Saskatoon house prices stabilize but down 5% year-over-year: Royal LePage
Saskatoon, SK, October 8, 2009 – The Royal LePage House Price Survey released today showed the average year-over-year price of homes in Saskatoon is down five per cent over last year. However, a more balanced market has put an end to 13 months of consecutive price declines.
“Since bottoming out in April 2009, prices have stabilized,” says Norm Fisher, Sales Manager for Royal LePage Saskatoon Real Estate Ltd. “Average buyer discounts in Q3 ranged from 3.5 to 4.5 per cent, showing buyers and sellers are making reasonable negotiations.”
Inventory is at 58 per cent of last year’s levels so homes are moving quickly. “Unit sales are through the roof,” Fisher says. “We’re hitting near record unit sales for most housing types. Overall unit sales in Q3 were up nearly 50 per cent over the same period last year.” Lower priced condos are moving faster than in Q2, but unit sales for condos in the $300,000 to $350,000 range are down year-over-year.
Although some single family homes priced below $350,000 are generating multiple offers, buyers are typically cautious. “The current Saskatoon market isn’t like the boom period of 2007,” he says. “We had a rally in the first quarter of 2008, then the market flattened out.”
Selling for an average of $291,000 in Q3, west side detached bungalows are the only housing type that showed a year-over-year price increase. Overall, lower priced homes have depreciated less than more expensive homes.
Overall Canada’s housing market appears to be on the road to recovery, but despite the strength of the market in the third quarter, giving the appearance of a surge in real estate activity, Royal LePage cautioned that sales are actually lagging approximately one month behind the typical seasonal pattern in year-to-date analysis.
“The economic recession interrupted the flow of the real estate cycle but it is essentially back on track,” said Phil Soper, president and chief executive officer, Royal LePage Real Estate Services. “There is the illusion of a boom in the market, but in fact what we are experiencing is the end of a normal, short-term correction. Once housing supply returns to normal levels, we believe the economy will support low pricing growth into 2010.”
Click the image for a larger view.
Royal LePage House Price Survey chart for Canada
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Norm Fisher
Royal LePage Saskatoon Real Estate
20 comments so far. We'd love to hear your thoughts.
October 8th, 2009 at 9:04 AM
Condominiums are only down 0.6% year-over-year in Saskatoon; that’s a little surprising.
October 8th, 2009 at 10:23 AM
Jason,
I don’t disagree. This is probably one of those examples where “averages” don’t tell the whole story. Same thing with west detached bungalows being up. Even though the actual numbers say it’s so, we probably have some issues arising from averaging. All that said, the three month average in the condo category is off less than 4% year-over-year, with some of the greatest pressure on the upper end stuff. Condos lost a lot very quickly at the start of the correction and have seen a pretty good upward push over the past quarter.
October 8th, 2009 at 10:35 AM
I’d say averages aren’t much to trust ever, especially in markets with multiple personalities like Winnipeg.
Are there any areas in particular that caused Saskatoon to dip?
October 8th, 2009 at 10:44 AM
Alex,
That’s a good question. My sense is that most areas of the city have performed more or less similarly. I don’t think there are significant differences but one of these days soon I will have to chart the numbers by area. I have them all handy, just need to get them on a spreadsheet.
October 8th, 2009 at 11:50 AM
Any ideas why the West averages are up? And are there particular neighborhoods on the West side that are up more than others?
October 8th, 2009 at 12:29 PM
Jon,
Our “west” numbers are based on area 5 (everything west of Circle Drive West). As mentioned earlier, I think this is a case of a fairly small sample that could be subject to ups and downs when averaging. A few higher quality listings that sell at a premium could skew these numbers higher, and of course, the opposite is also true. Having said that, there’s no doubt that the most affordable single-family homes have seen the least amount of price pressure.
October 9th, 2009 at 10:12 AM
Heard you on CBC this morning, Norm, along with another (very bullish-sounding) realtor — from Regina, I think. The wrap-up on the piece was, “[These two men] state that they see a return to 5-10% housing increases in the near future.” It was spoken in such a way that I couldn’t tell if that was net, annual, bounceback, or what.
Did you hear the piece? If you know exactly what they were trying to say about the increases, could you clarify it for me? And if you heard it, what is your feeling on how your own thoughts and opinions were represented by it — were they an accurate reflection, or were you incorrectly conflated with the other realtor?
October 9th, 2009 at 10:18 AM
Bookrat,
Please tell me that you’re pulling my leg.
I said no such thing about potential increases. In fact, I told the reporter I spoke with that I thought we were pushing the absolute limits of affordability at the current low rates and that prices could be negatively impacted when rates rise unless we see some solid income growth.
I did not listen to it.
