph showing the context in New Home Sales data:
http://tinyurl.com/d8u5n7
Interestingly, months of supply of new homes in February looks to be ever slightly below the all time record of 12.9 months of supply set in January.
By the way, what’s the consensus on the recent stock market action? New bull or just bull?
April 13th, 2009 at 10:46 am
Northstar,
welcome back.
Crikey,
almost a guarantee that it is a bull market. Whoops, better make that a bull in a china shop market. And the bull is hungry, horny and mad. Hopefully he does not wreck the market that much
April 13th, 2009 at 10:46 am
George,
You’re hilarious! Speaking of bulls in china shops; have you seen this video of Geithner talking about this latest trillion-dollar QE plan?:
http://tinyurl.com/cn65eq
Rep Gresham Barrett: “The last question I have guys, which is the $64 million question or I guess I should say $64 trillion question is: What’s the backup plan? If everything fails what do we do? Where do we go from here?”
Treasury Secretary Geithner: “Congressman this plan *will* work…It just requires will; **It’s not about ability**. We just need to keep at it. We just need to work with Congress to make sure we do this on a scale that will make it work.”
Ai-ai-ai. Quite the artful dodger. The answer was alarming enough, but he didn’t even attempt to answer the question!
April 13th, 2009 at 10:46 am
Norm, is there a neighbourhood with more schizophrenic pricing than Caswell Hill? Just looking at point2, there are $50-75,000 gaps between places of similar size and condition.
April 13th, 2009 at 10:47 am
Crikey,
I have tried to lighten up my comments since one poster on this blog called me a “worst case scenario dude”. It was in good faith. His posts always have a grey background. If I ever find the guy….
64 trillion? I remember a time not long ago it was ONLY 53 trillion!
http://www.iousathemovie.com/.
They don’t want to mention the back up plan to the public.
April 13th, 2009 at 10:47 am
I do remember that! Here’s a haiku to commemorate that incident:
George feels long-term pain
“worst-case scenario guy”.
Horny bulls abound.
Yes, it may be a slow work day.
April 13th, 2009 at 10:47 am
George,
I do hope you know that it was intended to be in fun. You are someone whom I appreciate very much.
April 13th, 2009 at 10:48 am
I actually meant that haiku to be funny, in case it wasn’t obvious. I ,of course, can’t proclaim to know what George really felt about that, but I didn’t get the impression it was a big deal.
April 13th, 2009 at 10:48 am
Norm,
it was nothing, I am just bugging you about it.
other news
Home price drop sharpest in Calgary: report
http://www.financialpost.com/news-sectors/story.html?id=1427054
Rumour has it that the infamous bumper sticker from the 80’s has resurfaced in Alberta.
April 13th, 2009 at 10:48 am
Regarding the ’surprising strength’ in houses and durable goods in February… anyone who appreciates facts over spin REALLY needs to read the following articles from Chris Martenson’s site.
http://www.chrismartenson.com/blog/more-fuzzy-reporting-new-home-sales-misrepresented/15617
http://www.chrismartenson.com/blog/more-fuzzy-numbers-durables/15630
April 13th, 2009 at 10:49 am
I thought I’d share this Charlie Rose interview- a bit lengthy, but very well done. Lots to digest.
Andrew Ross Sorkin, Paul Krugman and Joe Nocera
An update on the economy
http://tinyurl.com/d8wxan
April 13th, 2009 at 10:49 am
Sorry for the late response!
Crikey,
Thanks for the last article. I may as well see what my mortgage broker has to say about variable before deciding which to choose.
Armoth,
I’m not one who likes to play “craps”. ;’) However, over the next couple years it doesn’t look like the interest rates will/can increase much. My gut still says to lock it in though.
April 13th, 2009 at 10:49 am
“My gut still says to lock it in though.”
Royal just gave me 4.25 on a five year fixed, which I thought was pretty great. I think when you lock in, you get a 90 day guarantee as well, so if rates drop even further in the next three months, your fixed rate does too.
April 13th, 2009 at 10:50 am
Heather,
Maybe this may work for you?
