Comments on: October numbers are in….

By: December numbers are in… - Edmonton Housing Bust

December numbers are in… - Edmonton Housing Bust — Sat, 23 Jan 2010 20:52:49 +0000

[...] condos apparently decoupling in October and November and seeing rather large month over month declines while the rest of the market held, [...]

By: CM

CM — Wed, 04 Nov 2009 20:13:17 +0000

Hi DF,

I use the data at RentFaster.ca

It seems to provide a large enough sample size, although there seems to be a lot more listings for the Calgary area than Edmonton.

By: df

df — Wed, 04 Nov 2009 20:02:50 +0000

CM could you share your source for median rent?

By: Kevin

Kevin — Wed, 04 Nov 2009 05:28:44 +0000

I don't think it'll have much of a long term effect, unless these sales remain for another year or more. There is already such an oversupply out there, whether the resales change hands from one speculator to another really doesn't matter.

It only becomes an issue with new sales, so if their is a sustained period of high sales, builders will start amping up construction and we'll be even more overbuilt. But with the excess supply from the prior two years, and that it takes longer for builders to respond to market forces I don't see a season or two having any real effect.

In many ways speculation helps the market, as it stimulates new construction because it transfers risk from the builders. The problem is when it gets carried away for years on end like it did and you end up with a massive glut.

On the resale market when speculation gets out of hand it can cause a short term pinch in supply (as witnessed in 2006), but ultimately it proves artificial.

By: Jawbone

Jawbone — Wed, 04 Nov 2009 02:00:59 +0000

Kev, do you think the return of speculators to the market will hurt or help in the long run?

By: Kevin

Kevin — Tue, 03 Nov 2009 23:36:41 +0000

Interest move my Mike Fotiou, doing a experiment with letting people list at a flat rate (non-refundable) in lieu of a listing agents commission.

http://calgaryrealestatereview.com/2009/11/03/list-for-less/

By: CM

CM — Tue, 03 Nov 2009 22:31:45 +0000

Price/Rent ratios for Edmonton SFH...

Median rent: $1550
Median SFH : $346,000
= ratio of 223X or 18.6

Calgary SFH
Median rent: $1600
Median SFH: $410,000
= ratio of 256X or 21.4

By: Kevin

Kevin — Tue, 03 Nov 2009 20:09:02 +0000

I've never actually done a straight comparison to unemployment and prices actually, it would be a good idea though… I did do a fairly extensive post on the employment numbers back in July though

http://edmontonhousingbust.blogspot.com/2009/07/get-to-work.html

For now you could compare/contrast these two graphs (unemployment and average prices in Edmonton/Calgary)
http://dynamic-evolution.com/ehb/090710-1.jpg
http://dynamic-evolution.com/ehb/090309-2.jpg

The two noticeable spikes in unemployment also coincided with decreases in price, though the second one was very minor price wise. They were also overall recessions, but we're in one of those too now.

As per the inverse correlation between Edmonton and Calgary, I'd have to disagree, there is always the odd aberration and sometimes one will lead the other by a few months, but on the whole they seem to have a very positive correlation… generally what happens in one, happens in the other in short order.

By: JohnSacs

JohnSacs — Tue, 03 Nov 2009 19:14:09 +0000

“Thanks kevin for all your hardwork.

In your prior analysis has there been a strong relation between unemployment numbers for a region and housing sales? There appears to be an inverse corelation for housing sales for Edmonton and Calgary. Any thoughts?