October 9th, 2009 at 10:28 AM
Bookrat,
I’m trying to reach the guy I spoke with yesterday but he’s not answering the phone.
You have [These two men] in brackets. How shall I interpret that. Did they actually say “These two men feel”?
“what is your feeling on how your own thoughts and opinions were represented by it — were they an accurate reflection”
I feel that if you heard me saying it you can assume it accurately reflects my feelings (at least a 75%, but even recording quotes can be inappropriately used). If it’s some reporter giving his or her feelings, on my feelings, it’s probably slanted by some bias that they are bringing to the report.
What you’re telling me is absolutely astounding to me. I was very positive about the current state of the market (strong unit sales, lower listing inventory, straight line in prices) but quite reluctant to make any predictions, and expressing caution about affordability. In fact, the suggestion of a 10% increase in the near term is completely ridiculous and only a fool who is begging to be wrong would say something like that. It’s October in Saskatchewan.
October 9th, 2009 at 11:47 AM
Norm:
I was half-listening to the news driving to work when I heard your name mentioned, which caused me to perk up. For that reason, I missed some of the initial part of the report, but on mental playback realized that the Regina guy had been quite positive in his outlook. I did think that the parts where you actually spoke were more balanced and less pie-in-the-sky than his.
The tone of the piece was along the lines of, “Yes, we’re lower than last year, but that’s because things were so weak early in the year. Inventory is down to 2/3 of its high, and the outlook is much stronger.” It wasn’t so much *your* words that said this, as those of the reporter and the other person, but you were lumped in with them. Yes, the end of the piece said, “[XXX] and Fisher see a 5-10% rise…”
Sorry to be the bearer of bad news. :-/
October 9th, 2009 at 12:08 PM
Oh, God!
From now on I’m going to record my end of the conversation.
Thanks for the heads up. CBC has three phone numbers listed in Regina. One of them doesn’t ring at all, the other two just ring and ring, but I sure would love to speak with “Jordan” from CBC Radio today.
October 9th, 2009 at 12:08 PM
I wonder if CBC has the clip hidden away on their website somewhere. Sometimes its difficult to find things there, but I’d like to catch it if possible.
To raise an old argument: Income growth or price decreases?
Inflation will inevitably indicate the former will be the only solution allowed – if any…
October 9th, 2009 at 12:18 PM
Alex,
“I wonder if CBC has the clip hidden away on their website somewhere. Sometimes its difficult to find things there, but I’d like to catch it if possible.”
I can’t find a phone number that works but if you come across it please let me know.
“To raise an old argument: Income growth or price decreases?’
That really was the point of my comment which was simply expressed in the positive. If people are maxing out now (which I believe they are) and rates increase you either need some income growth to support it, or prices have to come down.
I’m definitely learning to never say never but I don’t see anything on the horizon that would push prices higher in the short term. As Jen said the other day, we are cranking out a record number of sales and prices have just remained flat. Sure, inventory is down a lot but we’re now headed into our slow season and demand will be dropping, perhaps faster than the supply.
October 9th, 2009 at 2:54 PM
Alex: no clip. It was a local news story, which they don’t keep on their website.
Norm: I called the local CBC radio station. They had a paper copy of the story, and someone read it to me. The quote was about what I had remembered; “He and Fisher expect prices to start going up at a steady rate of five to ten percent.”
He = Dugglesbee = the Regina realtor in the piece.
Contact information for the CBC story editor in Regina sent to your inbox.
October 9th, 2009 at 3:00 PM
Thanks Bookrat. I just spoke with the story editor. He is going to have the reporter give me a call, but as you might expect, the story has run its course. I doubt a correction is forthcoming but I do appreciate having an opportunity to tell them how I feel about it.
October 9th, 2009 at 6:29 PM
Bookrat,
FYI, I received a call this afternoon from a very apologetic reporter who reviewed our discussion and acknowledged that he mistakenly lumped me together with the other agent he interviewed for the story. I appreciate your efforts in getting me in touch with them again. Thanks.
October 10th, 2009 at 5:58 PM
Hey Norm,
Is there a way of finding recently sold in Wakaw. I was looking for a certain house in the town not at the lake or surrounding area, further it was a 3 bedroom.
October 10th, 2009 at 6:00 PM
2 bedroom, sorry
October 11th, 2009 at 9:06 AM
Responded by email Rick.
October 19th, 2009 at 9:14 AM
I love CBC for a lot of their more prominent shows, but sometimes the reporting done on their less popular channels is downright sloppy. Especially when it comes to technology, I get frustrated with their shopping-channel grade familiarity.
I’m sure in living, eating, breathing and sleeping real estate Norm, you’ve lost a few hairs over the media. No doubt this time at the least given it involves you!
Are there any email addresses you know of that I can use to register my displeasure?
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