In a variable rate, you can lock in to a fixed rate at any time you choose. Some lenders will hold that fixed rate for 3 months. If you’re worried about rates going up then simply go to your lender and say your thinking about locking in your rate and could they please provide you with written confirmation of the fixed rate you’d be paying. That rate should be good for 90 days. If rates start to go up then lock in. If not, then go back to your lender in 90 days and get a new written confirmation that will be good for another 90 days. Keep doing this process until rates start to go up. Then lock in.
If the central bank were to jack up rates that would be suicide to the economy. I don’t see rates going anywhere for the next year at least
April 13th, 2009 at 10:50 am
Rates are not going up anytime soon. Closed variable is 3.3 and open variable is 3.5.
Mark,
I would definitely shop around. or at least tell Royal you can get 3.99 for five years fixed. Anybody getting a rate should let the banks bid on you.
http://www.mortgagegrp.com/site/SK/rates.asp
April 13th, 2009 at 10:50 am
I got offered 3.99 for five years fixed last week, but like George says, you might be able to do better. There’s nothing to lose by shopping around.
April 13th, 2009 at 10:51 am
“I got offered 3.99 for five years fixed last week”
That was at RBC, btw.
April 13th, 2009 at 10:51 am
lb,
“Norm, is there a neighbourhood with more schizophrenic pricing than Caswell Hill?”
Sorry I missed you yesterday lb. Caswell is one of those areas where you can have fairly wide gap between a premium character home with a good basement and something of similar size that’s ugly and perhaps has some basement issues. 70K is a pretty large spread for an 800 square foot bungalow.
April 13th, 2009 at 10:51 am
What we’re hearing from above is there is little risk of interest rates going up within the next year. We all have time to sit the housing crash out.
April 13th, 2009 at 10:51 am
Sask population up 15,000 in 2008
http://www.thestarphoenix.com/Business/Saskatchewan+sees+population+grow+more+than+2008/1431546/story.html
April 13th, 2009 at 10:52 am
If you read the story, the “boom” still leaves us with less people in the province than in 1988. Funny, we couldn’t keep up with a net gain of 0 over 20 years.
And not sure where these people moved, but Saskatoon’s inventory of available housing for sale is double what it was last year.
Still have to wonder what will happen to population next year, as new grads now have a cheaper option in Alberta, that also happens to pay more and tax less.
April 13th, 2009 at 10:57 am
Nick, I can count on you to find the cloud in the silver lining. By the way, new grads have a cheaper option in Alberta? As I recall, average house prices are still quite a bit higher in Edmonton, and way, way higher in Calgary, than Saskatoon. And I can assure you, a 280,000 house in Calgary means a hell of a commute. Saskatoon has double the inventory sure, but weren’t a hell of a lot of houses built there in the last few years. Thankfully people have been coming or it would be worse. More are on their way. Quite a bit of jobs coming to that city this year, and over the next few years. I think more people are on their way – we know many new immigrants are arriving – but also from less economically fit parts of the country.
Crikey: Seriously, RBC gave you a 3.99 offer? I now have a bunch of mortgages with Royal, have great credit, and know the woman I’m dealing with well. I mentioned today hearing of the 3.99, and she suspected it was a virtual or online lender, without offices. But she wanted to know the name of the lender. I shall go back to her again now. Just curious – was that offer given from RBC directly, or did an independent mortgage broker get it for you.
April 13th, 2009 at 10:57 am
Further to that Crikey, she just replied to me noting that you must have been quoted a five year variable closed, not a five year fixed. But perhaps she’s wrong here.
April 13th, 2009 at 10:58 am
Mark,
I can tell you with certainty that RBC was advertising 3.99% on their website within the past few weeks. I saw it listed under “special offers” on their fixed rate page at http://www.rbc.com.
That rate is available today through Merix and MCAP, both of which would require assistance from a broker.
April 13th, 2009 at 10:58 am
Thanks Norm. That special offer now reads 4.25, as of tonight anyway. Some rates may have bumped back up a bit in the past week or two.
April 13th, 2009 at 10:58 am
Mark,
“Just curious – was that offer given from RBC directly, or did an independent mortgage broker get it for you”
Sorry for the late response, Mark. Yes indeed, that was through RBC directly for a 5-year fixed, in my friendly neighborhood office. It’s entirely possible it’s no longer available.
April 13th, 2009 at 10:58 am
Northstar,
Thanks. That definitely is a possibility to consider. It’s a bit of a hassle, but if I truly want the best rate with no risk that’s the way to do it. (providing the contract allows for it – would this be an open variable?)
Mark,
I am an RBC client (multiple accounts, credit cards, LOC, RRSPs) and have never been offered a competitive rate – I’m not sure what gives! None of 3 major banks have been able to match the rates given by mortgage broker at TMG. Check out today’s rates (3.99% 5 year) and make an appointment if interested:
http://www.mortgagegrp.com/site/SK/rates.asp
April 13th, 2009 at 10:59 am
I have just come across everyones comments above and I wanted to share more information with you about the http://www.saynotobanks.com site.
Banks and Government Collaborate in $11 Billion Rip-Off of Canadians
Background: As of March 2009, all Canadian Banks acted in unison to impose a 1% increase in the interest rate that Canadians pay on their existing, outstanding debts. For those who had historically been borrowing at prime, the new rate became prime plus 1 percent. If your loan rate was at prime plus 2, you are now paying prime plus 3 percent. This increase was announced at the same time as the government was aggressively cutting the bank rate in a desperate attempt to stimulate the economy and job creation. To rub salt into this wound, this interest rate increase on consumer loans was announced after the banks had already chosen not to pass on all of the rate reduction provided by the Bank of Canada.
Here is how the math works:
· Average Debt per Canadian Household: $90,700
· Number of Households in Canada: 12,437,500
· Minimum Interest Rate Increase Imposed by each Canadian Bank: 1%
Therefore:
($90,700.00 debt/household x 12,437,500 households x 1% )
$11.28 billion in increased annual revenue.
Benefit to Canadian Banks: Increased Annual Revenue – Forever
Please go to http://www.saynotobanks.com for details.
April 13th, 2009 at 10:59 am
“Check out today’s rates (3.99% 5 year) and make an appointment if interested”
Heather D, do you work for TMG? lol
April 13th, 2009 at 10:59 am
Lenders seek Ottawa’s aid as thousands risk losing their homes
As many as 25,000 Canadian homeowners who consistently met their mortgage payments could lose their homes unless Ottawa or other financial players help supply capital to the struggling subprime lending market.
http://tinyurl.com/dksczj
April 13th, 2009 at 11:00 am
Norm,
5 billion? I thought it would be higher than that.
That is what GM burns through in a month! I don’t think subprime is too much of a problem compared to the States.
In the States it was something like 1.5 trillion.
If anybody watched the PBS documentary on the weekend about subprime lending, it was truly criminal. Person A with good job and excellent credit gets a new loan the loan officer gets a $500 bonus. Person B with no job bad credit ( NINJA) gets a loan the loan officer gets a $1000 bonus. It was a system that encouraged bad loans and if anybody spoke up ( one lady on the show did) they were gone.
April 13th, 2009 at 11:00 am
Did everyone forget about the Frontier Center study that had Edmonton as more affordable than Saskatoon?
4.2 years of income in Edmonton
4.6 years of income in Saskatoon
Norm even threw up a link to it.
And that doesn’t even count that rent is cheaper in Edmonton. Way cheaper. No commute. Rent right by work for cheaper than Saskatoon. Rent here is crazy. At least it stopped going up. No reason to wait around here for a couple years for some of those spec condos to be rented at a discount. Moving to Edmonton to save on rent. Still here because no dream job yet. A couple found already that pay more, but why settle for better when I can find best?
PS – I am currently looking at jobs and accomodations in Edmonton, thanks to the heads up from this site!
Would have tried Winnipeg for a huge cost of living savings, but just don’t like it. Too old and dirty, too much like Saskatoon.
April 13th, 2009 at 11:01 am
also agree with Nick on the population thing
matching the population from 20 years ago is NBD
to pretend there’s a housing shortage when so much is available and there was 20 years to catch up to breaking even? sounds fishy
April 13th, 2009 at 11:03 am
“And that doesn’t even count that rent is cheaper in Edmonton. Way cheaper.”
Not according to anything I’ve read. I remember the average 2 bedroom in Edmonton over 2008 was at least a few hundred dollars more than the average rent for a 2 bedroom in Saskatoon. It was over 1000 in Edmonton, 1030 or something. Feel free to point me to any evidence you have that average rents are higher in Saskatoon, beyond anecdotal. I’m sure some people are paying 1000 for one bedrooms, but I’m talking city wide averages.
Also, house prices in Saskatoon have come down by a higher percentage than they have in Edmonton over the past year. I’d be surprised if buying wasn’t more affordable in Saskatoon now.
April 13th, 2009 at 11:03 am
“matching the population from 20 years ago is NBD”
Going from losing people yearly to gaining people yearly is a very big deal actually. A complete reversal in fact. Question is, what happens next?
April 13th, 2009 at 11:04 am
Average rents as of December 2008, both articles quoting CMHC data.
Average 2 bedroom in Saskatoon – 841.
Average 2 bedroom – 1034 Edmonton
http://www.financialpost.com/story.html?id=1062541
http://www.edmontonrealestateblog.com/my_weblog/2008/12/weekly-update-2.html
April 13th, 2009 at 11:04 am
We’ve never been able to make sense of the “medians” used in the Demographia study, and while I agree with the general premise of the report things have changed quite a bit since it was released with data based on Q3/08. Prices have come down by at least half of one year’s median income. I would be surprised if we have not slid out of the 4’s and into the high 3’s. Not really that certain how Edmonton compares but I don’t believe Albertan’s got an income tax cut or a property tax cut this year either.
Perhaps I’m not seeing things clearly, but I get the impression that Saskatchewan is once again looking more attractive as time goes by.
April 13th, 2009 at 11:05 am
Banks are saying they have never had so many “pre-approved” buyers in Saskatchewan, ever.
April 13th, 2009 at 11:05 am
I agree Norm, median rents…that doesn’t mean anything to much of anyone.
April 13th, 2009 at 11:06 am
L.oki,
“Banks are saying they have never had so many “pre-approved” buyers in Saskatchewan, ever.”
Really? That’s information I’d like to see. Do you have a link for that?
Thanks in advance!
April 13th, 2009 at 11:06 am
Oh Mark….do NOT use CMHC’s data…it’s been so out of touch with how things are as far as rental prices…I always wondered what they used to get their ‘average’ prices…
Check the actual link out for CMHC’s Saskatoon page…just SLIGHTLY outdated…and this is to try to get people to settle in Saskatoon…
Should be criminal to have such old info on their site….
http://www.cmhc-schl.gc.ca/en/co/buho/seca/sa/sa_002.cfm
April 13th, 2009 at 11:06 am
“Oh Mark….do NOT use CMHC’s data…”
I’m fine to look at any other data. Just saying when someone says rent is way cheaper in Edmonton than Saskatoon, there must be some way of comparing. Does anyone have any better info on how the two cities compare rent wise?
April 13th, 2009 at 11:07 am
“In Saskatoon, the average MLS ®1house price is $160,577. Compare with other cities.”
LMAO!
Mark that’s hilarious!
saskatoon also brings up some super old study to prove it’s affordable. rent for a similar appartment near the U of S is more than near the U of A. maybe the average is more in edmonton, probably because the average place is nicer.
norm, don’t think that study looked at after tax income. wasn’t it just a simple off the top median comparison? alberta already had and still has way lower income tax. and housing in edmonton is getting cheaper too.
April 13th, 2009 at 11:08 am
breaking even population wise over 20 years still puts us below pretty much everywhere else
tough to pretend there’s a housing shortage
we’ve been building houses and condos for 20 years with a net gain of 0
April 13th, 2009 at 11:09 am
renter,
“norm, don’t think that study looked at after tax income.”
That’s correct. The tax reduction comment was an aside. In other words, “not only have house prices dropped by at least a half year’s median income but we’ve also gotten a reduction in personal income taxes and property taxes.” I’m simply talking about improvements.
“In Saskatoon, the average MLS ®1house price is $160,577. Compare with other cities.”
That is bad. If you click through to the “comparisons” it states that the data is from October, 2006. If i can have my site updated monthly surely CMHC could at least get into 2008.
“tough to pretend there’s a housing shortage”
You’ve said that twice now. Who is pretending that there’s a housing shortage? Been a long time since I heard anyone make that claim.